Credit Card- Apply Online, Compare & Choose the Best

Credit Card Interest Rates

Banks charge a particular percentage as the interest rate on the borrowed amount and this is applicable if the monthly outstanding amount has not been repaid by the card holder. The interest rate is calculated as the Annual Percentage Rate (APR) and always depends on the type of credit card held. The applicable finance charges are determined on a monthly interest rate percentage and is generally calculated on the average daily balance basis for credit cards. While picking up a credit card, customer can always compare the APRs offered on each card and then choose according to their requirements. Customers who can make regular monthly repayments, can choose credit cards with rewards programs and travel loyalty programs. These type of credit cards tend to have a slightly higher APR. If a customer is looking for flexibility with regards to payments and mainly for purchases, then a credit card with a lower APR should be taken. The APR is always determined based on the applicant’s credit score by any financial institution. All banks offer an interest free period ranging from 20 to 50 days to credit card holders as an additional feature.

Different Types of Credit Cards

Airline credit cards: If you love to travel and fly often, you should apply for an airline credit card. Many credit card providers in our country join hands with leading airline companies like Jet Airways and Emirates to offer exclusive discounts on flight tickets to their cardholders. Also, you might get complimentary domestic flight tickets as joining bonus depending on the type of card you hold. Almost all airline credit card available in India are co-branded credit cards as the airline company partners with a credit card provider to issue such cards.

Some of the popular airline credit cards available in India are HDFC Diners Jet, Amex Jet Privilege, ICICI Jet Sapphiro, SBI Air India Signature, Citi PremierMiles Credit Card, and Axis Bank Titanium Smart Traveller Card.

Some of the benefits of holding an airline credit card are as follows:

• It helps you save on your flight tickets.
• Most airline credit cards also offer discounts and cashback on hotel bookings.
• Depending on the credit card you own, you might also get free lounge access in domestic and international airports.
• Co-branded credit cards exclusively designed for travelers usually have a strong reward program which allows the cardholder to earn reward points. Most credit card providers allow their cardholders to redeem these reward points against flight tickets.

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Lifestyle Credit Cards:

Lifestyle credit cards are exclusively designed to offer rewards and discounts on purchases made at selected merchants. These cards are best suited for those who love living a luxurious life. The card issuer offers cashback, discounts, gift vouchers, or reward points when the cardholder shops at selected shopping centers, fuel stations, restaurants, or websites. If you love shopping and spend a lot of money on entertainment or food bills, lifestyle credit cards are ideal for you.

While lifestyle credit cards are designed to offer great benefits for those who shop frequently, it usually comes with a high annual fee. Most lifestyle cards also require you to spend a certain sum of money to avail the discount. This way, you might end up spending more. Therefore, before you apply for a lifestyle credit card, compare various cards available and choose the one that suits your spending pattern. If you have a lifestyle credit card, make sure you check your credit card statements from time to time to check if you are using the benefits your card offers. Most banks waive the renewal fee if you have spent a certain amount on your card the previous year. Get in touch with your credit card provider and check if you qualify for a renewal fee waiver. This way, you will reduce the cost of owning a lifestyle credit card.

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Fuel Credit Cards:

As the name indicates, fuel credit cards help cardholders to save on their fuel bills. Most credit cards issued in India has a fuel surcharge waiver feature. Fuel companies have to pay a surcharge of 1.5% to 2% of the transaction amount to accept card payments. As fuel companies operate at a very thin profit margin, they do not wish to pay this surcharge and often ask the issuer of the card to bear the expense. The banks in return recover this fee from the cardholder. However, few credit card providers are willing to let go of this surcharge and return the amount to the cardholder through the fuel surcharge waiver feature.

If you feel you are spending a huge amount of fuel every month, you could check with your credit card provider if they can waive the surcharge on your fuel transactions. Remember that even if your credit card comes with this feature, it may be applicable at selected fuel stations only. Get in touch with your bank and inquire about this feature and the fuel stations you can use your card to avail this benefit. Also, you can avail the fuel surcharge waiver benefit only if you spend the minimum transaction amount set by your bank.

