Prepayment, Pre-Closure and Part Payment: Everything you need to know

Making a part payment of a personal loan or choosing any of the other prepayment options offers many benefits. It reduces your interest burden and makes you credit-free early. You can choose the right option to increase your savings by understanding how they differ. 

Read on to learn the difference between these loan repayment methods.

What is the Part Payment of a Personal Loan?

Part-payment, as the name suggests, means repaying a part of the total loan amount when you have idle funds. This reduces the outstanding balance; hence, your EMIs and interest amount also decrease. 

Consider the following example:

  • You get a loan of ₹10 lakhs for 5 years
  • The interest and EMI are calculated on ₹10 lakhs, which is the borrowed amount

Say you get surplus funds and plan to make a part payment of a personal loan of ₹5 lakhs after 2 years. Then, the interest and EMI will be calculated on the remaining ₹5 lakhs for 3 years. This helps decrease your interest outgo and minimise your borrowing costs for the remaining loan tenure.

What is the Prepayment of a Personal Loan?

Prepaying your loan is also called foreclosing. It refers to when you repay the entire loan before the loan tenure ends. Usually, financial companies allow borrowers to fully prepay the principal amount after the first year of repayment. 

The prepayment of a loan can be beneficial as you save on interest. Consider the following scenario:

  • Loan amount: ₹2 lakhs
  • Interest rate: 15%
  • Tenure: 5 years

Here’s what you’ll need to pay:

  • EMI: ₹4,758
  • By the end of year 1: ₹29,039 towards the principal amount and ₹28,057 as interest

In the aforementioned hypothetical example, prepaying the entire loan will save you approximately ₹57,422 as interest.

What is the Pre-closure of a Personal Loan?

The option of pepaying the outstanding amount in a single instalment before the loan term ends is what this means. You can reduce your interest liability and close your loan account before the term, helping you save additional funds.

The financial institution will calculate the balance after considering the following parameters:

  • Total outstanding amount
  • Remaining loan term
  • Interest paid

Remember to collect the ‘No-dues’ certificate after the pre-closure of a personal loan as well as the original documents from the financial institution.

Consider the following situation:

  • You take a loan of ₹5 lakhs for 5 years
  • You pre-close the loan in a single instalment after 2 years
  • Then, you will save on interest payments for 3 years once you pre-close your loan

Difference Between Part Payment, Prepayment and Pre-closure

Check out this table to understand how these prepayment methods differ:

ParameterPart Payment of a LoanPrepayment of a LoanPre-closure of a Loan
Principle loan amountThe principal amount of your loan reducesThe principal amount of your loan reducesRepayment of the entire outstanding loan amount
EMIThe EMI payment will decreaseThe EMI payment will decreaseNo EMIs since the entire loan amount is paid off
Interest rateRemains the sameReducesThe rate of interest remains the same, but you do not need to pay any interest since the entire loan amount is paid off

What to Consider Before Prepaying Your Loan?

Before making a loan prepayment, note the following criteria:

  • Current interest rates of the loan
  • Remaining tenure of the loan
  • Future financial goals and fund requirements
  • Your finances and repayment capacity
  • Terms and conditions of the lender, such as prepayment fees

By understanding these practices of prepaying loans, you can service your debt easily and manage your finances effectively. Try to plan for prepayment right when you are applying for a personal loan. 

With Fibe’s Instant Cash Loan, you can get up to ₹5 lakhs at affordable rates and zero pre-closure charges. Download the Personal Loan App or log in to our website today to get the required funds with ease!

FAQs on Part Payment Vs Prepayment Vs Pre-Closure

How are prepayment and pre-closure different?

Here’s how these financial terms differ: 

  • Prepayment means repaying a part or the full loan before the end of a loan tenure
  • Pre-closure means repaying the full loan amount in a single instalment before the end of the loan tenure

Is foreclosing and pre-closing a personal loan the same thing?

Yes, these terms can be used interchangeably since, in both cases, you repay the borrowed amount as a lump sum and close your loan account early. This helps you save on interest charges. However, you should only proceed after factoring in the fees levied by the financial institution. 

How is partial prepayment and full prepayment different?

Here’s how:

  • Partial payment means repaying only a part of a loan amount before the tenure ends
  • Full prepayment means repaying the total loan amount in a lump sum before the end of the tenure

Is pre-closure of a loan good or bad?

It can be beneficial for you to pre-close a loan since it:

  • Helps decrease your interest costs
  • Makes you debt-free earlier

Remember, you must consider this option only when you have surplus funds and do not deplete all your emergency funds.

Union Bank of India Balance Enquiry Number

Keeping tabs on your Union Bank account balance is simpler than you think. Whether you prefer a quick missed call, an SMS or checking online, there are multiple ways to get your balance in seconds. You don’t even need to visit a branch. Just make sure your mobile number is registered with the bank and you’re good to go.

Read on to learn more about these options.  

Different Modes Available to Check Union Bank Account

Here’s a snapshot of all the methods available before we get into the details:

MethodHow It Works
Missed CallDial 09223008586 from your registered number and get your balance via SMS
SMS BankingSend a text with the right code to 09223008486 and receive balance details instantly
ATMInsert your debit card, enter your PIN and select Balance Check or Mini Statement
WhatsApp BankingSend ‘Hi’ to 9666606060 on WhatsApp and follow the prompts for balance enquiry
Net BankingLog in to the Union Bank portal and click on Balance Enquiry
PassbookVisit your nearest branch and get your passbook updated by an executive

6 Ways to Check the Union Bank Account Balance 

Checking your Union Bank balance is a quick and pretty simple process. Here’s a step-by-step breakdown of every method so you can pick what works best for you:

  1. Check Union Bank Balance Through a Missed Call 

The easiest way – no typing, no login, just a quick call.

  • Step 1: Dial 09223008586 from your registered mobile number
  • Step 2: Let it ring once and disconnect 
  • Step 3: You’ll receive an SMS with your latest account balance shortly

Please note: An SMS charge of ₹2.50 + GST applies for domestic SMS and ₹1.20 + GST for international SMS.

  1. Union Bank of India Balance Enquiry Via SMS 

Prefer texting? Here’s how to check your balance via SMS.

