How to do RBL Bank Credit Card Settlement? Advantages, Disadvantages

In today’s era, the use of credit cards has become an important part of everyone’s life. With its help, not only has shopping become easier, but it also helps in handling sudden expenses. However, sometimes due to financial problems, it becomes difficult to pay the entire credit card bill on time. In such a situation, the outstanding amount increases due to late payment charges and increasing interest, which can increase stress. If you are an RBL Bank Credit Card Settlement, Holder and are facing difficulties in repaying your dues, then there is no need to panic.

RBL Bank Bank gives you a great option for credit card settlement. This is a process in which the outstanding amount is settled by agreement between the bank and the customer. In this process, the bank can waive some part of the entire outstanding amount, so that you can get relief from the financial burden.

RBL Bank Bank provides financial relief to its customers through the settlement process. In this process, the bank understands your financial position and gives you the facility to reduce your outstanding amount or pay in easy installments. However, it is important to note that settlement can affect your credit score. But if you have no other option, then this can be the right solution for you.

In today’s article, we will give you complete information about RBL Bank Credit Card Settlement. We will tell you how you can start this process correctly, what documents are required, and important things related to this process.

What is a Credit Card Settlement?

Credit Card Settlement is a process in which you negotiate with your creditor to forgive a part of the outstanding amount on your credit card by making a lump sum payment. It is an agreement that you enter into with your card issuer as a last resort when you see that your credit card debt is increasing.

This can happen due to many reasons ranging from unnecessary expenditure to careless spending habits. When your debt increases, the interest on it also increases, which can make it difficult for you to repay the outstanding amount. If you do not see any way out of this, then you can recommend Credit Card Settlement.

What are the reasons for doing RBL Bank Credit Card Settlement?

Below are some common reasons:

• If a person loses his job, the source of income stops, or there is a huge loss in business, then it may be difficult to repay the loan on time.

• If the expenses suddenly increase due to a major illness or medical emergency, then there may be a shortage of money to repay the loan.

• Many times a person has the burden of more than one loan, which becomes difficult to repay on time.

• There may be problems in repaying the loan due to any natural disaster, accident, or any major crisis in the family.

• If the interest rate of the loan is very high and there is a problem in repaying the installment, then Credit Card Settlement is resorted to.

• Many times a person is not able to manage his expenses and income properly after taking a loan, due to which there is a problem in making the payment.

What are the features of RBL Bank Credit Card Settlement?

Some of its main features are as follows:

• Doing Credit Card Settlement can affect your credit score. It is recorded as “settled” in your credit report, which may cause difficulty in taking a loan in the future.

• This option is available only when the borrower is completely unable to repay the loan and has exhausted all other options.

• In Credit Card Settlement, you do not have to pay the entire loan amount. You can settle your loan by paying only a certain part.

• The process of Credit Card Settlement is easy. You have to contact Home Credit and agree to their terms.

• The settlement process is completed quickly, helping you stabilize your financial situation.

• After settlement, Home Credit issues a No Due Certificate, which proves that your loan is now complete.

What documents are required to do RBL Bank Credit Card Settlement?

Some important documents are required for the Credit Card Settlement process, which is as follows:

• Aadhar Card, PAN Card, Passport, or Driving License, etc.

• Salary slip, Income Tax Return, Bank Statement etc.

• Credit Card Settlement letter, loan details, payment receipts, etc.

• Investment documents, property documents, insurance policies, etc.

What to do before RBL Bank Credit Card Settlement?

Below are some steps that should be followed before Credit Card Settlement:

• First of all, properly check your income, expenses, and all other debts. Know how much amount you can repay.

• Before Credit Card Settlement, share your problem with the bank or lender. Sometimes they can offer you a better solution, such as reducing the EMI or increasing the loan tenure.

• Contact a financial advisor or expert. They can help you make the right decision and explain how RBL Bank Credit Card Settlement will affect your credit score.

• If you decide to go for Credit Card Settlement, read the terms and conditions given by the bank carefully. Make sure that you are not being charged any hidden fees.

• Credit Card Settlement can lower your credit score. This can make it difficult to get a loan in the future. Make a decision keeping this in mind.

• Credit Card Settlement should be the last option. Before that, consider other options like refinancing, reducing EMIs, or asking family and friends for help.

What is the process of RBL Bank Credit Card Settlement?

