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About Credit Cards

A credit card is a small plastic money issued by a bank which gives the holder an option to purchase goods and services on credit. Many people prefer plastic money over cash just because credit cards come with plenty of unmatched features and privileges.They have become part and parcel of everyone's life because from dining out at restaurants to booking your favourite international flight ticket, you can use your credit card for anything that you like.

What are the advantages of credit cards?

Advantages of credit cards are as follows:

  • Credit cards increases purchasing power of an individual and also ease of purchase.Hence,you can buy things easily with it.
  • If something you have bought is lost, damaged, or stolen then your credit card statement can be proof of the fact that you had made a purchase, if the original receipt is lost or stolen. Thus, credit cards offer you protection of purchases.
  • You should use your credit card wisely that is making payments on time and in full each month will help you build a good credit history.
  • Credit cards is useful in emergency conditions such as if your car breaks down then you have to replace it's parts urgently . You can do payment for it's replacement by your credit card.
  • Some credit cards offer additional benefits, such as discounts from particular companies like Shopper's Stop, Lifestyle, Pantaloons, Pizza Hut, Dominos, Taj Hotels and Resorts

Compare Top Banks with their best credit card schemes in India

Bank Joining/Annual/Renewal Fee Interest Free Period
HDFC Bank ₹ 299-₹5,000 Up to 50 days
SBI GE ₹499-₹4,999 20 to 50 days
ICICI Bank Nil-₹7,000 18 to 48 days
Standard Chartered Nil-₹13,999 18 to 48 days or 25 to 55 days depending on your payment due date. 
American Express  Nil-₹50,000 25 days

How to Choose the Best Credit Card?

When it comes to selecting the best credit card, it is something which is not everyone’s cup of tea. You need to do a through research and should be a keen observer so as to pick the best card. However, there are some important things that you need to always keep in kind while choosing the card which is best for you. Compare different cards on the parameters mentioned below to get the card which is just perfect for you. 

  • Fees/Charges
  • Cash backs
  • Rewards
  • Latest Offers on Travel, Dining, Shopping, Entertainment, etc
  • Fuel Surcharge Waiver
  • Accidental Cover
  • Credit Free Period

 

Features of a credit cards

The features of credit cards vary depending on the card provider and the type of credit card people purchase. Some of them are listed below :

  • It is easy and fast to use a credit card. It removes the worry of carrying various currency denominations as currency notes and coins are heavy and bulky.
  • To improve the sale of products, credit cards come with exciting rewards and bonus points as there is lot of competition among the credit card providers.
  • Many banks offer lost card liability coverage to their credit cardholders i.e. If you loose your credit card then this feature protects the cardholders from fraudulent transactions after they have reported its loss to their card provider.
  • Banks have a separate helpline number for their credit cardholders. Cardholders can contact on this number to get any assistance related to their card.
  • You can avail balance transfer facility that is you can transfer the outstanding balance of the existing card issued by one bank to the credit card account of another bank. Doing this helps in saving money and repaying the amount at a low rate of interest.
  • Some bank's credit cards offer pre-approved loans to their holders at low interest rates.
  • Using credit cards , you can pay all utility bills online. Thus, making it easy and quick for people to pay their utility bills.
  • Banks provide e-statements to their credit cardholders at the end of every billing cycle. You can access this statement at any time online.
  • Some banks offer insurance protection on certain credit cards they offer like travel insurance, life insurance, etc.
  • Credit cardholders can use their cards to withdraw money from ATMs.
  • The credit cardholder enjoys the facility of a credit limit set on his card. This limit of credit is determined by the credit card issuing entity after analyzing the credit worthiness of the cardholder.
  • Credit card gives its holder a unique facility to make payments either in domestic currency or if necessary in foreign currency.
  • Credit card issuing entities like banks keeps a complete record of all transactions made by their credit cardholders.

Benefits of a credit Cards

Credit cards offer lot of benefits for its holders which are listed below:

  • Banks offer a welcome gift to new credit card applicants once the card is issued to them. This gift can be in the form of bonus points, gift vouchers, discounts, etc.
  • All credit cards have a reward program, which allows cardholders to earn reward points on every transaction they make using their cards.
  • Many banks offer fuel surcharge waiver to credit cardholders when they spend specific amount of money on fuel every month.
  • There are certain credit cards that offer cashback benefits to the customers. The amount of cashback that will be offered depends on the card provider.
  • Cardholders can enjoy various lifestyle benefits on their credit cards. Lifestyle benefits include dining, shopping, golf, wellness, entertainment, etc.
  • Some credit cards that offer fantastic travel benefits to the customers. Travel benefits include air miles, airport lounge access, travel insurance, airline offers, hotel offers, etc.
  • Some credit cards offer complimentary Airport Lounge access to their cardholders. The offer varies from one bank to another. Some banks put a limit on the number of visits, while some others allow access only to Indian airport lounges.
  • Many banks allow their credit cardholders to apply for complimentary add-on cards for their immediate family members like mother, father, sister and brother.
  • Certain credit cards such as travel or Airline cards offer Air Miles to their customers. These miles can be JPMiles, Air India Air Miles, etc. Cardholders can collect these miles and redeem them to avail flight tickets and other travel benefits. Example of these cards are Jet Privilege HDFC Bank World, Jet Privilege Platinum etc.

