How to Send Money from Credit Card to Bank Account in India

In today’s fast-paced financial world, knowing how to send money from credit card to bank account can be a lifesaver during emergencies or when you need quick cash flow. Whether you’re dealing with unexpected bills, investments, or simply managing daily expenses, transferring funds from your credit card to your bank account offers flexibility. In India, with services like NEFT, RTGS, and popular e-wallets, this process is straightforward but comes with fees and considerations. This guide from Finlecture.in breaks it down step by step, helping you make informed decisions while avoiding common pitfalls.

Why Transfer Money from Credit Card to Bank Account?

Transferring funds from your credit card to your bank account isn’t just about convenience—it’s a strategic move for many Indians facing cash crunches. Here are some key reasons:

• Emergency Funds: Sudden medical bills or repairs? A quick transfer provides immediate access to cash—though building a proper emergency fund is always the smarter long-term strategy.
• Bill Payments: Pay utilities, rent, or EMIs directly from your bank when credit cards aren’t accepted.
• Cash Flow Management: Bridge gaps during salary delays or business slowdowns.
• Investment Opportunities: Seize time-sensitive deals like stock purchases or mutual funds.
• Travel Expenses: Load your bank for easy access abroad without carrying cash.
• Loan Repayments: Manage home loans or personal loans efficiently.

However, remember that this is essentially a cash advance, which attracts interest and fees. Always weigh the costs against the benefits.

Ways to Transfer Money from Credit Card to Bank Account Online in India

In India, banks like Axis Bank, HDFC, SBI, and others offer multiple methods for seamless transfers. Here’s how you can do it:

1. Using E-Wallets for Money Transfer

E-wallets like Paytm, PhonePe, or Google Pay act as intermediaries, making transfers quick and digital. This is popular in urban areas like Bengaluru, Mumbai, or Delhi.

• Steps:
  1. Download and link your e-wallet to your bank account.
  2. Add money to the wallet using your credit card.
  3. Transfer the loaded funds to your bank account via UPI or IMPS.
• Pros: Instant in many cases; user-friendly apps.
• Cons: Fees (2-3%) and potential daily limits (e.g., ₹1 lakh on Paytm).
• Example: If you’re in Karnataka, using Airtel Payments Bank integrated with your credit card can make funds from your credit card to your bank account seamlessly transferred.

2. Internet Banking or Mobile Apps

Most Indian banks provide direct options through their apps or websites. For instance, Axis Bank’s platform supports NEFT, RTGS, and IMPS.

• NEFT (National Electronic Funds Transfer): Ideal for non-urgent transfers under ₹2 lakh. Available 24/7, but settles in batches.
• RTGS (Real-Time Gross Settlement): For amounts over ₹2 lakh; real-time processing during banking hours.
• IMPS (Immediate Payment Service): 24/7 instant transfers up to ₹5 lakh.
• Steps:
  1. Log in to your bank’s app (e.g., Axis Mobile or HDFC NetBanking).
  2. Select ‘Credit Card’ > ‘Fund Transfer’.
  3. Enter the amount, bank details, and confirm.
• Pros: Secure and bank-backed; lower fees for intra-bank transfers.
• Cons: Processing time varies; interest starts immediately on the credit card.

3. ATM Cash Advance

If digital isn’t your preference, head to an ATM—perfect for rural areas in states like Karnataka or Uttar Pradesh.

• Steps:
  1. Insert your credit card and enter PIN.
  2. Select ‘Cash Advance’ and withdraw the amount.
  3. Deposit the cash into your bank account at a branch or ATM.
• Pros: Immediate cash; no internet needed.
• Cons: High fees (3-5% + ATM charges) and daily withdrawal limits—check the latest ATM withdrawal limits & transaction charges in India for your bank.

4. Phone Banking or Customer Service

For those in remote locations without strong internet, a simple call works.

• Steps:
  1. Call your bank’s credit card helpline (e.g., Axis Bank: 1860-419-5555).
  2. Request a transfer and provide details.
  3. Confirm via OTP.
• Pros: Personal assistance; available 24/7.
• Cons: May take longer to process.

5. Cheque to Self

A traditional method still used in India.

• Steps:
  1. Write a cheque from your credit card account to yourself.
  2. Deposit it at your bank branch.
• Pros: No tech barriers.
• Cons: Clearing time (2-3 days); fees apply.

6. Third-Party Services

Platforms like Western Union or Paysend allow global transfers, but for India, local apps like Cred or Wise are better for credit card to bank transfers.

• Note: Always check RBI guidelines to ensure compliance.

Fees, Interest, and Charges Involved

When you transfer money from credit card to bank account, expect:

• Processing Fees: 1-4% of the amount (e.g., ₹500 on ₹50,000 at 1%).
• Interest Rates: 2-3.5% per month from Day 1 (no grace period like purchases).
• GST: 18% on fees.
• Example Calculation:
  • Transfer: ₹50,000
  • Fee: 3% = ₹1,500
  • Interest (if unpaid for a month at 3%): ₹1,500
  • Total Cost: ₹3,000 + GST

Compare cards: HDFC or SBI might offer lower rates during promotions.

Do’s and Don’ts for Safe Transfers

Do’s:

• Check your credit limit and utilisation ratio (keep below 30% to protect your CIBIL score).
• Understand terms—read RBI’s fair practices code.
• Plan repayments to avoid debt cycles.
• Use secure networks for online transfers.

Don’ts:

• Avoid frequent transfers; it signals financial stress to lenders.
• Don’t use for gambling or speculative investments.
• Never share OTPs or card details.
• Skip if cheaper alternatives like personal loans exist.

Impact on Your Credit Score

High credit utilisation from transfers can drop your score by 50-100 points. In India, maintain timely repayments to build credit health. Tools like CIBIL or Experian can help monitor.

Alternatives to Credit Card Transfers

• Personal Loans: Lower interest (10-15% p.a.) from banks like ICICI—explore more in our investment advice section.
• Overdraft Facilities: On savings accounts.
• Peer-to-Peer Lending: Apps like LenDenClub.
• Build an Emergency Fund: Aim for 3-6 months’ expenses.
• For investment-focused transfers, use our Stock Average Calculator or check the best stocks for SIP investment to plan better long-term.

FAQs on How to Send Money from Credit Card to Bank Account

Can I transfer money from credit card to bank account without charges?

No, most methods charge fees and interest. Look for promotional offers from banks like Standard Chartered.

Is it safe to transfer from credit card to bank?

Yes, if done through official channels. Avoid unverified third-parties to prevent fraud.

How long does the transfer take?

Instant via IMPS; 1-2 days via NEFT/RTGS.

Can I transfer to someone else’s bank account?

Yes, but verify details to avoid errors.

What if I have a foreign credit card?

Check with issuers like Visa/Mastercard for India-specific rules.

Conclusion

Mastering how to send money from credit card to bank account empowers your financial decisions in India. Whether using e-wallets for quick transfers or ATM advances for cash, prioritize costs and repayment. At Finlecture.in, we recommend treating this as a short-term solution—focus on budgeting and savings for long-term stability. If you’re in Karnataka or elsewhere, consult your bank for personalized advice. Stay financially savvy!

Explore more tools and guides on our Financial Planning Calculators page or dive deeper into personal finance topics.

For more tips on money transfer services, cash advances, or transferring funds seamlessly, explore Finlecture.in’s resources. Remember, responsible use builds wealth!