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Shopping Credit Cards:

If you are someone who loves to shop but have been putting aside your shopping plans because you are not sufficiently funded, you should know more about shopping credit cards. Shopping credit cards help frequent shoppers save while they spend. These cards offer cashback, discounts, shopping vouchers, and reward points every time the cardholder uses the card to shop at the selected merchant’s store. Your credit card provider from time to time will keep you updated about the offers you are eligible to avail. Shopping credit cards offer attractive discounts on dining bills, gym memberships, golf fees, and movie tickets.

Reward points earned on shopping credit cards can be redeemed against your shopping bills or can be converted into air miles and redeemed against your flight tickets. Some credit card companies also allow you to convert the reward points to cash and pay your monthly credit card bill. These cards also help cardholders to purchase expensive products and repay the amount borrowed in Equal Monthly Instalments (EMIs) with 0% interest rate. Which means, the cardholders pay nothing extra. From time to time, banks will announce the promotional codes you can use to avail specific discounts. You simply need to enter the promo code before paying for your purchase to redeem the discount.

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Travel Credit Cards:

When we plan a trip, we always search for coupons, promo codes, or vouchers to reduce the cost of the trip. But, did you know that you can save a lot on your traveling bills if you use your travel credit card for your expenses? What are travel credit cards? A travel credit card is designed to offer exclusive discounts on your travel bills like flight and hotel bookings, cab fare, and dining. Some travel credit cards also offer complimentary flight tickets to their cardholders as a welcome gift.

Most travel cards focus on helping you earn air miles that can be redeemed for free flight tickets or discounts on them. Depending on the type of card you hold, you could also get complimentary airport lounge access, fuel surcharge waiver, concierge services, and free travel insurance. Banks offer generous joining bonuses when you sign-up for a travel credit card. Apart from the reward program, most cards also offer other benefits like free checked bag, free breakfast, and priority boarding. Though these cards are very beneficial, it is important to consider some factors such as the joining fees, interest rate, processing fees, blackout dates, and other fees and charges before you opt for it.

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Business Credit Cards:

Business credit cards are gaining popularity these days. These cards provide business owners with a revolving line of credit which is easily accessible to meet their short-term financial needs. Instead of applying for a business loan, they can use their credit card. Holding a business credit card increases the purchasing power of the business and helps them manage their finances better. Like any other credit card, business credit cards also charge an interest rate if the cardholder does not repay the total outstanding balance on the card in full before the due date or before the interest-free period ends.

As business credit cards do not require collateral, many small businesses in our country prefer these cards to traditional small business loans which require many documents. A business credit card acts as a financial cushion for budding businesses who are not sufficiently funded. Though business credit cardholders get a monthly statement, most banks also allow the employer to track their expenses online like check their year-end account summary, categorize their expenses, run an audit, and pay their taxes. Holding a business credit card helps businesses build a positive credit score if they pay their dues on time, which, in turn, will help them qualify for a line of credit in the future if the need arises.

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Co-branded Credit Cards:

A few decades ago, all credit cards looked the same. Off late, you can see credit cards with attractive logos, designs, and colors. A retail merchant such as a department store, airline company, e-commerce company, or a bank partners with a specific network processor like Visa or MasterCard to issue a co-branded credit card. These cards are designed exclusively to give discounts on merchandise or service they purchase from the sponsored merchant using the card.

If you are someone who loves traveling, you can choose a co-branded credit card sponsored by an airline company like Jet Airways and enjoy cashback, discounts, and other benefits when you travel. But, if you are someone who loves to shop, you can choose a co-branded card that is issued in association with a shopping merchant. Before applying for a co-branded card, take the time out to analyse your spending habits and choose a card that benefits you and meets your requirements. Though, co-branded cards offer you benefits that are tailored to your spending habits, it is wise to use it only when it is required as it has the potential to push you into the debt trap. Check the annual fees and other charges and read the fine print before you get a credit card.

