How to Transfer Money from Credit Card to Bank Account | Balance Transfer from Credit Card
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31 MAY, 2022

Credit cards come in handy in a variety of ways. They allow you easy access to money when you need it most. And can even earn you extra advantages and benefits - read - rewards and cashback! So, be it any financial emergency or realizing your dreams, credit cards can do so much for you. And that’s why, in this age and time, having a credit card is not just a privilege, but a necessity. However, you need to be careful while using credit cards or you can end up with massive debt. The best way to avoid such a situation is using a credit card to bank transfer facility.

Credit Card to Bank Transfer

Now if you are wondering, can I transfer money from a credit card to a bank account, the answer is: yes.

As the name implies, it is a facility to transfer the balance amount from one credit card to another. A money transfer credit card allows you to make such a transfer. You can choose to opt for credit card balance transfer if your rate of interest on one credit card is high. In such a scenario, transferring the money to another credit card seems like a fair deal. It also buys you some time to arrange for the required amount to clear off your dues on the credit card.

Balance transfer of credit cards has its own benefits. Here are a few:


1. Manage Your Money:
Sending money from credit card to bank account comes with a lot of perks. An important financial management tool, credit card balance transfer allows you to avoid high interest rates and helps buy some time for the debt payoff. This is especially helpful, when you have multiple credit cards.

Different credit cards, means different repayment dates and different debt amounts. With balance transfer from credit card, you can consolidate all these debts by transferring the pending payments to a single credit card of your choice. And then repay these at a more convenient time. This not only saves you interest rates but also late charges.

2. Avail of better credit terms:
Avail of better credit terms:An important reason to consider a money transfer credit card is unfavourable terms and conditions on one or more of your existing credit cards. High service and default fees, short payback and grace periods could be some factors why people could opt to close the existing accounts and transfer money from a credit card. You can balance transfer from a credit card to another one that comes with better rewards and offers better savings options.

3. Earn Lucrative Rewards:
Most banks offer you several additional benefits when you opt for a credit card to bank transfer. Air ticket discounts, reward points, cashbacks could be raining offers for you!

Apart from that, credit card transfer to a bank account comes with some extra perks like instant transfer, less documentation and even paperless money remittance. You can even benefit from your bank’s no interest period, if it offers one.

4. Payback at a Lower Interest Rate:
But one factor that makes the balance transfer from credit card an extremely popular choice is the convenience to pay at a lower interest rate. So, choosing a new credit card that offers a lower interest rate is your best bet to decrease the debt, making the repayment cheaper and easier.

But with all these wonderful benefits, you must keep in mind an important factor: your credit score and how balance transfer from credit impacts it.Whenever you opt to transfer money from a credit card, it is imperative to have a good credit score. Although the interest rate may be lower, you have to pay the dues sooner or later. And if you fail to pay your EMIs or any other bank loans within the stipulated time or your credit history shows any inconsistency in your payment records, then it will impact your credit score negatively. A lower credit score could make you ineligible for balance transfer from credit card.

How to Transfer Money from Credit Card to Bank Account Online?

You can transfer money from your credit card to your Kotak Mahindra Credit Card using netbanking or mobile banking in simple steps.

Follow these instructions if you are using netbanking:

1. Visit www.kotak.com
2. Tap “Netbanking” option
3. In the User ID field, key in your CRN
4. After this, you can either key in your Password, or choose to generate an online password by clicking on “Get Netbanking Password Online”
5. Next, tap on “Credit Card”Choose “Balance Transfer”

In case you wish to use your mobile banking facility, you can follow these steps:

1. Login to your Kotak mobile banking app
2. Tap on “Credit Card”Choose “Balance Transfer”

A direct credit card to bank account transfer does not work. And although this is not a common practice, using intermediaries to transfer money from a credit card can be possible. You can use your BHIM Kotak Pay account to transfer money from credit card to your UPI wallet. Once that is done, you can transfer the amount to your Kotak Mahindra Bank Account. It is advisable to be careful while making such transactions.

How to Transfer Money from Credit Card to Bank Account Offline?

At present, offline balance transfer from credit card to bank account is not available. You could visit your bank’s branch or call them for more information.

Key Points to Consider Before Transferring Money from Credit Card to Bank Account:

Credit card to bank account transfer comes with a lot of advantages. However, there are a few factors that you must bear in mind.

Your debt remains the same
You may avail of the balance transfer of credit card at a lower interest rate. But even then the total debt amount will not change and must be repaid. Also, it must be done in the given time to avoid any financial complications. It cannot be emphasised enough that debt repayment must be given due importance in this process.

Transaction fee is applicable
Second thing to keep in mind is that balance transfer from credit card comes at a charge. You have to pay a certain amount as a transaction fee for the balance transfer of the credit card. This transaction fee varies from one bank to another. Further, it also depends on the amount to be transferred.

So while credit card balance transfer is an advantageous way to keep your finances well-managed, it is crucial to not get trapped in a debt cycle instead of staying on top of it.

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Frequently Asked Questions

Should I apply for a balance transfer credit card?

You may proceed with the balance transfer option if you see possible savings out of it. Paying high-interest debt doesn’t make sense when you can qualify for a new card with a 0% APR. This way, you can consolidate your debt and pay them off without any hassle. Many balance transfer credit cards offer a 0% or low interest rate on balance transfers for an introductory period, which can allow you to save money on interest charges while you pay down your debt.

How many times can I transfer my credit card balance?

No limitations are there on credit card balance transfer, but ensure the existing debt doesn’t exceed your credit limit. So do balance transfer wisely taking care of all factors, such as new credit card limit, used and unused balance, and existing debt. There may also be a maximum amount for balance transfers, regardless of your available credit limit. So, it's important to carefully review the terms and conditions to understand the balance transfer limit and any associated fees.

How can we choose the best balance transfer credit card?

A credit card with an introductory 0% APR is considered best for balance transfer as it helps you avoid paying additional charges on your outstanding balance. 0% APR is valid for a limited time only, for instance up to 90 days. The best balance transfer credit card for you will depend on your specific financial situation and goals. Compare different credit cards to find the one that best meets your needs.

Will credit card balance transfer affect my credit score?

A balance transfer helps you transfer your unpaid credit card bills to a new card. And when you transfer a balance, your credit score will likely improve as you will pay them off without interest. The 0% APR of your new card will help you reduce the interest burden of your existing credit card debt. However, whether it has a positive or negative effect depends on how you manage the transfer and your existing debt.

Is it hard to get a balance transfer credit card?

Balance transfer credit cards are easy to get if you have a good credit score and an existing relationship with the card issuer. All these help you qualify for a new credit card with which you can manage your unpaid credit card bills. While it may not be necessarily hard to get a balance transfer credit card, it's important to consider your individual financial situation and do your research before applying.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.