Kolkata: A credit card can be a great friend in need. However, if you use it injudiciously, it can become very costly. That Indians are fast adopting the credit card culture is amply demonstrated by RBI data. It shows that credit card spending in the country jumped by more than 15% in FY25 over FY24. In March expenditure through credit cards zoomed to Rs 2.02 lakh crore, up from Rs 1.64 lakh crore in March a year ago from Rs 1.68 lakh crore in February 2025.

Therefore, the need to avoid common mistakes associated with credit cards is turning more and more important. Let’s see what these mistakes are. Please remember that these mistakes can cost the user of the card a lot of money.

Footing the minimum bill

Making the minimum payment is a common mistake many people make. It is the least that you must make but not make a habit. If you don’t pay your bill in full you might lead yourself in a debt trap by incurring unnecessary interest charges. Moreover, it could take you a very very long time to liquidate your entire debt. Before you incur a big expenditure through your credit card, you must draw up a repayment plan so that you don’t groan under the weight of debt in the long run.

Overusing the credit limit

Using the full or substantial extent of your credit limit can negatively affect your credit score. The extent of your credit limit you use is known as the credit utilisation ratio. Experts always recommend that one should keep this ratio below 30%, which means if your credit limit is Rs 100, you should not use the card to spend more than Rs 30.

Missing payment deadlines

Missing payment deadlines is a cardinal sin for credit card users. Any late payments invite fat fines. It also harms your credit score. One should never miss credit card payment deadlines by acts of omission or commission. If necessary, set payment reminders.

Making cash withdrawals from ATM

Using a credit card like a debit card ie, to withdraw cash from an ATM is fraught with high costs. It should be the absolutely last resort since these attract a cash advance fee (which is a specific percentage of the withdrawn amount) and an interest with immediate effect.

Not monitoring credit card statements

Not reviewing credit card statements can be hazardous. One can end up paying fraudulent charges or even be subject to billing errors. One should scrutinise credit card statements at least once a month and report discrepancies, if any.