Hi,
My friend has taken a PayLess card from DCB Bank against FD. He paid less than the monthly bill amount for a month, and the next month, he had been levied interest charges on the whole mothly bill amount, instead of on the non-paid portion of it. When he approached the bank, they point him to an item in their terms, which reads as follows:
b. Finance charges (Interest charges):
* Interest will be charged from the date of transaction, until the date of settlement, if you (the words "you" and "your" refers to the DCB Payless Card member or Account Holder) do not pay back the previous bill in full.
* If a part payment is made, there would be no interest free period and interest charges would be applicable (including on fresh purchases, if any) via an average daily balance method.
I learnt that his bank is further justifying their action saying that their card is named a payless card and not a credit card. I somehow felt that this is against public policy and defies logic of any sane person. I am here to get some legal understanding of whether bank can include whatever it wants in its terms and since my friend signed them, is he obliged to abide by them, even if they are against the public policy? Expert legal advice of members here is highly appreciated.