  • For primary account balance:
    • Step 1: Open your SMS app
    • Step 2: Type UBAL and send it to 09223008486
    • Step 3: You’ll receive your balance details via SMS
  • For other account balance:
    • Step 1: Type UBAL<space>Account Number
    • Step 2: Send it to 09223008486
  • For mini statement:
    • Step 1: Type UMNS<space>Account Number
    • Step 2: Send it to 09223008486
    • Step 3: Your last few transactions will be sent to you via SMS

Please note: An SMS charge of ₹2.50 + GST applies for domestic SMS and ₹1.20 + GST for international SMS.

Also Read: How to Get Your Bank Account Statement 

  1. Check Union Bank Balance at the ATM 

Have your debit card handy? Here’s how to use the ATM for a quick balance check.

  • Step 1: Go to your nearest Union Bank ATM
  • Step 2: Insert your debit card and enter your PIN
  • Step 3: Select the ‘Account Statement or Balance Check’ option
  • Step 4: Your balance and recent transactions will appear on screen

To find your nearest Union Bank ATM:

  • Type UATM<space>Pin Code<space>Location/City
  • Send it to 09223008486

Also Read: Union Bank of India Bank Statement 

  1. Union Bank of India Balance Check Via WhatsApp Banking 

Union Bank offers balance enquiry through its WhatsApp service called Union Virtual Connect (UVConn).

  • Step 1: Save 9666606060 as a contact on your phone
  • Step 2: Open WhatsApp and send ‘Hi’ to this number
  • Step 3: Complete the one-time registration process
  • Step 4: Send ‘Hi’ again once registered
  • Step 5: Select the number corresponding to ‘Balance Inquiry’ from the menu

Your balance will be shared right there in the chat.

  1. Union Bank of India Balance Enquiry Using Net Banking 

For those who prefer checking online, the net banking portal makes it simple.

  • Step 1: Visit the official Union Bank of India website
  • Step 2: Click on ‘Internet Banking’
  • Step 3: Enter your User ID and password to log in
  • Step 4: Click on the ‘Balance Enquiry’ option
  • Step 5: Your current account balance will be displayed on screen

Also Read: How to Check Bank Balance Online?  

  1. Union Bank Account Balance Using a Passbook 

Prefer the old-school way? Your passbook works just fine.

  • Step 1: Carry your passbook and visit your nearest Union Bank branch
  • Step 2: Request the bank executive to update your passbook
  • Step 3: Once updated, you can see your current balance and all recent transactions

Also Read: How to Download Bank Account Statement as a PDF?

[Source: Balance Enquiry – Union Bank]
[Source: Balance Enquiry – Union Bank]

Checking your bank account balance is essential to track your spending and cut down on unnecessary expenses. It helps you know whether you can make a purchase or need additional funds for that.  

To get excess funds, you can opt for an Instant Cash Loan of up to ₹10 lakhs from Fibe. You can enjoy quick sanctions with a simple application process and minimal paperwork. Download the Fibe Personal Loan App or visit our website to get your journey started.  

FAQs on Union Bank of India Balance Check

What is the missed call number to get the Union Bank account mini statement?  

The UBI balance check number for the missed call facility to get your account balance is 09223008586.  

How can I check my Union Bank balance online?  

You can check it online through the Vyom- Union Bank of India application or the net banking portal. Log in to your account using the User ID and password. Click on the ‘Account Statements’ option.  

How can I check my Union Bank of India balance by missed call?  

All you have to do is dial this number, 09223008586, which is the Union Bank balance check number.  

How to check the Union Bank passbook online?  

You can check the passbook online through the Vyom- Union Bank of India application or the net banking portal.  

How do I check my Union Bank balance via SMS? 

To check the balance of your primary Union Bank account, send ‘UBAL’ to 09223008486.  

How do I register my mobile number with the Union Bank of India? 

To register your mobile number with the bank, you will have to fill in a form at your home branch.  

What is the customer care number for Union Bank balance inquiries? 

You can check your UBI account balance by giving a missed call. The balance check number of Union Bank is 09223008586. 

What is the cost of using the Union Bank of India missed call service?  

You will have to pay an SMS charge of ₹2.50 + GST for domestic SMS and ₹1.20 + GST for international SMS. Banking. 8 Jan 2024. Our top picks.

What is EMI and How to Calculate It?

Thinking of taking a loan but confused about how you’ll repay it every month? Wondering what EMI really means or how it’s calculated? You’re not alone. Many first-time borrowers often ask questions like: What is the full form of EMI? How is EMI calculated? Are there different types of EMIs?  

Here, we’ll break down everything you need to know about EMIs in the simplest way possible. From understanding the meaning of EMI to exploring the types and learning how to calculate it—you’ll find answers to all your questions right here.  

Read on to learn the meaning of EMI, how it works and more.  

What is EMI and its full form? 

EMI stands for Equated Monthly Instalment. It’s one of the easiest and most popular ways to repay a loan. There are different ways to pay back loans — like balloon payments or interest-only options — but EMIs are the most common.  

Here’s why: 

  • With EMIs, you pay a fixed amount every month. This amount is calculated based on the total loan amount (called the principal), the interest rate and the time you choose to repay it. 
  • Since you know exactly how much you need to pay each month, it’s easier to manage your finances. You simply keep paying this amount every month until your loan is fully paid off. 

How does EMI (Equated Monthly Instalment ) Work?  

Taking into account the loan amount, the financial company adds interest to it based on your repayment duration. This amount is spread across the tenure, which results in your EMIs. Thus, all these three terms influence your EMIs.  

Here’s what your repayment will look like if you take a loan of ₹1,00,000: 

ParticularsDetails
Loan Amount₹1,00,000
Interest rate14%
Tenure12 months 
Total interest applied₹7,748
Total repayment amount₹1,07,748
EMI for 12 months₹8979

Keep the following in mind: 

  • The EMI amount stays the same throughout the tenure of the loan.  
  • As you pay an instalment, your total payable reduces by that figure. 
  • After the last payment, the lender will close your loan.  
  • Collect a No Objection Certificate (NOC) from them.  
  • Check your credit report to ensure the loan account is closed and your credit score increases.  

Also Read: Tips to Lower EMI For a Personal Loan 

How is EMI Calculated?  

Here are the 2 methods that lenders use to calculate EMIs: 

  • Fixed-Rate Method 

Under this method, the calculated interest amount depends on the principal amount. To calculate the instant cash loan EMI, lenders calculate the total sum of principal and interest. This amount is then divided into equal instalments. Since the interest rate remains fixed, the principal and interest component of the EMI stay the same throughout the tenure.  

