INDIA'S BEST CREDIT CARD Payment Easier

What is a Credit Card?

A credit card is a payment card that allows the cardholder to borrow money from a financial institution to make purchases. The cardholder can then pay back the borrowed amount, along with any interest and fees, over time or in full. Credit cards often come with rewards programs, such as cashback or points for travel or merchandise, and offer convenience and security when making purchases.

Different Types of Credit Cards in India

One can come across a few variants of credit cards available for customers in India. These types of credit cards are listed below.

Travel Credit Cards

These cards offer rewards and discounts on airfare, hotel bookings, and other travel-related expenses.

Rewards Credit Cards

These cards offer reward points on every purchase, which can be redeemed for gifts, merchandise, and other benefits.

Cashback Credit Cards

These cards offer cashback on purchases, allowing you to save money while you spend.

Fuel Credit Cards

These cards offer rewards and discounts on fuel purchases.

Lifestyle Credit Cards

These cards offer rewards and benefits on lifestyle expenses like shopping, dining, and entertainment.

Business Credit Cards

These cards are designed for business owners and offer benefits like cashback, rewards, and discounts on business-related expenses.

Student Credit Cards

These cards are specifically designed for students and offer benefits like discounts on textbooks, travel, and other expenses.

Premium Credit Cards

These cards offer premium benefits like airport lounge access, concierge services, and travel insurance.

Co-branded Credit Cards

These cards collaborate with a specific brand or company and offer benefits on purchases made with that brand.

Secured Credit Cards

These cards require a security deposit and are meant for individuals with a poor or no credit history.

Features & Benefits of Credit Cards

Some of the features and benefits of credit cards:

• Credit Limit: A credit card comes with a pre-approved credit limit that the issuer sets.
• Interest Rate: Credit cards charge an interest rate on the outstanding balance on the card.
• Grace Period: A grace period is a time allowed to pay the balance in full before interest is charged.
• Rewards Program: Credit cards offer rewards in the form of cashback, points, miles, or discounts on purchases.
• Purchase Protection: Credit cards offer purchase protection against fraud, theft, and other damages to the cardholder.

Some of the benefits of using a credit card are as follows:

• Convenience: Credit cards are accepted by most merchants, making it easy to purchase goods and services.
• Building Credit History: Using a credit card responsibly can help build a positive credit history, which is necessary for future loans and mortgages.
• Emergency Funds: Credit cards can be used as a source of emergency funds when unexpected expenses arise.
• Budget Management: Credit cards can help track expenses and stay within a budget.
• Travel Perks: Some credit cards offer travel perks such as travel insurance, lounge access, and hotel discounts.

Credit Cards Eligibility Criteria

Credit card eligibility criteria vary from bank to bank and depend on several factors, including income, credit score, employment status, and age. However, here are some general eligibility criteria that most banks look for:

• Age: Generally, the applicant must be at least 18. In some cases, the age limit may be higher.
• Income: The applicant must have a steady source of income. Banks typically require a minimum annual income ranging from INR 1.5 lakhs to INR 5 lakhs.
• Credit score: A good credit score is essential to get a credit card. Generally, a score above 750 is considered good. However, some banks may consider a lower score if other eligibility criteria are met.
• Employment status: The applicant must be employed or have a steady source of income.
• Residential status: The applicant must be a resident of India.
• Documents required: The applicant must provide proof of identity, address, and income. This includes a PAN card, an Aadhaar card, a salary slip, and bank statements.
• Existing relationship with the bank: Having an existing relationship with the bank, such as a savings account or fixed deposit, may improve the chances of getting a credit card.

It’s important to note that meeting the eligibility criteria does not guarantee credit card application approval. Banks may reject the application for other reasons, such as poor credit history or a high debt-to-income ratio.

Documents Required for a Credit Card

Here is a list of documents that are generally required to apply for a credit card:

• Identity Proof: A government-issued photo ID card like a passport, driving license, or Aadhar Card.
• Address Proof: A document that verifies your current address, such as a utility bill, a bank statement, or a rent agreement.
• Income Proof: Documents such as salary slips, income tax returns, or Form 16 that show your income details.
• Employment Details: Information about your job, employer’s name, and contact details.
• PAN Card: Verifying your identity and income tax returns is required.
• Photograph: A passport-size picture may be required.
• Credit Score: The bank or credit card company may check your credit score to assess your creditworthiness.
• Other documents: Additional documents such as bank statements, identity proofs of family members, etc., may be required in some cases.

How to choose the Best Credit Card for You?

