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Steps to Transfer Money From Credit Card to Bank Account

A credit card gives you the flexibility of purchasing without having to pay from your pocket or the need to exhaust your savings. A credit card works on a deferred payment basis and is considered an ideal alternative to cash. With the availability of virtual online credit cards, it has become easier to initiate payment for a vast range of online services, without the need for  a physical card.

However, there can be certain situations when you might need cash. Further, certain transactions cannot be conducted using a credit card. To back such a situation, you can transfer money from a online credit card to your bank account. With a credit card, you can transfer money to your savings account. 

Ways to Transfer Money From a Credit Card

You can choose multiple methods to transfer money from the credit card to the savings account. You can opt for money transfer apps, e-wallets, net banking facilities, etc. 

  • Using Net Banking to Transfer Funds From Credit Card to Bank Account

Follow the mentioned net banking steps to transfer money from the credit card to the bank account:

Step 1: Go to the net banking website of the bank and login using the necessary credentials. 

Step 2: Go to the credit card section and mention all credit card details.

Step 3: As per your preference, select the transfer option. 

Step 4: Enter the desired amount that you want to transfer from the credit card.

Step 5: Then, per the instruction, provide further details to complete the transaction. 

  • Choose an E-wallet to Transfer Credit Card Money to the Bank Account

E-wallets can easily transfer funds from a credit card to your bank account. Follow the steps to complete the transaction. 

Step 1: Sign up with the e-wallet of your preference. 

Step 2: On the e-wallet app, head to the relevant option.

Step 3: Choose the ‘Transfer’ option. Enter the amount, IFSC details, and account number. 

Step 4: Click on ‘Send’ to complete the transaction. 

Many financial institutions allow you to transfer funds by making a simple call. Call on the customer service number of the credit card company and mention the relevant information. Tell them that you intend to transfer funds from your credit card to your bank account. Mention the amount you want to take and provide them with your bank account number and other information. Follow the instruction to get done with the transaction. 

How to Transfer Money From a Credit Card to a Bank Account Offline?

Besides accessing the online method, you can also choose to transfer funds from the credit card to the bank account via offline methods. 

  • You can use RTGS and NEFT to transfer money from a credit card. You can do it by visiting the bank and requesting a transaction form. Ensure to fill out the form properly with the necessary details and submit the same to the concerned bank authority. 
  • In addition, you can transfer money via ATM cash advances or cheques. Under the facility called ‘Cheque to Self’, you will be able to draft a cheque to yourself. Follow the steps to do so:

Step 1: Mention ‘self’ in the receiver’s name section. 

Step 2: Provide all the details that you usually have to mention all filling out a cheque. 

Step 3: Then deposit the cheque at the bank branch which is near to you. The desired amount from the credit card will be transferred to the mandated savings account in some days. 

  • Even under the ATM cash advance facility, you can withdraw cash from the ATM through a credit card and deposit the amount in your savings account. 

Things to Know Before Transferring Money From a Credit Card to a Bank Account

Here are some of the pointers that you must know before transferring money from your credit card to your bank account: 

  • Higher Interest Rates

You might have to bear a higher interest rate while transferring credit card money into your savings account. The interest rate levied on the cash advance is much higher than that is charged on other available credit options

  • Transaction Fees

Besides paying the interest rate, you will also have to pay a transaction fee to transfer funds from the credit card. This will increase your repayment burden significantly. The amount you must pay under the transaction fee varies from bank to bank. 

  • Debt Burden 

Your debt liability remains the same; you must clear the amount you have transferred from the credit card. The additional expense is that you have to pay the amount with extra interest.

If you are already under multiple debt burdens, transferring money from the credit card will make the scenario more challenging for you, and you can end up in a debt trap. In case you fail to manage the credit card bill payment, you will have to pay hefty fines. Even this will add to your monetary burden. 

  • Tax Implication

Banks tend to report to the Income Tax department if they see a customer transferring a substantial amount from their credit card. The Income Tax Department might start questioning the transfer on seeing your frequent credit card money transfer to your bank account. 

Wrap Up

In conclusion, in a financial crunch or urgencies, resorting to transferring money from a credit card to a bank account proves highly advantageous. However, you must avoid making it a practice. It can affect your finances and increase your debt burden. Moreover, transferring money to a bank account is not the actual usage of a credit card. You can rely on this method of accumulating funds only during emergencies. Try to use the credit card for initiating direct payments.

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