Here is the formula for the fixed-rate method: ((P x R x N) + P)) / (N x 12) 

Where, P is the principal amount, R is the rate of interest and N is the tenure of the loan  

  • Reducing Balance Method  

Under this method, the interest amount varies with the balance after each EMI payment, i.e., the outstanding amount. Because of this, the interest and principal components vary for every instalment.  

However, the EMI will remain fixed throughout the tenure. As you continue to make payments, the principal increases and the interest decreases with every EMI.  

Here is the formula for this method: P x R x (1+R)^N/[(1+R) ^ (N-1)] 

Where, P is the principal amount, R is the per-month rate of interest and N is the loan tenure in months.  

Key Factors That Affect Your (Equated Monthly Instalment) EMI 

You should always consider the following factors that impact your monthly instalment amount: 

Principal Amount 

  • This is the actual loan amount you borrow. 
  • Higher loan = higher EMI, Lower loan = lower EMI. 

Interest Rate 

  • It’s the extra amount you pay on top of the loan. 
  • Higher interest = higher EMI, Lower interest = lower EMI. 

Loan Tenure 

  • This is the time you get to repay the loan. 
  • Longer tenure = smaller EMIs, Shorter tenure = bigger EMIs. 

Credit Score 

  • A good credit score means you’re seen as a low-risk borrower. 
  • With a high score, you might get lower interest and better EMI options. 
  • With a low score, lenders may charge higher interest, which increases your EMI. 

Check your Credit Score 

Armed with this information, you can choose a better repayment plan. Remember, your interest rates have a significant influence on your EMI amount. Thus, it’s important to choose a lender that offers pocket-friendly rates like Fibe. With our Instant Cash Loan, you can get up to ₹5 lakhs at an affordable rate.  

You only have to meet a few basic criteria, submit minimal documentation and apply online to get the funds in just a few minutes. Download the Personal Loan App or register on our website to apply.  

FAQs on EMI 

What is the formula used in calculating EMI on loans?  

The EMI calculation formula under fixed rate is ((P x R x N) + P)) / (N x 12). Under reducing balance, the formula is P x R x (1+R) ^N/[(1+R) ^ (N-1)]. In both cases, P is the principal, R is the interest rate and N is the tenure.  

How is EMI deducted?  

Generally, the financial institution automatically deducts the EMI amount from your bank account on the payment date.  

Is EMI a good or bad option? 

EMI is a good credit repayment option since it allows you to reduce your repayment burden by allowing you to pay in budget-friendly instalments instead of a lump sum amount.  

What is the difference between an EMI and a loan?  

A loan is a financial product that allows you to borrow funds. EMI is a repayment method for loans where you pay a fixed amount for a fixed duration.  

What is the meaning of the EMI levy date?  

It is the specific date on which you are required to pay the instalments of your loan every month.  

What Is IMPS? – Full Form, Features, Steps, Charges and More

The full form of IMPS in banking is Immediate Payment Service. This fund transfer facility gives you real time updates on your online payments, including bills, fees, tickets, merchants and more. Knowing what is IMPS is important for transferring funds easily as you can use this facility for urgent needs. 

However, there are limits, charges and timings that you should know when making hassle-free transfers. Now that you know the full form of IMPS in banking, read on to learn about more.

What is IMPS Transfer?

Following are some points to give you a complete overview of this facility: 

  • It was launched by the National Payment Corporation of India (NPCI) on 22nd November 2010
  • It’s an electronic money transfer facility for making interbank fund transfers
  • You can opt for it on mobile, Internet, ATM and SMS banking channels
  • Only the banks licenced by the Reserve Bank of India (RBI) can provide this facility
  • With this feature, you can monitor payments in real time, even when banks are closed
  • It is among the most accessible options for secure and cost-effective banking
  • It enables you to move money at any time and any place of your choosing

Features of IMPS

Now that you know the meaning of IMPS, here are some of its features.

  • Secure: It follows encryption and authentication protocols to protect your funds
  • Flexible: This facility is available 24/7, even on bank and gazetted holidays
  • Accessible: Available through net banking, mobile banking and more
  • Versatile: Can initiate Peer-to-Peer (P2P) or Person-to-Merchant (P2M) payments easily
  • Instant: Funds get transferred instantly, in real time, so you do not have to wait
  • Easy: You can transfer funds effortlessly with the recipient’s banking or contact details

Types of IMPS Transfers

Here are different channels through which you can make an IMPS fund transfer:

  • Mobile Banking: Send money with the recipient’s mobile number linked to a bank account and a seven-digit MMID number
  • Net Banking: With beneficiary’s account number and IFSC code, you can easily send money online
  • Bank’s ATM: ATMs allow you to transfer money, given that you have the beneficiary’s mobile number and MMID
  • SMS: Send a text based on the bank’s prescribed format using the beneficiary’s MMID number to initiate a fund transfer

IMPS Transaction Limit and Timings

While IMPS is a quick and easy option, it has some restrictions regarding timing and amount. In terms of the IMPS transaction limit, the RBI allows up to ₹5 lakhs per day on transactions, except for SMS and IVRS. Similarly, the IMPS facility is available for all hours of the day, but a few banks have restricted timing for adding beneficiaries. 

This helps banks avoid any fraudulent activities and take immediate action. So, ensure you check the timings when adding a beneficiary for easy payments.

IMPS Transaction Charges

Here are the charges for IMPS levied by some prominent banks in the country:

BankCharges
Axis Bank₹2.5 – ₹10 per transaction
HDFC Bank₹3.50 – ₹15 per transaction
ICICI Bank₹2.5 – ₹15 per transaction
Kotak Mahindra Bank₹2.5 – ₹15 per transaction
Punjab National Bank₹5 – ₹12 per transaction
State Bank of IndiaNil
YES Bank₹5 – ₹15 per transaction

Disclaimer: Note that these charges for IMPS transfer are exclusive of GST. They also depend on your transaction amount and are also subject to change at the bank’s discretion. Furthermore, they are for outward transactions only. So, make sure to check with your bank before initiating the transfer.