Most Searched Credit Cards

Credit card name Minimum Fee Best used for Other Perks
SimplySave SBI Card ₹ 499 Fuel surcharge waiver and 10x rewards on grocery stores
  • Spend ₹2000 in first 60 days to earn 2000 bonus points
  • 10x reward points per ₹ 100 spend on dining, movies, grocery and departmental stores
  • Spend ₹ 90,000 or above and get annual fee reversal
  • 1 % fuel surcharge waiver across all petrol pumps
HDFC Moneyback card ₹500 Online shopping
  • 2 Reward Points for every ₹150 spends
  • Get 2 X Reward Points on online spends
  • 1% fuel surcharge waived off on fuel transactions 
  • Redeem Reward points as CashBack on your MoneyBack Credit Card 
  • Savings up to ₹1,800 every year on your fuel transactions
ICICI Instant Platinum Credit card Nil Ideal for first time credit card applicants
  • 15% savings on dining at over 800 restaurants
  • ₹100 discount on up to 2 movie tickets per month
  • Earn reward points and redeem for cash
  • On every ₹100 spent on all purchases, except fuel, earn 2 PAYBACK reward points

 

Standard Chartered Platinum credit card Nil Salaried people who are looking a multi-purpose credit card
  • 5x rewards at leading hotels, dining outlets and more
  • Earn 1 reward point for every ₹150 you spend on all other categories
  • Enjoy a host of unrivalled offers on holidays, golfing retreats, movie tickets, dining and more
  • 5x rewards on fuel spends in India
  • Get 5x reward points for every ₹100 spent at hotels

 

American Express Gold Card ₹1000 Universally accepted
  • Welcome gift of 4,000 Membership Rewards (MR) Points after first 3 spends in 60 days.
  • 1000 Bonus MR Points for using your Card 4 times every month.
  • Earn 1 MR point on ₹50 spent on all spends except for spend on Fuel, Insurance, Utilities and Cash Transactions.
  • No predefined credit limit (as it is charge card) Up to 20% off at selected restaurants.
  • Redeem from 18 carat and 24 carat Gold Collection.
  • Earn 5000 MR Points on renewal for second year.

Documents required to apply for a credit cards

  • You must have at least 1 passport sized photograph.
  • Passport, PAN Card, Ration Card, Adhar Card, Voter's ID Card, Driving License can be submitted as ID Proof
  • Address proof like Passport, Rent Agreement, Telephone Bill, Ration card, Electricity bill, Aadhar card has to be submitted
  • Applicant should possess PAN Card, Form 16 and Income Tax Returns Statement.
  • Recent salary slips / certificate for last 3 months/latest bank statement indicating salary credited for minimum 3 months

Credit Card Eligibility

The eligibility criteria for credit cards differs depending on the cards you are applying for and the bank providing it. .

  • You should be atleast 18 years of age to be eligible to apply for a credit card.
  • Most banks offer credit card upto the age of 65 years.
  • If applicant is salaried then annual salary must be atleast 2 lakhs and if self employed, earning must be atleast 1.5 lakhs

How to apply for credit card?

You can apply for credit card online as well as offline.

  • If you want to apply online, you must login the registration page of bank's credit card and enter the required details. Both existing and new customer can apply for credit cards online.
  • Another way is that you can visit the nearest bank branch to fill the application form, which would ask you to state necessary personal, occupational and income details, etc. Subsequently, you should submit the form at the branch along with photographs and other documents.

How to use a credit card ?

  • First of all get a credit card from bank.
  • Start making online and offline purchase. Credit cards can be used for both online purchases as well as offline transactions in shops.
  • To make payments using their credit cards, cardholders have to simply get their cards swiped at merchant stores and authenticate the transaction by entering their PIN number.
  • Some credit cards do not require you to enter a PIN number.
  • If you are using your card to make online payment, make sure the website is a secure one.
  • Enter your credit card details on the checkout section and authenticate the payment by entering the PIN or OTP (One Time Password)

How to make your credit card work better for you?

  • You should keep track of your spending
  • Always pay your credit card on time
  • Repayments should be maximized
  • Set a credit limit
  • Never use credit to make ends meet
  • Regularly check your credit card statement
  • One should close his/her credit card properly