New Credit Card Reward System: As per information received from the other websites, Kotak, HDFC, and Axis—these three banks—are going to make major changes to their credit card reward point systems. And this change will come into effect from 1st June 2025, giving a significant shock to credit card users.
Kotak Mahindra, Axis, and HDFC Bank have made such changes in their credit card rules that reward points, airport lounge access, and fuel surcharge waiver benefits could all get ruined. If you use your credit card for bill payments, fuel, rent, or wallet loading, then this news is important for you. Reward points will either not be awarded or will be limited on expenses like electricity-water bills, school fees, fuel, rent, insurance, and online gaming.
Kotak Mahindra Bank: Rewards System Upside Down!
Kotak Mahindra Bank has completely revamped the reward system of all its credit cards. If you have the Kotak Privy League Signature Card, then forget about getting any reward points on rent or fuel payments. Even on utility bills (like electricity, water, and gas), rewards will only be given for expenses up to ₹75,000. Beyond that? Zero! And yes, if your utility bill expenses exceed ₹75,000 or fuel expenses exceed ₹50,000, then you’ll also have to pay an extra 1% transaction charge. That means—a big expense and a big setback!
- Increased Interest Rate: Now, the monthly interest rate on Kotak cards will be 3.75% (annual 45%), up from the previous 3.50% (42%).
- International Transactions: Shopping or making online purchases abroad? A dynamic currency conversion charge between 2% to 5% will be applied.
- Auto Debit Failure: If your auto debit instruction fails, higher penalty charges will be applied than before.
- Minimum Amount Due: Now you’ll have to pay minimum 1% of the outstanding amount, which is a bit stricter than earlier.
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Axis Bank: Rewards Now Based on Categories
Axis Bank is bringing a new reward system from 20th June 2025. Earlier, reward points used to depend on the Merchant Code (MCC), but now they’ll be based on the spending category. This will make it easier for you to know where you’ll earn rewards. But here’s the twist—no rewards will be given on utility, telecom, rent, fuel, wallet top-up, insurance, education, and government payments! Also, rent and wallet top-ups won’t count for annual fee waivers anymore.
- Milestone Benefits: Rent, insurance, wallets, and cash withdrawals will no longer be part of milestone benefits.
- Swiggy Offers: Good news for foodies—new offers like discounts and cashback have been added on Swiggy.
- Axis’s new system may be good for some customers, but if you use your card for rent or utilities, you’ll surely feel the loss of rewards.
HDFC Bank: Twist in Lounge Access
HDFC Bank has made a major change in the airport lounge access rules for the Tata Neu Infinity Credit Card, effective from 10th June 2025. Earlier, you just had to show the card to enter the lounge—simple. Now? You’ll have to spend ₹50,000 every quarter, after which you’ll get a voucher via SMS/email. This voucher must be claimed within 120 days and used within 180 days. You’ll now get only 8 domestic lounge visits per year, while international access remains unchanged. For RuPay cardholders, an extra $3.25 (about ₹270) will be charged per lounge visit!
- Tata Neu Infinity Benefits: 5% NeuCoins on Tata brands and Tata Neu platform, 1.5% on other spends. New users will get 1,499 NeuCoins on the first transaction. Annual fee waiver on spending ₹3 lakh.
- Fuel Surcharge: 1% waiver on fuel transactions between ₹400–₹5,000.
- HDFC has made lounge access harder, but the other benefits of Tata Neu cards still make them valuable.
What Else Do You Need to Know: New Credit Card Reward System
Q. Why are these changes happening?
A: Banks want to increase their profits. The cost of rewards and free benefits is rising, so banks are tightening rules to cover that. Also, strict RBI guidelines are forcing banks to improve risk management.
Q: Is using credit cards no longer beneficial?
A: It is definitely beneficial, but you need to use them smartly. Choose cards that match your spending pattern. For example, if you travel frequently, then SBI Elite or HDFC Diners Club Black offer lounge access and travel benefits. For fuel, IndianOil HDFC or Axis cards are still good.
Q: What should you do now?
- Review: Check your credit card’s reward structure and fees. If rewards are reduced, look for another card.
- Use Multiple Cards: Keep separate cards for different categories (travel, fuel, shopping). Example – Axis for Swiggy, HDFC for fuel.
- Plan Your Spending: Meet minimum spend limits for lounge access or annual fee waivers.
- Avoid Interest: Always pay the full bill. Otherwise, the 45% interest rate will hurt your budget.
Q: Will other banks also make changes?
A: SBI, ICICI, and YES Bank already made some changes in 2024, like reward caps and fee hikes. In 2025, more banks may follow suit. With RBI’s new guidelines and market pressure, this trend is likely to grow.
Conclusion
Credit cards can still make your expenses easy and rewarding—but you need to be smart. Understand your spending pattern, check the new rules, and choose the right card. If you want free lounge access, look into cards like HDFC Regalia Gold or Axis Magnus. For fuel and bill payments, try IndianOil HDFC or ICICI HPCL Super Saver.
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