Credit Card Rules – If you’re someone who uses a credit card, especially from Kotak Mahindra Bank, it’s time to pay attention. Starting June 1, 2025, several important changes will come into effect that could directly impact how you earn rewards and what fees you might have to pay. So, if you own a Kotak credit card, you should definitely know what’s changing and how it might affect your spending and rewards.
Changes in Rewards Limits
Kotak Mahindra Bank has announced new rules that limit how much reward points or cashback you can earn on certain types of spending. This means if you’re using your credit card to pay for things like utility bills, education fees, wallet recharges, fuel, rent, government-related payments, insurance, or even online gaming, there will be caps beyond which you won’t earn any rewards.
For example, users of the Kotak Privy League Signature Card won’t earn any rewards if their utility bill payments go above Rs 75,000 or education expenses exceed Rs 1 lakh in a billing cycle. Similarly, wallet loading beyond Rs 10,000, government payments over Rs 75,000, insurance payments above Rs 1 lakh, and online gaming expenses exceeding Rs 15,000 won’t earn you any cashback or rewards either. In fact, for fuel and rent payments, no rewards will be given at all on this card.
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Then there are cards such as Delight, Fortune, and 6E Rewards variants, where these categories won’t earn any rewards whatsoever. The bank is also planning to exclude these categories from milestone benefits, which means even if you reach a spending milestone, these types of expenses won’t count towards extra rewards.
Reward Point Redemption Value Reduced
Not only are the earning limits being changed, but the value of the reward points you collect is also going down for some cards. For example, the redemption value for Kotak Royal, League, and Urban cards is dropping from 10 paise to 7 paise per point. If you have the Kotak 811 Credit Card, the value per point will decrease more sharply, from 25 paise to 10 paise. Even premium cards like Kotak Infinite and NRI Royal Signature will see their point value fall from Rs 1 to 70 paise. This means that when you redeem your points for cashback, gift cards, or other rewards, you’ll get less value than before.
New Transaction Fees on Some Categories
Along with the reward changes, Kotak Mahindra Bank will also introduce transaction fees for certain types of spending. A 1% fee will be charged on transactions in specific categories such as rent and education, regardless of the amount you spend. For other categories like utility bills, wallet loading, online gaming, and fuel, the fee will kick in only after you cross the spending limit set for each card.
For example, if you hold the Kotak Privy League Signature Card, you will have to pay a 1% transaction fee on utility payments exceeding Rs 75,000 and fuel expenses over Rs 50,000 within a statement cycle. For cards like Kotak 811, this fee will apply if you spend above Rs 35,000 on utilities or Rs 25,000 on fuel. So if you’re someone who spends heavily on these categories, this change could mean a noticeable increase in your monthly credit card bills.
What Should Cardholders Do?
With these changes coming into force from June 1, 2025, it’s a good idea to review your spending habits and see how they fit with the new rules. If you often pay large amounts toward utilities, education, fuel, rent, or online gaming with your Kotak credit card, you might want to rethink your payment methods or budget accordingly. Since rewards and cashback on these categories will be capped or eliminated, the value you get from your credit card might reduce.
This update from Kotak Mahindra Bank reflects a broader trend among banks tightening reward programs and charging fees on certain transactions to manage costs and encourage responsible spending. While rewards and cashback are always great, it’s important to understand the fine print and new limits so that your credit card continues to work for you, not against you.
If you hold a Kotak credit card, be sure to check the detailed terms and conditions released by the bank. Plan your spends smartly to maximize your benefits and avoid any unnecessary fees. Staying informed and adapting your spending habits will help you get the best value out of your card even after these changes come into effect.
Disclaimer
The information provided in this article is based on announcements by Kotak Mahindra Bank as of May 2025 and is meant for general informational purposes only. Credit card terms and conditions are subject to change, and it is recommended to consult the bank’s official communications or customer service for the most accurate and updated details. This article does not constitute financial advice.