How to Transfer Money Through IMPS

Here are the steps to follow for IMPS transfer:

  1. Log in to your bank’s net or mobile banking platform
  2. Click on the ‘Transfer’ option 
  3. Select ‘Add Beneficiary’ or ‘One Time Transfer’
  4. Select ‘IMPS’ as the transfer method
  5. Add required beneficiary details (MMID, account and mobile number, etc.)
  6. Enter the amount and add a remark
  7. Click on ‘Confirm’ to receive OTP on your registered mobile number
  8. Enter the OTP to complete the transaction

Advantages of IMPS

Whether it’s a personal or business transaction, IMPS offers flexibility, speed, and reliability, making it an essential tool for modern banking needs. Here’s what makes IMPS stand out:

  • Speed and Security: IMPS processes transactions in real time and employs advanced security protocols to ensure safe and fast fund transfers
  • Convenient Access: IMPS is accessible via internet banking and mobile platforms, giving you the flexibility to manage transactions from anywhere
  • Always Available: This service operates 24/7, including weekends and public holidays, making it ideal for urgent money transfers
  • Effortless Beneficiary Setup: Adding beneficiaries is simple—just use the recipient’s mobile number and MMID for quick setup without the need for account details
  • Real Time Alerts: Both sender and receiver get immediate notifications, keeping you informed about the transaction status
  • Multi-Purpose Tool: IMPS isn’t just for fund transfers; you can also use it for merchant payments, mobile banking, and other financial activities

Points to Remember for IMPS

In addition to the timing, transfer limit and charges for IMPS, here are some other key points to note:

  • You can only make an IMPS transfer if you have registered for mobile banking services
  • You must have the Mobile Money Identifier (MMID) and MPIN
  • You can also make fund transfers with bank account number and IFSC

How to Register for IMPS in 2024

The registration process for IMPS is as follows:

  1. Download your bank’s mobile banking app 
  2. Register for mobile banking 
  3. Note the MMID and MPIN number for your account

Using this, you can receive money into your account as well as send funds up to ₹5 lakhs. 

With these steps, it is easy, fast and convenient to transfer money. This is why many lenders opt for this option to disburse funds to the borrower, allowing them to give instant loans, like those offered by Fibe.

With the Fibe Instant Cash Loan, you can get up to ₹5 lakhs in a few minutes as we have a quick approval and minimum documentation policy. You also enjoy pocket-friendly rates with no prepayment charges. Download our Personal Loan App or go to our website to apply now to get the required funds!

FAQs on IMPS Transfer

What is IMPS and how does it work?

It’s a real time fund transfer facility which stands for Immediate Payment Service. For this, you have to register for mobile banking. Additionally, you require the receiver’s mobile number and Mobile Money Identifier (MMID) or bank account details. Using these details, you can send or receive funds instantly.

What is an example of an immediate payment service?

Immediate Payment Service (IMPS), Real Time Gross Settlement (RTGS) and UPI are some examples of instant payment options available in India.

What is the IMPS transfer limit?

As per the RBI guidelines, the maximum daily limit for IMPS transfer is ₹5 lakhs except for SMS and IVRS, but it can vary depending on the banks.

What happens if IMPS is not credited?

If the transaction fails, wait a few minutes before initiating another transaction. If the amount isn’t credited to the beneficiary’s account but debited from your account, it will get reversed within two working days.

What is a Cheque Bounce? Causes and Prevention Tips

Under the Negotiable Instruments Act of 1881, cheque bounce is categorised as an offensive act. If your cheque bounces for any reason, you must face consequences such as monetary penalties, imprisonment or both. It can also impact your credibility and lead to other such negative effects.  

Read on to learn about the meaning of cheque bounce, its reasons and the charges.  

What is a Bounced Cheque? 

A cheque bounce happens when a cheque payment fails due to reasons like insufficient funds, signature mismatch or an expired cheque. The meaning of cheque bounce is that the bank cannot process the payment, causing the cheque to be returned unpaid. A cheque is a written promise from the payer (the person issuing it) to the payee (the person receiving it) but if it doesn’t go through, it results in a cheque return or cheque bounce. 

Here are some important points to know: 

  • Your bank transfers the amount from your bank account to the payee’s account. 
  • The Reserve Bank of India (RBI) released a new rule regarding this in August 2021. As per this rule, individuals who plan on using cheques need to maintain a minimum bank balance.  
  • If you don’t maintain the required balance, the issued cheque will bounce. This rule applies to all private and national banks.  

Why Do Cheques Bounce? 

Check out the various reasons that can lead to a bounced cheque: 

Insufficient Funds 

A cheque can return or bounce if your account needs more funds. Since it is an offence according to the Negotiable Instrument Act of 1881, it attracts a penalty. Besides the monetary penalty, it can also lead to imprisonment for some years.  

Expired Cheques  

The date mentioned on a cheque states its validity. If you present a cheque to a bank for payment after its expiration date, the cheque will be returned.  

Damaged Cheques 

Another reason for cheque return is damaged or disfigured cheques. The financial institution may return your cheque if it is torn or folded or if the written details are not visible. To avoid these circumstances, try not to fold the cheque and keep it safe from damage.  

Payer Stops Payment 

The payer can request the financial institution to stop payment on the cheque. The bank will return the cheque in such a case.  

Mismatch of Details 

A financial institution can also return a cheque if the information, like the account number or the signature, doesn’t match their records. It creates concerns about the authenticity of the cheque, and therefore, the bank will return it.  

Check Bounce Penalty 

Here are the consequences of a cheque bounce: 

  • The payee can take legal action against you if you fail to make the payment within 30 days of the official notification 
  • A bounced cheque can lead to monetary penalties as well as imprisonment in some cases 

What are the Charges for a Bounced Cheque? 

