Credit Card’s Full Limit Can Be Used In Single Transaction, Says Consumer Court

The Delhi Consumer Court has made a significant ruling concerning credit card usage. In East Delhi, the court has directed ICICI Bank to compensate a consumer for service deficiencies. Specifically, the bank refused a transaction, citing the consumer’s inability to utilise the full credit card limit at once. Dissatisfied, the consumer filed a petition, leading to the court’s decision. As a result, the consumer court has ordered the bank to pay Rs 12,500 in compensation for causing distress to the consumer. Additionally, the court provided noteworthy remarks regarding the appropriate utilisation of credit card limits.

A resident of East Delhi brought forward a grievance stating that despite having fully utilised their credit card limit, the bank refused their transaction, asserting that the entire credit limit could not be expended in a single instance. Upon reviewing the consumer’s complaint, the District Consumer Disputes Redressal Commission concluded that the bank’s stance was unjustified. The commission emphasised that it is permissible for consumers to utilise their entire credit card limit in one transaction, rebuking the bank’s restriction as improper.

In its decisive verdict, the court emphasised the fundamental right of a credit card holder to utilise the card during emergencies once it has been issued. The two-member bench underscored that the bank’s practice of charging an annual fee for the credit card, alongside billing charges and interest for transactions, was in line with industry norms. Importantly, the consumer court also observed that the bank had failed to disclose to the complainant at the outset any limitations regarding the size of transactions permissible with the newly issued credit card. This lack of upfront communication was deemed unfair and constituted a significant factor in the court’s decision.

Consumer Court is a special purpose court in India. It primarily deals with consumer-related disputes, conflicts and grievances. The court holds hearings to adjudicate these disputes.