January 21, 2026 · 5 mins read
Santosh Kumar
When a payment is made through UPI with a credit card, missing the payment would incur the same penalties as if a payment was missed with any other credit card. All operations involving payment through UPI are done using the UPI payment gateway; therefore, they are treated in exactly the same way as all credit card payments and subject to the same rules for billing. After the billing period ends, all amounts owed must be paid by the due date; however, if payments are not received by that date, penalties associated with late payments will begin.
The first penalty is the late payment fee. Almost all banks in India impose late payment penalties that are determined by multiplying the outstanding amount by a specific percentage. Depending on the size of the outstanding balance, these penalties may be substantial. In addition to charging late fees, the bank will charge a daily interest rate to the outstanding balance. This daily interest accumulates over time and is added to the total of all amounts due; therefore, continued non-payment may cause the total amount to grow rapidly. UPI Payments made with a credit card are settled at a later date, as opposed to UPI bank account payments that are charged to the user and immediately deducted from the user's bank account. Therefore, it is important that payments for UPI credit cards are made on time to avoid incurring the penalties listed above.
Your credit score will be affected negatively if you fail to make a payment on time. Your credit card company will report your payment habits (whether you make timely payments or not) to the credit bureaus, and if you have missed a payment or have made a late payment, this will cause your score to decrease. In addition, if you miss a payment only once, it will remain on your credit file for a long period of time. This could make it much more difficult (or expensive) to qualify for other loans or credit cards in the future. For many consumers, especially those who are new to credit, the effects of a missed payment are worse than they expected.
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When you miss a payment, you also lose the ability to take advantage of the interest-free benefit that typically comes with using your card. If you pay off your balance in full every month, your credit card company provides you with a grace period (the amount of time you have to pay the full amount owed before being charged any interest). However, after you miss a payment, most credit card companies will take away that grace period. New purchases will typically generate interest charges from the time they are made, which increases the cost of your regular expenses. If you continue to miss payments, your credit card issuer may impose restrictions on your account, such as lowering your credit limit, preventing you from making any additional purchases, or even putting your account on hold temporarily. In some cases, if you continue not make your payments, your credit card issuer may initiate collection activity against you, which can be very stressful and disruptive.
Users often perceive UPI credit card payments to be easy and fast, therefore forgetting that the payment is actually borrowing money. This mental barrier creates an extremely high likelihood that payments will be missed. In contrast to a bank using UPI, where the immediate debit from the bank account serves as an ATM withdrawal, a UPI credit card does not provide an immediate debit of the amount from the account, which is a reminder that money has gone out.
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Users should make a point of regularly checking their UPI credit card statements and setting up alerts/notifications for the date due for payment. By making at least the minimum payment due, users protect their credit history. However, by paying the full amount, they will be able to avoid interest charges. Treating UPI credit card payments as traditional credit card purchases will prevent subsequent issues.
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Yes, you will incur the same late payment fee as you would on any other credit card transaction.
Yes, late or missed payments are reported to the credit bureaus and can negatively affect your score.
Yes, interest will accrue on the unpaid balance from the due date.
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