So just today i saw that i can add my credit card in my Gpay too
I don’t use UPI a lot
here’s a situation (not hypothetical) and i would love to hear from you guys about it
i have HDFC Millenia Credit card limit of Rs. 1L so would there be any charges if i was to buy ultra short debt MFs worth 28k keeping my credit utilization <30% and pay the card in full on due date, is it like creating a infinite 50-45day free interest glitch with very low to negligible risk?
And to take things a bit more risky i can further more pledge these MF units to get margin and trade with that?
Can i do something like this?
Do check with the Bank who has issued the credit card if there is interest charged if you do this transaction i.e buying MF from the card. The Bank issuing the card, can distinguish between genuine purchase of goods as against buying MF etc. So better check with the bank before purchasing, if not, you will be charged interest from the date of the transaction.
Okay say i have 2 different upi ids linked 2 different savings accounts and then i use credit to pay one of the bank accounts and then use that account to buy the mf i bit indirect but is it possible or anyone who has ever done it?
If you are trying to transfer funds from your credit card to your bank account the interest rate will be very high plus there will be a processing charges. For any such transfer, interest will accrue from the date of the transaction. It is just not viable.
I did a search on your first query and it seems you are not allowed to use credit card for buying MF and you need to route it through a bank account.
1 Like
Althought the idea is great. There is a small issue. According to SEBI any investments made should be from the registered bank account with the broker. so Ideally your transaction should get rejected by default. Have u tried adding funds to broker account from an unlinked bank account, the transaction went through from bank but got rejected by broker and got refunded.
in short in case of CC the broker cant verify the bank account so the transaction should fail.
But for some reason NPS payment gateway allows CC but charges some 0.55% as payment gateway fee.
Thanks for the wonderful insights @neha1101 @ranton137
I did verify it from the CC company and it might only be possible if i add the funds to another back account via UPI but then the said account would be liable to pay standard merchant charges to the bank and the entire process would be a complex web