Here are the cheque bounce charges levied by top financial institutions: 

BankCharges
Axis BankCheques deposited for local clearing at the home branch: ₹500
Bank of BarodaInward Return: Up to ₹1 lakh: ₹150Above ₹1 lakh to less than ₹1 crore: ₹250More than ₹1 crore: ₹500
Outward Return:Up to ₹1 lakh: ₹250Above ₹1 lakh to less than ₹1 crore: ₹500More than ₹1 crore: ₹750
Technical Reason: NIL
HDFC BankInsufficient Funds:1st- ₹450 for regular citizens and ₹400 for senior citizens2nd- ₹500 for regular citizens and ₹450 for senior citizens3rd onwards- ₹550 for regular citizens and ₹500 for senior citizens
Funds Transfer Cheque Return:₹350 for regular citizens and ₹315 for senior citizens 
Technical Reason: ₹50 for regular citizens and ₹45 for senior citizens 
SBICheques returned unpaid by others (outstation/ local):Up to ₹1 lakh: ₹150 + GST Above ₹1 lakh: ₹250 + GST
Cheques drawn to SBI returned due to inadequate funds: For PB & TBU customers: ₹500 + GST (irrespective of the amount)For SME Customers: ₹500 + GST (irrespective of the amount) for the first 3 cheque returns and ₹1,000 + GST from 4th cheque return onwards
Cheque drawn to SBI was returned due to technical reasons: ₹150 + GST (No charges if the customer isn’t at fault)
ICICI BankOutward Return:₹200 (financial reasons)
Inward Return:₹500 (financial reasons)₹50 (non-financial reasons except verification of signatures)

Note that the above charges are subject to change at the bank’s discretion.  

Now that you know the meaning of cheque bounce and the reasons for it, take proactive steps to avoid it. This helps avoid any unnecessary financial liabilities and other severe consequences. In case your cheque bounces and you require funds to bridge your monetary gaps, get an Instant Personal Loan from Fibe.  

You can get a loan of up to ₹5 lakhs instantly at affordable interest rates with easy-to-meet eligibility criteria and minimal documentation. To get your hands on the funds with ease, download the Personal Loan App or log in to our website!  

FAQs on Cheque Bounce 

How can I avoid cheque bounce charges?  

Here’s how you can steer clear of these charges: 

  • Ensure that you have adequate funds in your bank account and keep an eye on the account balance regularly. 
  • Make sure that your cheque is not damaged or torn and all the details match as per the bank’s records. 
  • Request help from the bank if you’re unsure about your registered signature to prevent errors. 
  • Double-check that the numerical and word formats of the amount on the cheque match. 
  • Ensure that you’ve written the accurate date on the cheque and you have funds in your account on that date.  

When is the payee charged for a bounced cheque? 

The payee also needs to pay cheque bounce charges in case of: 

  • Insufficient funds 
  • Signature mismatch 
  • Other technical reasons 

Note that this may vary depending on the bank.  

Can I get bail in a cheque bounce case? 

Yes, you can get bail in a cheque bounce case.  

What if my cheque bounces due to insufficient balance?  

Here’s what happens in such cases: 

  • You may face legal proceedings if your cheque returns due to insufficient funds.  
  • The payee may allow you to re-issue a cheque within 3 months.  
  • In case of a cheque dishonour, you may face imprisonment.  
  • The bank may also apply a monetary penalty for the cheque bounce.  

Who pays cheque bounce charges?  

The person who issues the cheque is responsible for paying the penalty charges for a cheque bounce. In some cases, both the parties need to pay the charges. 

ATM Card Blocked : 5 Simple Ways to Block & Unblocked ATM Card/Debit Card

The option to block your ATM card is one of the ideal options to ensure better protection of your funds. You can rely on this option if: 

  • You notice any suspicious activity 
  • Your card is lost or stolen 
  • To prevent unauthorised transactions or ensure it’s not misused

When you realise your card is not at risk after you block it, you can easily unblock it. This gives you complete access to the funds and ensures the safety of your funds. This way, you can easily manage your card with the options offered by the bank. 

Read on to learn what to do when an ATM card is blocked, how to block and unblock it, and safety tips to avoid it.

How to Block an ATM Card?

Here are some of the online and offline ways of getting your ATM or debit card blocked:

Through Customer Care

One of the fastest ways to do this is by calling the customer care number. To initiate the process, you need to provide some details for verification. Once verified, they will block your card and send you confirmation through SMS or email.

At the Branch

You can also visit the nearest branch of your bank and talk to a representative about blocking your card. The representative will also ask for details to verify your identity and block your card.

Through Net Banking

Following are the steps to block your card online on the bank’s website. 

  • Step 1: Log in to using your credentials
  • Step 2: Navigate to the option to block the card
  • Step 3: Select the card you want to block
  • Step 4: Provide the reason for card blocking and other details
  • Step 5: Proceed and wait for confirmation

On the Mobile Banking App

To block the ATM card using this method, you need to register for mobile banking. Once registered, you can find the option on the dashboard for most mobile banking apps. Tap on it and follow the steps to place your request.

With SMS Banking

You can also get your ATM card blocked by sending an SMS to the number provided by the card issuer. All banks have a fixed SMS format to avail of this facility. Once you send the message, you will receive confirmation when the process is complete and your card is blocked.

Remember, the bank can also automatically block your card under certain situations, such as:

  • If you enter the wrong PIN more than three times
  • If there is a large amount of purchase that reduces the account balance to zero
  • If your card has expired
  • If the bank experiences a security breach

If this happens, you can talk to them and proceed to unblock your card to access the funds required.

Also Read: Transfer Money From an ATM Card to Another Account

How to Unblock an ATM Card?

Here are the various ways through which you can unblock your debit card:

Automatic Unblock

When a bank blocks the card for incorrectly entering the ATM PIN thrice, it gets automatically unblocked after 24 hours.

At the Bank Branch

If you’re having trouble logging into your net or mobile banking, visit your nearest bank. Here, you can place a request by providing your banking details. After processing your request and verifying the details, your card will be unblocked shortly.

Through Online Mode

You can also unblock your card by logging into your net banking account or through the bank’s mobile application. Once logged in, you can navigate to the unblock option and select the card.

Through SMS

Some banks also offer the card unblocking facility through SMS banking. Simply send an SMS in the specified format to the given number from your registered mobile number. Once your card gets unblocked, you will receive confirmation.

Also Read: What is ATM Card AMC

Safety Tips to Follow When Using the Debit Card

While blocking and unblocking your debit card is crucial, you can use these tips to avoid such situations and protect your finances:

  • Use a secure network when transacting with your debit card
  • Set up two-factor authentication
  • Avoid writing down or disclosing your ATM pin
  • Change your debit card PIN periodically
  • Opt for mobile notifications to get transaction alerts
  • Avoid handing over your card to the cashier when making a payment

Following these will safeguard your funds. Remember, be it a debit or a credit card, safety should be your top-most priority. The Fibe Axis Bank Credit Card is among the most secure cards as it’s a numberless card. This eliminates any vulnerabilities as your card details remain safe.  

