Saturday , 24 February 2018
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Now, pay LIC Premium via Credit card (Visa & MasterCard)

In our previous post about paying lic premium, we have listed 8 different ways to pay your lic policy premium. One of those is via ‘LIC’s customer portal’. Through the portal, till today, you only had the option of paying through Internet Banking or VISA Debit card. Now, LIC has also added an option of paying through VISA and Master Card Credit cards.

The process of paying is similar to paying via Internet Banking or Debit Card. While logged in to the portal, select ‘Pay premium Online’. Then select the type of policy for which you want to pay the premium (such as Conventional or ULIP’s). You will then be shown the policy (or policies) which are due for payment. Select the policy and go to the payment page where you will now select ‘Credit cards’ instead of ‘Internet Banking/Debit cards’.

You can use any VISA and MasterCard credit or Debit card. The transaction is done via IDBI payment gateway.

LIC Premium payment via Credit Cards

The point to note here is, you will be required to pay an extra service fee (the merchant service fee) if you are paying via Credit or Debit cards. In case of payment via Internet Banking, there is no such additional fee. The service fee is as follows:

Debit cards (any amount): Rs.12 per transaction

Credit cards (for premiums up to Rs.5000): Rs.18 per transaction

Credit cards (for premiums over Rs.5000): Rs.35 per transaction

So, needless to say, it is advisable to use Internet Banking if you have the facility instead of cards. If you still prefer paying through Credit cards (in cases where you are short of ready money), keep in mind the above service fees and also keep ready your Verified by Visa (for Visa cards) or MasterCard Security codes (for MasterCard).

Update: Now there are different charges for Debit cards too. For payments up to Rs.1600 using debit cards, 0.75% of the amount will be charged as convenience fee. Any amount over it will be charged at earlier rate of Rs.12 (flat).

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  1. There was even a petition filed to revoke extra charges for the payment of premium through online.

  2. YES, the Service Tax is absolutely on Convenience Fee not on the premium.
    I just paid through my Credit card and after confirmation on deducted amount i’m making this statement.
    One can happily pay using C card.

  3. The charges mentioned here are old ones. Newly they started charging very high when paid through credit cards.

    Debit Cards:
    0 to 1400 – 0.75% + Service Tax(14.5%)
    1401 to 10000 – 10 + Service Tax(14.5%)

    Credit Cards:
    0 to 5000 – 20 + Service Tax(14.5%)
    5000.01 to 10000 – 45 + Service Tax(14.5%)
    10000.01 to 25000 – 80 + Service Tax(14.5%)
    25000.01 to 50000 – 190 + Service Tax(14.5%)
    50000.01 to 100000 – 350 + Service Tax(14.5%)

    They have highly increased the payment gateway charges when paid through credit card.

    • Yes there is a big change in Convenience charges and Service tax. It costs me around 1400 for policy having Payment amount ~53000. If I could know I should have paid by cash.

  4. Charges are revised for credit card

    • Hi
      What is this service tax? Gateway IDBI bank is charging 12.36%. If I calculate for Rs.39542 with 12.36% service tax its about Rs.4887 is only tax. I am bit confusion how they charge thismuch for a month. Please let me know the details.

  5. Refer below link for service tax calculation…

    Even I was under misconception earlier but above link cleared all my doubts.. Its official lic india link… It can be used to prove any credit card banks..



  7. Service tax is only on fee not on premium… 12.36% of Rs 12 and not premium. This discussion scared me. But I confirmed and paid using debit card only. Costed me some Rs 14 extra.. which is fine.

  8. I check with HDFC credit card customer care. they said 12.36% of total premium.
    my premium is 35000 inr. tax would be abt 4400 inr.

    from nowhere, i can earn 4400 inr from 35k in one month.. as i need to pay credit card bill next month.
    I don’t know who gave LIC so much mind. or it is also in the row of corruption and money making.

    @ Madhu, if you are sure, pls send me some satisfying proof as i dint pay after talking to HDFC.

    from what is shown above, this tax is there even if we use debit card..
    LIC must have provided full clarity there.

    • I don’t have proof yet since I pay using Internet Banking (absolutely no charges here).
      I think the person who you talked to at HDFC wasn’t in his senses. It just doesn’t make any sense. I’d suggest you call the bank again and talk to another person to confirm that this is wrong. I’m 100% confident that it doesn’t work this way.

      • Dear all

        I confirmed with LIC customer care and made payment by credit card only.
        only extra payment was INR 35 + (service tax 12.36% on rs 35)

        HDFC customer care was a fool…. (may be that’s because it was a lady)
        I confirm.. tax is on convenience fee, not on the premium.

        So enjoy by making payment by credit card.

  9. Emergency worked like this accident.
    Then important the credit card thanks.

  10. Satishchandra Shukla

    Just i wanted to ask one point; Convenience fee is given as Rs 35 for premium amount above 5000/- But how much service tax will be taken. Is it 12.36% of Rs 35 or service tax will be applicable on premium amount. Can you please confirm if any one had paid in past through credit card.

  11. unnecessary why we pay extra money ! credit card point scheme is there !

  12. Lol, why will I want to spend extra by paying through credit card?

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