1. Growing Demand for Premium Cards
There is increasing interest among high-net-worth and affluent consumers for premium and super-premium cards. As incomes and discretionary spending on travel, dining, and lifestyle increase, many consumers are now exploring cards offering exclusive perks.
2. Fees for Top-End Cards
Ultra-premium cards often come with high joining and annual fees.
For example:
- Annual fee = ₹3,00,000
- GST = 18% of ₹3,00,000
Total annual fee including GST = 3,00,000 + 54,000 = ₹3,54,000
- Annual fee = ₹12,499
- GST = 18% of ₹12,499
Total annual fee including GST = 12,499 + 2,250 = ₹14,749
Certain cards offer fee waivers or reductions if annual spending thresholds are met, which varies depending on the card and issuer.
3. Perk adjustments,” “Category fees,” “Luxury perks”
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Perk adjustments: Banks may periodically adjust reward rates, lounge access privileges, or milestone thresholds.
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Category fees: Some issuers impose fees on specific types of transactions beyond set limits. For example, certain banks have added charges for fuel transactions beyond a cumulative monthly spend.
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Luxury perks: To justify higher fees, issuers often provide lifestyle and travel benefits such as global lounge access, hotel/dining program memberships, concierge services, wellness offerings, and premium memberships. American Express Platinum Card has introduced additional elite-tier memberships and lifestyle benefits as an example.
4. Typical Card Tiers & Trade-Offs
5. Factors to Consider
When evaluating premium cards, consider:
- Usage of perks: Assess whether benefits such as lounge access, hotel/dining programs, and travel vouchers align with your lifestyle.
- Spending thresholds: Check if fee waivers are achievable without overstretching.
- Hidden costs: Include foreign-transaction markups, joining/renewal fees, category-based fees, and guest access limitations.
- Benefit changes: Review terms annually, as banks may revise perks or fees.
- Card consolidation: Holding multiple premium cards with overlapping benefits may not be cost-effective.
6. Summary Guidance
- Compare total fees vs estimated benefits to evaluate potential value.
- Track annual spend thresholds for fee waivers.
- Monitor updates in benefits or fees regularly.
- Assess whether card perks match personal travel and lifestyle patterns.
7. Can You Really Earn From Premium Credit Cards? A Reality Check
Here’s how:
- Reward Points / Cashback: Most premium cards give points on spends—these can be redeemed for vouchers, flights, or merchandise. Some also offer cashback.
- Milestone Bonuses: Cards often reward extra points or benefits if you spend a certain amount in a year.
- Travel & Lifestyle Perks: Free lounge access, hotel discounts, or dining offers can save money, which is an indirect “earning.”
Key: To actually benefit, you need to spend strategically. Otherwise, the high annual/joining fees can overweigh rewards.
Disclaimer: This information is for educational purposes only and does not constitute financial or investment advice. Individual circumstances and usage patterns may affect the value derived from premium cards. Brand mentions are factual and for illustrative purposes only.
Source: The Economic Times, CNBCTV18, ZeeBiz, Moneyview, The Times of India