These cards can be a smart financial move for those who manage their budget and payments carefully but can become a costly affair for consumers who carry revolving balances or who frequently incur additional fees
Lifetime-free credit cards are highly promoted as a cheap source of credit with neither annual nor joining fees. Although they dont charge overt fees outright, they dont come for free either. Banks and financial institutions keep their revenues intact by charging elevated rates of interest, transaction fees, forex markups, and fees, so customers must be wary of the hidden costs.
A lifetime-free credit card means no annual maintenance charges, compared to other normal credit cards, which charge between Rs 500 to Rs 10,000 annually. Banks still make money in the form of revolving credit interest, late payment fees, and other charges on various transactions.
A lifetime free credit card, as the name suggests, is a credit card that does not charge any annual fees for as long as you use the card. This concept of a credit card with no annual fees forever might seem too good to be true, but lifetime free credit cards do exist, albeit with some caveats. Let’s break down in simple terms what exactly lifetime free means and what to watch out for when applying for such a card.
The Meaning of Lifetime Free
The term “lifetime free” when used for a credit card means that the issuing bank will not charge you any annual or renewal fees for having the credit card. Typically most credit cards have an annual fee ranging from Rs. 500 to even Rs. 1 lakh for premium cards. This fee is charged every year to continue using the services of the credit card. A lifetime free credit card dispenses with this fee forever as long as you keep the account active.
Some key things to note about lifetime free credit cards
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It covers only the annual fees and not any other charges like late payment fees, cash advance fees, etc. Those will still apply if you miss payments or use the card incorrectly.
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Most lifetime free credit cards have an expiry date after which you might have to apply again. This is usually between 5-10 years.
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The “lifetime” term generally means your lifetime, not your family members’ lifetime. The lifetime free benefit is not transferable to heirs.
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The issuing bank can still close the credit card account if it’s inactive or if you default on payments. But as long as you keep the account active you don’t pay annual fees.
Advantages of Lifetime Free Credit Cards
The biggest benefit of lifetime free credit cards is the savings on annual fees over the long run. This makes the cards ideal for those who want to use credit responsibly without incurring recurring costs. Other advantages include:
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Helps avoid card inactivity or closure due to inability to pay annual fees
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Useful as a backup card to build long-term credit history
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Can be used to make occasional payments like subscriptions when primary cards have capped limits
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Rewards and offers comparable to fee-based cards in many cases
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No need to remember to close card to avoid annual fee at renewal
Things to Consider Before Applying
While lifetime free sounds attractive, there are a few things you should evaluate before applying for such a credit card:
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Credit limit – Most banks assign lower limits on these cards compared to fee-based ones
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Rewards – Some lifetime free cards have fewer cashback and reward redemption options
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Acceptance – Premium cards usually have higher acceptance at merchants
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Customer service – Review service quality as some banks may prioritize fee-paying cardholders
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Alternatives – Consider cards with annual fees but higher rewards if your spending is high
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Terms – Carefully read T&Cs in case there are exit clauses for the bank on lifetime free benefit
Summing Up: A Value Proposition, Not a Sales Gimmick
Lifetime free credit cards offer a genuine value proposition for people who want to minimize credit card costs while enjoying the convenience and benefits of plastic money. They are not a marketing gimmick or bait-and-switch tactic. However, you need to assess your spending patterns and card usage before opting for a lifetime free card. If used judiciously and with financial prudence, these cards can help eliminate a common pain point of annual fees.
Reward Points and Cashback Limitations
While most lifetime-free credit cards provide reward points and cashback rewards, these frequently come with stipulations. They may impose a spending cap on rewards, or they may limit cashback to specific products like groceries or gas. Additionally, customers may not always be able to use reward points before they expire because they may have an expiration date.
High Interest Rates on Unpaid Balances
Credit card interest rates in India typically range between 36 per cent and 52 per cent per year. If a cardholder is carrying a carry-forward, interest cost can negate any advantage of not paying a yearly fee. There are additional charges for delayed payment, hence, cardholders should pay dues in full each month.
While there is an interest-free period of 50 days for purchases, cash withdrawals at ATMs using a credit card incur a transaction fee of 2.5 per cent to 3.5 per cent of the amount, along with instant accrual of interest. Similarly, foreign transactions incur forex markup fees of 3 per cent to 3.5 per cent, thus increasing the cost of shopping abroad.
Delayed payments incur penalties ranging from Rs 100 to Rs 1,300, depending on the sum due, and also trigger interest charges against the entire unpaid amount. On top of that, an 18 per cent Goods and Services Tax (GST) is charged on various financial charges, increasing the expenses.
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FAQ
Is a lifetime free credit card actually free?
A Lifetime Free Credit Card is not just another piece of plastic in your wallet, it is a ticket to financial freedom. With no annual fees and a range of rewards and benefits, it is the perfect choice for anyone looking for a straightforward, hassle-free way to make credit purchases.
What is the meaning of free for life credit card?
With free for life credit cards, you do not have to pay annual fees, late fee, cash advance fee and more if you meet the minimum spend criteria. You get complimentary access to international airport lounges for you and supplementary card holders.
What are the disadvantages of a lifetime free credit card?
Hidden Costs to Consider
Despite having a lifetime free credit card, cardholders must remain vigilant about other potential fees. Late payment charges, cash advance fees, foreign transaction fees, and over-limit fees still apply to most no-fee cards. Some banks also impose tighter inactivity conditions on free cards.
What are the benefits of one card lifetime free?
What are the benefits of using the lifetime free One Credit Card? The lifetime free One Credit Card comes with great features like Offers around you, 5X rewards multiplier, low forex, easy EMIs, etc. It’s also a tech-powered card that can be fully controlled using the OneCard app.