The pre-pandemic period witnessed a steady rise in credit card issuance by 23% in 2020. Although there was a slight decline in credit card usage during 2020-21, it still remains one of the most preferred options for big-ticket purchases. Banks and financial institutions offer various types of credit cards targeting customers with different requirements or spending habits.
Can’t decide which type of credit card you should apply for? Read on to learn about each of the types.
Unlike debit cards, credit cards are credit facilities accessible by a card through which users can perform transactions. Credit cards have a credit limit which is set by the bank and depends on one’s CIBIL score. The CIBIL score defines one’s credit trustworthiness, a piece of information very crucial to banks before they extend credit facilities.
Credit cards contain some basic information like debit cards. These include the user’s name, credit card number, expiry date, CVV code and signature. However, unlike debit cards, they have no link with the user’s bank account and are instead linked to their credit limits.
Credit cards find applications in a wide variety of transactions. Apart from household expenses, appliances and medical bills, you can even perform big purchases like equipment and automobiles with this card.
Also Read: CIBIL Score Calculator And How To Check CIBIL Score Online
Credit cards differ in their choice of offerings and rewards. Therefore, it is crucial to select the ideal one that suits one’s purpose, requirements and lifestyle. In addition, while some cards offer better rewards, others charge low-interest rates. The 3 main types of credit cards are listed below:
Apart from these, there are also some other types of credit cards such as business credit cards, travel credit cards, balance transfer cards, etc.
Also Read: Latest Credit Card Interest Rates: How To Calculate & How does It Work?
Credit cards help customers make purchases on credit payable to the issuer at a later date. Some benefits of using credit cards are as follows:
Also Read: What Are The Advantages And Disadvantages Of Credit Card
October 2021 saw a giant leap in terms of credit card transactions in India, amounting to almost Rs. 1 trillion. Card payment networks like Rupay and VISA provide a secured network to facilitate such transactions. The many different types of credit cards can indeed aid Indians in establishing a cashless economy.
Before you apply for a credit card, find out which type of card would be suitable for you. Compare across banks and make a choice.
Ans: Users with no credit history can reach bank representatives to get a secured credit card. To perform transactions, they must deposit an amount which will determine their credit limit. Regular and timely payment of card bills can help in building a credit score.
Ans: It is possible to withdraw cash from a credit card. However, you might have to pay a cash advance fee for every transaction which is anywhere between 2 to 3% of the amount you take out. You can contact your card provider to know more about this.
Ans: There are specific credit cards that will help you reduce the overall expense of fuel. These are called fuel credit cards. You can avail fuel surcharge waivers at different petrol pumps across the country.
Ans: The eligibility requirement for applying for a credit card is as follows:
– You need to have a regular source of income
– You should be an Indian citizen
– The CIBIL score has to be over 750
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This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.