Some factors to consider when choosing the best credit card for you:

• Your spending habits: Look for a credit card that offers rewards and benefits for the types of purchases you make most often. For example, if you frequently travel, look for a card that offers travel rewards, such as airline miles or hotel points.
• Interest rates and fees: Compare the interest rates and fees for different credit cards to find the most affordable option. Some cards may offer lower interest rates or no annual fees, while others may have higher fees and interest rates.
• Credit score requirements: Check the credit score requirements for different credit cards to ensure you are eligible. Some cards require excellent credit, while others are available to those with fair or average credit.
• Rewards programs: Look for credit cards that offer cashback rewards, points, or miles for purchases. Determine which rewards program offers the most value for your spending habits and lifestyle.
• Special offers and promotions: Keep an eye out for special offers and promotions, such as sign-up bonuses, introductory interest rates, or waived fees, to find the best deal for your needs.
• Customer service and perks: Research the customer service ratings and additional perks, such as travel insurance or concierge services, for different credit cards to find the one that best meets your needs.

Overall, it’s essential to choose a credit card that fits your financial situation and spending habits to maximize rewards and minimize fees and interest charges.

How to Use a Credit Card Effectively?

Here are some tips for efficiently using a credit card.

• Make a budget: Create a monthly budget and stick to it. This will help you control your spending and prevent you from accumulating debt.
• Pay your balance in full: To avoid paying interest, paying your balance in full every month is essential. This will also help you build your credit score.
• Keep track of your transactions: Review your credit card statements regularly and keep track of your purchases. This will help you identify any fraudulent activity or errors.
• Use credit wisely: Avoid using your credit card for impulse purchases and unnecessary expenses. Instead, use it for necessary expenses such as bills or groceries.
• Choose a card that suits your needs: Consider the rewards, interest rates, and fees before selecting a credit card. Choose a card that suits your needs and spending habits.
• Avoid cash advances: Cash advances can be expensive and carry high-interest rates. Avoid taking cash advances unless it’s an emergency.
• Don’t max out your credit limit: Avoid using your entire credit limit, as it can affect your credit score negatively. Keep your credit utilisation ratio below 30%.
• Use credit card alerts: Set up alerts to notify you of your credit card balance, payment due date, and other important information. This will help you stay on top of your finances.

Tips to Use Contactless Credit Cards

Here are some tips for using contactless credit cards:

• Look for the contactless symbol on your card: To use this technology, your credit card must have the contactless symbol on it.
• Check if the merchant accepts contactless payments: Contactless payments are not yet available everywhere. You can check if the merchant accepts contactless payments by looking for the contactless symbol or asking the staff.
• Hold your card near the reader: You don’t have to swipe or insert your card. Just hold it near the contactless reader, and the payment will be processed automatically.
• Check the payment amount: Always verify the payment amount before tapping your card into the reader.
• Keep your card secure: You should always keep your card safe and secure. Don’t leave it lying around or let anyone else use it.
• Keep an eye on your account: Check your account regularly to make sure there are no unauthorized transactions. If you find any, report it to your bank immediately.
• Be aware of transaction limits: Contactless payments may have transaction limits. Check with your bank to know the limit of your card.

Things to Know Before Applying for a Credit Card Online

Before applying for a credit card, there are a few things you ought to consider and adhere to. They are explained below.

• Your credit score: Your credit score plays a vital role in determining whether you are eligible for a credit card. A high credit score increases the chances of approval and helps you get better interest rates and rewards.
• Interest rates: Interest rates can significantly impact the cost of using a credit card. Be sure to understand the interest rates, APRs, and any fees associated with the credit card you are considering.
• Fees: Credit cards may come with various fees, such as annual fees, balance transfer fees, cash advance fees, and foreign transaction fees. Make sure you understand all the fees associated with the credit card you are applying for.
• Rewards and benefits: Most credit cards offer rewards and benefits such as cashback, points, miles, and other perks. Make sure to compare and understand the rewards and benefits of different credit cards to select the one that best fits your needs.
• Credit limits: Credit card companies may offer different limits depending on your credit score, income, and other factors. Make sure to understand your credit limit and use your credit responsibly to avoid overspending and negatively impacting your credit score.
• Application requirements: When applying for a credit card online, you will need to provide personal and financial information, such as your name, address, income, and employment status. Make sure to have all the necessary documents and information ready before applying.
• Security: It is crucial to ensure that the website you are applying through is secure and reputable to avoid fraud and identity theft. Look for the padlock icon and https in the URL to ensure the website is secure.
• Approval process: The approval process for credit cards may take a few days to a few weeks, depending on the company. Be patient and follow up with the credit card company if you do not hear back within the expected timeframe.