The year 2025 brings significant updates in the world of credit cards. These updates range from fee adjustments to changes in reward structures and eligibility criteria. Consumers in India, the US, and other major markets will need to stay updated with these changes to avoid unnecessary charges and continue gaining maximum value from their credit cards.
With rising operational costs and new regulatory compliance requirements, banks and financial institutions have started revising their credit card policies. For cardholders, this means re-evaluating current cards, understanding new terms, and possibly switching to better alternatives.
As the payment ecosystem grows more digital and reward-based, users must now adapt their card usage strategies to keep pace with these evolving systems. Let us understand what’s changing and how to respond efficiently.
Overview of Credit Card Changes in 2025
Several banks and financial institutions have updated their credit card offerings in 2025. These include:
- Revisions in annual fees, especially on premium and co-branded cards.
- Changes in cashback policies for specific categories, like online shopping and fuel.
- Withdrawal of certain complimentary services, such as airport lounge access.
- Introduction of usage-based service fees like fuel surcharge fees beyond limits.
- Adjustments in interest rates or APRs on purchases and cash advances.
A noticeable trend in 2025 is the shift toward charging customers for excessive or irregular spending categories. Additionally, reward categories are being fine-tuned to promote spending in specific sectors like travel, fashion, and food delivery.
Examples of Recent Policy Revisions
| Credit Card Provider | Type of Change | Notable Details | Effective From |
|---|---|---|---|
| Axis Bank (REWARDS Card) | Revised Annual Fee Waiver Conditions | Minimum spend threshold increased | 20 June 2025 |
| Axis Bank (Flipkart Card) | Cashback Adjusted + Lounge Access Removed | Myntra cashback improved; lounge access ends | 20 June 2025 |
| Kotak Mahindra Bank | New Fee Introduced for Fuel Spends | 1% fee for monthly fuel spends above ₹15,000 | 1 June 2025 |
| First Direct Bank | Increase in Interest Rates | Purchase APR increased from 19.9% to 24.9% | 15 April 2025 |
| United Credit Cards | Annual Fee Increased | Personal cards: $170; Business: $245 | April 2025 |
Impact of Fee Changes
Annual and Renewal Fees: Many banks have revised annual fees upward, particularly on premium cards. This change is generally paired with enhanced benefits like higher cashback or exclusive offers, but not always. It’s essential for cardholders to assess if the benefits justify the new fee.
Hidden Charges: Banks are increasingly introducing charges in niche categories such as international transactions, fuel purchases beyond a monthly threshold, and even certain types of reward redemptions. These can catch customers off guard if they are not closely monitored.
Interest Rates: Interest rates (APRs) on both purchase transactions and cash withdrawals have increased across several banks. This means carrying forward any balance is now more expensive than before.
How to Manage Credit Card Fees in 2025
Choose Cards That Align With Your Spending
Instead of having multiple cards, focus on two or three that align with your lifestyle. For instance, a person spending primarily on groceries and online shopping should pick a card that offers better cashback or rewards in those specific categories.
Pay the Full Balance Monthly
Avoiding interest starts with paying your total outstanding amount by the due date. This also helps maintain a strong credit score and saves significantly on long-term finance charges.
Be Aware of Transaction-Based Charges
Know the charges applicable for transactions like fuel, EMI conversions, wallet loads, and cash withdrawals. Most of these are now chargeable beyond fixed thresholds.
Track Fee Waiver Conditions
Several cards offer a waiver of the annual fee if a certain amount is spent within a year. Make note of these thresholds and try to align your purchases accordingly to avoid paying the fee.
Maximize Benefits Under the New Structure
As banks are tweaking the reward systems, here are practical steps to continue benefiting from credit cards in 2025:
- Use specific cards for designated categories. For example, a co-branded shopping card may now offer improved cashback for Myntra but reduced rewards elsewhere.
- Regularly redeem your accumulated reward points. With ongoing revisions, some reward points may expire or reduce in value after a certain time.
- Take advantage of milestone-based benefits such as free vouchers or bonus reward points. These often go unnoticed but provide good value when achieved.
- Monitor communication from banks. Changes in terms are often communicated via SMS or email—review these carefully.
Tips for New Credit Card Applicants in 2025
If you are planning to apply for a new credit card this year, keep the following tips in mind:
- Compare reward-to-fee ratio: A card with a ₹1,500 annual fee must offer you at least ₹1,500 worth of benefits or cashback to break even.
- Check spend categories: Make sure your most frequent expenses fall under the high-reward zones of the card.
- Review customer service ratings: With many changes in policies, good customer service can be a critical factor in resolving disputes or mischarges.
- Know the onboarding offers: Most new cards offer welcome bonuses or cashback. These offers vary widely among banks in 2025.