YES Bank credit card rule change; check details here


YES Bank has revised certain features available on all its credit cards except its premium card variant-private. Further experts say that YES Bank is the first bank in India to impose a 1% extra charge on all utility bill payments via credit cards. A utility bill payment can comprise of paying bills for gas, water, electricity, etc.

Paying Gas, electricity, and other utility bills using YES Bank credit card to get costlier from May 1, 2024
Paying Gas, electricity, and other utility bills using YES Bank credit card to get costlier from May 1, 2024

YES Bank has revised certain features of all its credit cards except the ‘private’ credit card variant. For some variants of the bank’s credit cards, the changes are limited to the fuel surcharge category. For all other variants except ‘private’, these changes are related to the calculation of the spend threshold for waiver of the annual fee and joining fee. There is also a change in terms of an additional charge for utility transactions. All of these revised changes are applicable from May 1, 2024.

“These changes shall adversely affect all YES Bank credit card holders except those with the super-premium Private credit card variant,” says Ankur Mittal, CTO and co-founder, of Card Insider, a credit card comparison website.

Also read: Axis Bank stops redemption of credit card reward points earned by these customers.

Here’s what has changed for YES Bank credit card holders from May 1, 2024

A new 1% extra charge on utility transactions

According to the YES Bank website as of March 29, 2024, “A charge of 1% will be applicable on all utility transactions in a statement cycle.”

According to Mittal, “Yes Bank is the first credit card issuer in India which shall implement a 1% charge on utility transactions from 1 May 2024.”

According to Sumanta Mandal, founder of TechnoFino, “This is a major devaluation. When you pay extra or get fewer rewards than earlier, we call it devaluation. Suppose your electricity bill is Rs. 5000. If you pay now using a YES Bank credit card, it will cost you only Rs 5000, but after 1st May 2024 it will cost you an extra 1% + GST for the same utility bill payment.” So, you will end up paying Rs 50 as an additional fee for making this payment through the affected YES Bank credit cards.

YES Bank credit card rule change: Fuel surcharge capping

According to the YES Bank website, fuel surcharge capping limits have been revised for the following variants of YES Bank credit cards:

Serial Number YES Bank credit card variant Fuel surcharge capping till 30th April 2024 Fuel surcharge capping from 1st May 2024 onwards
YES Prosperity Business Rs 500 Rs 250
Select Rs 250 Rs 125
Ace Rs 125 Rs 100
YES Prosperity Rewards Rs 125 Rs 100

Source: YES Bank website

The fuel surcharge is an additional fee imposed by the bank that issued the credit/debit card on transactions made at fuel stations if the payment is being made by credit card and on some debit cards also. For example: if you are buying fuel worth Rs 39,000 in a month and the fuel surcharge is 1% then the surcharge amount comes to Rs 390. If your card has a feature of fuel surcharge waiver this would have waived off for the top two variants shown in the table. However, now with the reduction in the capping to Rs 250, you would end up paying Rs 140 more even on the top variant of the card. The impact would be higher on lower variants.

According to Mandal, Banks typically incur some expenses for processing offline and online payments and this expense is passed onto merchants as a merchant discount rate (MDR). However, because fuel stations operate on very low margins, if banks charge MDR from them, then they won’t be able to accept card payments. Hence the RBI has allowed banks to charge 1% of the fuel purchase amount as a surcharge from the consumer purchasing the fuel. This arrangement enabled banks to charge zero merchant discount rates (MDR) from the fuel stations.

Also read: ICICI Bank branch manager duped depositors of crores for years to meet targets.

YES Bank credit card rule change: Annual and joining fee reversal threshold

According to the YES Bank Website as of March 29, 2024 “Spends threshold for Annual and Joining Fee reversal will exclude Rent and Wallet Transactions.” However, this change is not applicable for lifetime free YES Bank credit cards.

Experts don’t recommend using YES Bank credit card for utility payments

According to Mittal, many people make regular payments for mobile recharges, electricity, water, and other utilities. These payments when made with a credit card often come with rewards, which is what made credit cards appealing in the first place. “However, there is a growing trend of reducing or eliminating these rewards, and now YES Bank is implementing a charge for them. As of May 1, 2024, it will no longer be advisable to pay utility bills with a Yes Bank credit card,” says Mittal.

“This is an unwelcome move by YES Bank. YES Bank credit card holders will refrain from using their cards for any utility transactions. And hopefully, no other bank will follow this move. I mean, putting a cap on reward earnings in the utility category is understandable as it’s a low-margin category for banks, but charging extra is too much,” Mandal said.

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