This is an UPI-enabled card, allowing you to make seamless transactions. With this card, earn up to 3% cashback on all your transactions without any annual or joining fees. In addition, enjoy complimentary lounge access, discounts on dining, and much more. Download the Fibe App or visit our website to apply now!

FAQs on Blocking and Unblocking ATM Cards

How can I block my ATM card by SMS?

To block an ATM card, draft a text in the required format and send it to the designated number from your registered mobile number. You can find your bank’s SMS banking number and the format on the official website.

Can we unblock ATM cards online?

Yes, some banks allow you to unblock debit cards online via net banking or mobile banking apps.

How can I block my ATM card immediately?

Simply call the customer care helpline or log in to your net banking account to block your debit card immediately.

How do I withdraw money from a blocked account?

It is ideal to wait 24 hours to unblock it before withdrawing if the banks block your account. However, this timeline may vary depending on your bank.

Why was my ATM card blocked, and how can I find out the reason?

You can log into your net or mobile banking account to check your debit card status. You can also call customer care. 

Will I receive a notification if my ATM card is blocked?

Yes, once your card is blocked, you will get a confirmation text from your bank.

Issuer Identification Number: All You Need To Know

Wondering what an Issuer Identification Number or IIN is? Well, it’s an important component of payment cards, like credit and debit cards. The number helps identify the card issuer and your card’s processing network. Apart from this, you get to enjoy several other benefits, making this an important part of your payment card.

Here’s a brief snapshot of IIN, its importance and how it works.

What do you mean by an issuer Identification Number (IIN)?

An Issuer Identification Number is the first 6 to 8 digits you can find in a payment card. It is generally placed before your Primary Account Number (PAN) on the card. The IIN indicates the card network and the industry it’s associated with. 

With the help of this number, merchant banks manage transactions effectively. It also helps reduce the chances of error and financial fraud. The alternate name of IIN is Bank Identification Number or BIN.

Here is an example for better clarity regarding the IIN. Suppose your credit card number is 5526 7184 3412 3720. If the credit card issuer uses a 6-digit IIN, then the IIN for your card will be 552 671. If your credit card issuer uses an 8-digit IIN, then the IIN for your card will be 5526 7184.

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How does an issuer Identification Number (IIN) work?

To understand how an IIN works, you need to break it into two parts: 

  • Major Industry Identifier (MII)
  • BIN

The first digit of the IIN is the MII, which indicates the network with which the card is associated. Other digits make up the BIN, which helps identify the credit card issuer.

Here is a table of MII that you can use to understand which network your card is a part of: 

First Digit of IINAssociated Industry/Credit Card Company
1Airlines
2Mastercard
3Entertainment and travel
4Visa
5Mastercard
6Discover
7 to 9Healthcare, petroleum and other such industries

Why is the issuer Identification Number (IIN) important?

The IIN number of a payment card holds high significance because of several reasons, some of these include: 

Streamlines Processing of Payments

The IIN allows the identification of the processing network used for a transaction made by a card. This, in turn, ensures that your payments are processed efficiently and smoothly.

Prevents Fraudulent Activities

The number helps make your transactions more secure as it helps verify and authenticate the payment card’s status. This layer of security also helps prevent unauthorised transactions and other fraud.

Helps in Better Management of Payment Cards

The IIN number has also improved the management of payment cards and the transactions executed using these cards. It aids in quicker identification of the card issuer, allowing reduced errors and processing time for transactions. 

Boosts Confidence in Payments

The verification and authentication that IIN helps ensure that only authorised cardholders who have adequate funds can carry out transactions. With this optimum verification, merchants and customers consider these transactions reliable and secure. Thus, it helps boost the confidence of all the parties associated with the transactions.

Now that you know the IIN full form and what is an IIN number in a bank or otherwise issued card, you have a clearer understanding of how payment cards work. However, despite the security that these features add, the numbers on your credit card still make it vulnerable to fraud. Thankfully, you can now get a numberless card and ensure that your finances are secure.

The Fibe Axis Bank Credit Card is India’s first numberless credit card, enabling you to make secure transactions easily. That’s not all. With this credit card, you can get discounts of up to 3% on every transaction, 15% on dining with partner restaurants and much more! You can also link with UPI apps to make seamless payments. Download the Fibe App or log in to our website to apply.

FAQs on Issuer Identification Number

Why is an Issuer Identification Number important?

The IIN number helps know the card company and the industry a payment card is associated with. The number also helps streamline payments, prevent fraud, support identification and more.

What is the difference between IIN and BIN?

There is no difference between the Issuer Identification Number (IIN) and the Bank Identification Number (BIN). 

What is the Bank Identification Number or BIN?

A Bank Identification Number, or BIN, is the initial digits on a credit card or any other payment card that helps identify the issuing institution and industry.

6 Reasons Why Your Credit Card Application Declined & how to improve

If your credit card application is declined, it isn’t the end of the world. Nowadays, applying for a credit card is easier, thanks to fintech advancements that allow you to get quick approval from the comfort of your home. Despite the easy access, issuers have specific eligibility criteria that you must fulfil. 

All financial institutions issuing credit cards can reject your application for eligibility-related reasons. Knowing them well in advance can help avoid unnecessary rejections on your application. 

Read on to know some common reasons why issuers may deny your credit card application, what to do when your credit card application is declined and more. 

Reasons why your application may get rejected

Here are some of the most common reasons why issuers may reject your application. 

  • Poor Credit Score

Your credit score is a three-digit numerical summary of your creditworthiness. Lenders consider this a vital criterion before approving any form of credit. The score ranges between 300 and 900, with a score above 750 being optimal.

While some financial institutions may approve if you have a score of 700 or above, a value less than 650 may result in the rejection of credit card or loan approval. So, check and improve your credit score before applying for a credit card or loan to avoid rejection. 

  • No Credit History

Card issuers review your credit history to assess your ability to handle credit and your repayment strategies. This allows them to evaluate the risk of providing the credit card. Thus, being new to credit can pose a hurdle in getting a credit card. 

In such cases, some issuers allow you to apply for a secured credit card. This is a type of credit card for which you need to pledge collateral, such as a fixed deposit. Using this card, you can build a credible history before applying for a regular credit card. 