The process of Credit Card Settlement is explained below in simple words:

• Decide first why you are not capable of paying the entire loan amount. Check your financial condition and payment capability.

• Contact Home Credit customer care or the nearest branch. Tell them about your present financial problems and discuss the RBL Bank Credit Card Settlement option with them.

• Home Credit will understand your situation and will offer a settlement to you. This will be a part of the repayment of the loan amount.

• Be very careful to read the terms that are given in the settlement offer. Understand how the settlement is going to affect your credit score and future loan eligibility.

• Pay the agreed settlement amount as soon as you accept the offer. This is usually in the form of a lump sum.

• After making the payment, take a written proof that is called a No Due Certificate from Home Credit. That proof will be a document for Credit Card Settlement completion, and it will not let any future disputes happen.

• After the settlement, check your credit report and ensure that the details about the Credit Card Settlement are properly recorded.

What are the benefits of RBL Bank Credit Card Settlement?

Credit Card Settlement has many benefits, which are as follows:

• With RBL Bank Credit Card Settlement, you can manage your income and expenses better and avoid financial crises in the future.

• The heavy burden of debt often causes mental stress. Loan Settlement relieves the borrower from this stress and he can find mental peace in his life.

• Through RBL Bank Credit Card Settlement, the borrower gets a chance to get a part of his loan waived.

• This helps to improve his financial condition and gives him relief from heavy financial burden.

• Although RBL Bank Credit Card Settlement may affect the borrower’s credit score, by following the agreement on time and properly, he can gradually improve his credit score.

• RBL Bank Credit Card Settlement improves the financial condition of the borrower.

What are the disadvantages of RBL Bank Credit Card Settlement?

RBL Bank Credit Card Settlement has many disadvantages, which are as follows:

• In the future, the borrower may have difficulty in getting loans from these institutions.

• Through RBL Bank Credit Card Settlement, the entire loan of the borrower is not waived off. He still has to pay some amount, which can affect his financial condition.

• During RBL Bank Credit Card Settlement, the agreement between the bank and the borrower contains many conditions. The borrower is required to follow these conditions, which may limit his freedom.

• After RBL Bank Credit Card Settlement, the borrower’s credit score may be affected.

• RBL Bank Credit Card Settlement may create difficulties in taking new loans or obtaining credit cards in the future.

• Due to RBL Bank Credit Card Settlement, the borrower’s relationship with the bank and other financial institutions may deteriorate.

What is the impact of settlement on the CIBIL score?

Settlement can hurt the credit score. The impact can be seen in the following ways:

• After the settlement process, your credit report is entered with the information that you have “settled” your debt. This entry remains in your credit history for 7 years and can be viewed negatively by lenders or other creditors, which can affect your chances of getting a loan in the future.

• Since settlement means that you have not repaid the entire debt, in the future when you try to get a new loan, banks may look at your credit score and report and reject your application or offer you loans at higher interest rates.

• After settlement, if you have any credit cards or other credit lines, your credit limit may be reduced as creditors think you may be a high-risk customer.

• If your credit score drops, it may be difficult for you to get a loan, credit card, or any other type of credit facility. This can also affect your financial stability, especially if you face a financial emergency in the future.

• When you settle for settlement with your bank, you are not paying off the entire debt but a certain amount that is less than the principal amount. This is viewed negatively by the credit bureaus as it shows that you have been unable to repay your debt. As a result, your credit score may drop.

Conclusion

RBL Bank Credit Card Settlement is an important option for those customers who are unable to pay their credit card dues due to financial problems. This process is a way of settlement between both the bank and the customer, which gives relief to the customer and the bank gets back a part of its dues. However, before adopting such a process, it becomes quite essential to understand its advantages and disadvantages.

Credit Card Settlement Reduces the Balance Owed and Provides Economic Respite. However,r it can negatively impact your credit score and make it arduous to acquire a loan or a credit card in later periods. Therefore, it is important to check your financial situation and long-term goals before settlement. If possible, other payment plans can also be considered instead of settlement, such as an EMI option or repayment plan.

Apart from this, during the settlement process, it is also important to ensure that the agreement made with the bank is in writing and that all the terms are clear. This can avoid any disputes in the future. After the settlement, you should monitor your credit report to ensure that the correct information is recorded on your report.

Frequently Asked Questions (FAQ’s)