Unlocking Hassle-Free Highway Travel with FASTag Credit Cards
Did you know that the National Highways Authority of India (NHAI) has made FASTag mandatory for all vehicles? In 2023, over 97% of FASTag transactions were processed digitally. Yet, many still grapple with managing toll payments efficiently.
What most people miss: integrating this daily necessity with their existing financial tools. This guide explores how credit cards designed for FASTag can simplify your journeys and offer rewards.
Understanding FASTag Credit Cards
A FASTag is an electronic tag on your vehicle's windshield. It allows automatic deduction of toll charges as you pass through toll plazas. Now, imagine linking this directly to your credit card. This means toll payments are automatically debited from your credit card, potentially earning you rewards and simplifying your monthly finances.
How FASTag Credit Cards Work
Direct Linkage: Your chosen credit card is linked to your FASTag account.
Automatic Deduction: Toll charges are debited from your credit card balance.
Consolidated Billing: All your FASTag expenses appear on your monthly credit card statement.
Reward Potential: Earn reward points, cashback, or discounts on toll payments.
The reality is, this system streamlines not just payments but also record-keeping. So what does that mean for your finances? It offers a consolidated view of your travel expenses.
Benefits of Using a Credit Card for Tolls
Opting for a credit card with FASTag integration offers several advantages beyond mere convenience.
Financial Advantages
Rewards and Cashback: Many lenders offer accelerated reward points or cashback specifically on FASTag recharges or toll spends. For instance, some cards provide up to 5% cashback on toll payments.
Credit Score Improvement: Timely repayments of your credit card bills, which now include toll charges, positively impact your CIBIL score. How does this affect your CIBIL score? Consistent, on-time payments build a strong credit history.
Interest-Free Period: Benefit from the typical cost of borrowing-free credit period on your purchases, including toll payments, if you clear your statement balance by the due date.
Simplified Management: Instead of managing a separate FASTag wallet, all your expenses are consolidated into one credit card statement.
Convenience and Time Savings
Skip Queues: Electronic toll collection ensures faster movement through plazas, saving valuable time.
Reduced Hassle: No need for frequent wallet top-ups or managing multiple payment methods.
Choosing the Right FASTag Credit Card
Selecting the optimal credit card requires careful consideration of your spending habits and the lender's offerings.
Key Features to Compare
When comparing options, focus on these critical aspects:
Feature | Option A (e.g., Fuel-Focused Card) | Option B (e.g., Travel Card) |
|---|---|---|
Annual Fee | ₹499 - ₹1,499 | ₹0 - ₹999 |
Toll Spend Rewards | Up to 2% cashback | Up to 5% reward points |
Other Benefits | Fuel surcharge waiver | Airport lounge access |
Welcome Benefits | ₹500 voucher | ₹1,000 cashback |
rate Rate (APR) | 2.5% - 3.5% per month | 2.0% - 3.0% per month |
In real-world terms, a card offering 5% reward points on toll spends could save you ₹500 annually on ₹10,000 worth of tolls, assuming a redemption value of ₹0.20 per point.
Steps to Apply
Check Eligibility: Ensure you meet the lender's criteria (age, income, credit score). A CIBIL score of 700+ is generally preferred.
Gather Documents: Have your ID proof, address proof, and income proof ready.
Compare Offers: Use platforms like Six Finance to compare different credit cards.
Apply Online: Fill out the application form accurately.
Link FASTag: Once approved, follow the bank's instructions to link your credit card to your FASTag.
Worth knowing: Some banks may offer pre-approved FASTag credit card options based on your existing relationship with them.
Expert Tips for Responsible Usage
Maximise benefits while managing risks effectively.
Monitor Spends: Regularly check your credit card statement for accuracy and track your toll expenses.
Repay on Time: Always pay your full statement balance before the due date to avoid cost of borrowing charges. The typical rate rate on outstanding credit card balances can range from 15% to 40% per annum.
Understand Fees: Be aware of annual fees, late payment charges (often ₹300-₹1200), and other potential costs.
Redeem Rewards Wisely: know the redemption value and expiry of your reward points.
Avoid Overspending: Use the credit limit responsibly and do not let toll payments lead to unnecessary borrowing.
So what does that mean for your finances? It means maintaining financial discipline is key, even with convenient payment methods.
Reader Checklist: Are You Ready for a FASTag Credit Card?
Do you frequently travel on national highways?
Are you looking for a way to earn rewards on toll payments?
Can you commit to repaying your credit card bill in full and on time each month?
Have you reviewed your current CIBIL score?
Are you aware of the potential finance charge rates and fees associated with credit cards?
Key Takeaways
FASTag is mandatory for most vehicles on Indian highways.
Credit cards linked to FASTag offer convenience and potential rewards.
Key benefits include cashback, consolidated billing, and credit score improvement.
Eligibility typically requires a good CIBIL score (700+) and stable income.
Responsible usage involves timely full repayments and monitoring of spends.
Disclaimer: This content is for educational purposes only and does not constitute personalized financial advice. Always refer to the lender's terms and conditions and consult a financial advisor for decisions tailored to your situation. Regulatory guidelines from bodies like the Reserve financial institution of India (RBI) should also be considered.
Compare and apply for the best credit card rates on Six Finance.
Frequently Asked Questions
What is the minimum CIBIL score required for a FASTag credit card?
While specific requirements vary by lender, a CIBIL score of 700 or above is generally considered good. Applicants with scores between 650-699 may still be considered, but approval is less certain.
What is the process to link my existing FASTag to a new credit card?
You will typically need to deactivate your current FASTag wallet, then add your new credit card as a payment method through the respective lender's mobile app or website for your FASTag account.
What are the risks of using a credit card for FASTag payments?
The primary risk is accumulating high-cost of borrowing debt if you do not pay your statement balance in full by the due date. Late payment fees can also be substantial.
Are there alternatives to using a credit card for FASTag?
Yes, you can link your FASTag to a debit card, UPI, or maintain a prepaid wallet balance. These methods deduct funds directly, avoiding credit-related cost of borrowing charges.
What happens if my credit card payment for FASTag fails?
If your credit card payment fails, your FASTag may be deactivated, leading to potential penalties or inability to use highway toll plazas. Your credit card issuer may also levy late payment fees.