  • Insufficient Income

Credit card providers check your income proof to ensure that you have sufficient repayment capacity. Hence, issuers insist you provide a salary slip, income tax return or Form 16 document when applying for a credit card. If you meet the required income eligibility parameter, you have a higher chance of getting the credit card on favourable terms. 

However, in certain situations, despite having a decent income, your application may still get rejected due to the debt-to-income (DTI) ratio. A high debt-to-income ratio indicates that most of your salary goes into paying bills and dues, so you cannot afford another EMI. Thus, it’s essential that you maintain a DTI ratio of less than 30%. 

  • Unstable Employment

Most credit card issuers prefer applicants with stable job profiles and employment history. If you frequently change your jobs every 6 months, you may find it difficult to get approval for a credit card.

  • Error in Application Details

Any minor error in your application can lead to rejection, so you must fill out your application accurately. Re-check your application before submitting it and provide complete information. If you have any doubts, you must contact the issuer immediately. 

  • Multiple Applications 

When applying for a credit card, ensure you don’t apply simultaneously with different issuers. Each time you apply, the issuer runs an inquiry into your credit history that can cause a dip in your credit score. Hence, to avoid your credit card application being declined, apply with one issuer at a time. 

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What to do after your Credit Card application is declined? 

Now that you have a solution to the query, ‘Why my credit card application declined,’ here are a few tips to improve your chances of approval.

  • Ask the issuer the reason for your credit card application getting declined
  • Review your credit report and score regularly
  • Pay your credit card bills on time and reduce your debt-to-income ratio 
  • Re-check your application to spot errors and rectify them at the earliest

In conclusion, you must work on your creditworthiness before applying for a credit card. All credit card issuers set varying terms and conditions you need to match before getting approval. Hence, visiting their website and reading these terms carefully before applying is better. 

If you plan to get a new credit card, consider the Fibe Axis Bank Credit Card. As India’s first numberless credit card, it allows you maximum security against identity theft and fraud. With zero annual and joining fees, this UPI-enabled credit card offers up to 3% cashback on all your transactions, along with other perks such as complimentary lounge access and much more. Download the Fibe App or apply on our website to get started! 

FAQs on Credit Card Application Rejection 

What happens if I get rejected for a credit card?

If your credit card application is declined, it does not affect your credit score. So, you can reapply once you understand the exact reason for rejection.

Can we apply for a credit card after rejection?

Yes, you can re-apply with the same or different issuer, but it’s best to wait before applying for a card immediately after rejection. 

What is the percentage of credit card rejection?

Since your chances of approval or rejection depend on your eligibility and issuer’s terms, there is no fixed percentage for credit card rejections. Also, these criteria may vary from one issuer to another. 

Hence, maintaining a spotless credit history and an optimal score is one of the various strategies you can adopt to avoid credit card rejections.

How do I get approval for a credit card?

You must fulfil the following conditions if you want to get approval for a credit card: 

  • Meet the issuer’s eligibility criteria
  • Provide accurate and complete information on the form
  • Have a good credit score and history

Repo Rate & Reverse Repo: Meaning & Key Differences Explained

Reverse repo rate and repo rate set by the RBI are specific monetary policy tools. The policies that govern these rates help manage the country’s overall economy. Specific factors like inflation, currency rate changes and money flow influence these rates.  

Read the information below to define repo rate and reverse repo rates and learn how they impact the economic situation within the country.

Current Repo Rates

At present, the repo rate in India is 6.50%. This remains unchanged after the RBI’s announcement on August 8, 2024. This updated rate came after the last change in February 2023, when it was 6.25%.

Reserve Bank of India Repo Rate

The revised repo rates, according to the Reserve Bank of India, are:

Repo Rate Today6.50%
Reverse Repo Rate3.35%
Bank Rate6.75%
Marginal Standing Facility Rate6.75%

Disclaimer: These rates are current as of December 2024. Since rates are updated regularly, make sure to check the latest rates. 

What is the Repo Rate?

The abbreviation ‘repo’ stands for Repurchasing Option or Repurchasing Agreement. The Reserve Bank of India (RBI) fixes the repo rate for commercial banks to borrow funds against collateral. 

To deal with volatile market situations or to maintain liquidity, commercial banks borrow funds from the RBI, according to this rate. According to the announcement in December 2023, the repo rate has remained unchanged from the previous rate of 6.50%.

Impact of Repo Rate Change on Borrowers

A change in the repo rate is directly reflected over the cost of borrowing. If the repo rate increases, your cost of borrowing also increases. Similarly, the cost of borrowing will decrease with a declining repo rate. 

Why? When the repo rate increases, it becomes difficult or costs more for banks to get capital from RBI and so, banks increase the interest rates. Likewise, you get loans at affordable rates if the RBI lowers the repo rate.

Relationship Between Repo Rate and Inflation

This rate plays a crucial role in maintaining stability and keeping control over the economic flow of money. The RBI increases the repo rate to regulate cash flow and incline borrowing costs, specifically with the rise of inflation. 

When the overall money supply within the economy declines, the lending activities by banks also reduce. This reduction can lead to less overall consumer spending, investment and demand. Thus, it controls price stability and inflation.

What is the Reverse Repo Rate?

To control the overall market supply of money the reverse repo rate is another useful tool. As the name states, it is the rate at which the RBI borrows money from banks within the country. Placing funds with RBI is a safe option that most commercial banks have. 

Commercial banks can get more incentives for depositing funds with the Central Bank when the reverse repo rate by the RBI increases. Overall, this can lead to a decrease in the availability of loans as well as the money supply within the economy. 

As per the latest announcements, the reverse repo rate in India is stable at 3.35%. It is important to understand that reverse repo rates are always lower than the repo rates.

Difference Between Reverse Repo Rate and Repo Rate

Check the following table to know the differences between repo and reverse repo rates in India:

ParameterRepo RateReverse Repo Rate
Lender and BorrowerThe RBI offers money to commercial banksThe RBI borrows money from commercial banks 
Operational MechanismBanks offer their securities as collateral to gain funds and buy them backThe RBI pledges its securities to deposit funds and get loans
ObjectiveTo promote price stability and money deficiencyTo control the availability of money 
Impact of Rate Hike A hike in repo rate discourages banks from borrowing; as the repo rate rises, the interest rate increases tooBanks prefer to deposit surplus funds with the RBI to earn interest, leading to a fall in the money supply
Impact of Decrease in RateLower repo rates encourage lending with lower interest ratesBanks reduce deposits with the RBI and lend more to the public 

As mentioned above, an upward repo rate can increase your loan’s interest. An increase in the reverse repo rate can also impact its availability. Such changes can impact your ability to receive desired loan amounts. To equip yourself to deal with financial needs during such times, it is best to create an emergency fund. You can also invest in liquid options, be it mutual funds or fixed deposits. 

FAQs on Repo and Reverse Repo Rate

What is the current repo and interest rate?

As per the recent changes in December 2023, the repo rate in India is 6.50%. An increase in repo rate allows for an increase in interest rates on loans.

Who sets the reverse repo rate?

The Reserve Bank of India sets the reverse repo rate. It is a monetary policy instrument to control the money supply in the economy by the RBI.  

What is a repo rate with an example?

The current repo rate is 6.50%. So, if a commercial bank borrows ₹1 lakh from the RBI, it will have to pay an interest of ₹6,500. 

Is the repo rate good or bad?

While the repo rate may affect borrowing costs, it is an essential tool to control the money supply and promote price stability in the economy. 

Is the reverse repo rate fixed?

The reverse repo rate is currently unchanged by the RBI, stable at 3.35%, whereas the repo rate is unchanged at 6.50%.

Check Your CIBIL Score with PAN Card

Wondering if you can check CIBIL score with a PAN card? The answer is yes. As you may be aware, your CIBIL score plays an essential role in your credit approval process. Lenders consider it a reflection of your repayment behaviour. If your CIBIL score is on the lower end, lenders may hesitate to approve your applications.

By checking your CIBIL score with a PAN card, you can assess well in advance if you meet the credit score criteria set by a lender. Read on to learn how to check CIBIL score with a PAN card.

Steps to Check Your CIBIL Score Using a PAN Card

Keeping your PAN card handy, you can check your score on the official website of TransUnion CIBIL. Here are the steps you need to follow:

  • Step 1: Click on the ‘Get Your Free CIBIL Score’ button 
  • Step 3: Enter necessary details, including your name, e-mail address and date of birth
  • Step 3: Select PAN as the ID type for checking the CIBIL score and provide your PAN number
  • Step 4: Click on ‘Accept and Continue’

Follow the next steps to complete the OPT verification and get your free score and report. 

You can also use your PAN number to check your credit score for free on Fibe. Follow these steps:

  • Step 1: On the Fibe website or app, navigate to ‘Check Credit Score’ section and click to proceed 
  • Step 2: Enter your mobile number and add the OTP to verify it 
  • Step 3: Add your email ID and verify the OTP you receive 
  • Step 4: Fill in your personal details and add your PAN number 
  • Step 5: Complete your KYC and get your credit score and report 

Using a PAN Card for Checking Your CIBIL Score

A PAN card makes the process of checking your CIBIL score easier and more inclusive since:

  • It aids in the verification and authentication process carried out by financial institutions and credit information companies
  • It helps banks and NBFCs keep track of personal and financial information 

Important Factors that Influence Your CIBIL Score

Want to know what makes your CIBIL score increase or decrease? This list has your answer:

  • Credit Mix

You must have a healthy credit mix, including secured and unsecured credit. A credit card comes under the category of unsecured credit and a home loan is considered a secured loan.

Having experience with various types of credit demonstrates that you are adept at handling it all. This improves the chances of approval for future credit and helps maintain a healthy score.

  • Repayment History

Missing your loan EMIs and credit card bills impacts your CIBIL score negatively since it shows negligent repayment behaviour. To keep your CIBIL score high, prioritise timely repayment of your loans and credit cards. You can set reminders or opt for auto-debit facilities to help avoid missing any payments.

  • Credit Report Inquiries

When you apply for a credit card or a loan, the financial institution carries out a hard enquiry to assess your eligibility and creditworthiness. A hard inquiry can reduce your score for a short period. Try not to apply for multiple forms of credit simultaneously, as that can hurt your score.

  • Credit Utilisation Ratio

To maintain an optimal CIBIL score, keep your credit utilisation ratio low. It refers to the amount of credit that you use in comparison to the sanctioned credit limit. A high ratio reflects a high reliance on credit that can impact your score negatively. Ideally, you must try to keep your credit utilisation below 30%.

  • Credit History Duration

The age of your credit accounts plays a significant role in your credit score. A longer credit history indicates that you have had time to prove your ability to manage credit responsibly. 

Lenders often view a well-established credit history as a sign of stability and financial reliability, making it easier to qualify for future credit.

  • Status of Unresolved Loans

Any old loans marked as ‘settled’ or remaining open, especially if they were not fully paid off, can negatively affect your CIBIL score. 

If you have any unresolved loans in your credit history, it’s advisable to settle the outstanding balance and request the lender to officially close the account. This will help prevent any ongoing negative impact on your credit score.

  • Errors or Discrepancies in Credit Reports

Errors in your credit report, whether from credit bureaus or lenders, can sometimes lead to an inaccurate reflection of your credit status, ultimately damaging your credit score. 

To avoid such issues, it’s essential to regularly monitor your credit report for discrepancies. If you spot any mistakes, you must dispute them with the relevant parties to ensure that they are corrected promptly.

Now that you know how to check your CIBIL score with a PAN card, take the necessary steps to maintain an ideal score. However, if you are new to credit or have a low score, there’s no need to stress as you can apply for a loan at Fibe. We don’t rely on credit scores and have an alternate scoring system, helping you get immediate access to funds. 

Get a Fibe Personal Loan to bridge your monetary gaps. You can get up to ₹5 lakhs instantly at affordable rates. Simply download the Personal Loan App or log in to our website and apply today!

FAQs on How to Check Your CIBIL Score with a PAN Card

Is it possible to check my CIBIL score using a PAN card?

Yes, you can easily check your CIBIL score with a PAN card. For this, you need to visit the CIBIL website or check your score for free on the Fibe App or website. 

How can I get loan details using a PAN card?

You can find your loan details and other financial information, along with your credit score, on your credit report. You can access your CIBIL report and score with a PAN card.

Will my CIBIL score be affected when I apply for a new PAN card?

No, applying for a new PAN card does not have an impact on your CIBIL score.