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Corporate Credit Cards:

Unlike business credit cards, corporate credit cards are issued by a company to their employees to pay pre-approved business-related expenses. These cards are usually issued in the company’s name but also display the employee’s name. Most corporate cards come with features like complimentary travel insurance, concierge services, air accident insurance, emergency cash disbursement service, spend management tool, complimentary priority pass program, lounge access, and rewards program.

When it comes to payment, corporate credit cards can be classified into two, namely individual payment card and corporate payment card. If you hold an individual payment card, you will be responsible to track the expenses as per the corporate policy and pay the issuer directly. On the other hand, the company is responsible to pay if it is a corporate payment card. However, non-sanctioned charges should be paid by the employee.

Though corporate credit cards come with great benefits, it has the potential to accumulate huge debt if you do not use it wisely. It is recommended to not use your corporate card for personal expenses however tempting it may be. Most corporates that issue these cards have a dedicated travel card manager who audits the transactions made on the card. Using a corporate credit card for personal expenses will negatively affect your reputation at work.

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Dining Credit Cards:

If you are a foodie and love to taste different cuisines and enjoy your time with your loved ones at a fancy restaurant, dining credit cards are for you. Those who love dining are aware of the problems associated with it like hefty bills. That’s exactly why there is a plethora of dining credit cards available in India that helps cardholders trim their dining bills. What are dining credit cards? As the name suggests, dining credit cards are issued to offer a discount on the cardholder’s dining bills. If you are spending a lot on dining, it is time to compare various dining cards available in the market and pick one that offers you the maximum discount.

Credit card providers tie-up with leading restaurants and eateries and offer vouchers, coupons, cashback, or instant discount when the cardholders dine in any one of the partnered restaurants. This way, cardholders save while they are spending. Most dining credit cards are known for their excellent loyalty program where cardholders are given reward points every time they swipe their credit card to pay their dining bill. Cardholders can redeem their reward points against flight tickets or shopping bills. Few cards also allow the cardholders to use the reward points to pay the monthly credit card bill.

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Entertainment Credit Cards:

If you love going out frequently, entertainment credit cards can help you grab amazing offers. Whether you love watching a movie every weekend or partying hard, entertainment cards are designed to offer excellent discounts on your entertainment bills. Often credit card providers partner with leading movie halls, amusement parks, game arenas, restaurants, bowling centers, spas, and other entertainment outlets to offer a discount to their cardholders.

You may get free vouchers and coupons as a welcome gift if you opt for an entertainment credit card. Most cards offer a discount of 10% to 25% if the cardholder uses the card at any one of the participating merchant’s store. From time to time, your credit card provider might also launch “Buy one get one free” in the selected store. You can use this offer to grab a drink or treat your family to a lovely dinner. With an entertainment credit card, you may also get complimentary movie tickets every month, discounts at spas and salons, golf benefits, cashback on your travel bookings, and attractive dining offers. If you spend a lot of money on entertainment, compare various cards available in the market that might benefit you. Start saving while you spend. This way, you won’t regret it when you check your bank statements after having a great time!

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Rewards Credit Cards:

Almost all credit card in India have an excellent loyalty program under which cardholders can earn reward points every time they use the card to make certain transactions. However, cardholders were required to spend a certain sum of money on their card to earn the reward points. This often pushed them into the debt trap. Reward credit cards were introduced to allow cardholders to accumulate reward points without spending a hefty amount.

Certain reward credit cards available in India allow their cardholders to earn 10X reward points on spends made at department and apparel stores. Most reward credit cards let the cardholder earn reward points for every Rs.125 spent on all purchases. The minimum amount may vary from one card to another. As these cards focus on reward points, cardholders get about 1,000 to 3,000 reward points as a welcome gift. Generally, cardholders will be required to use the reward points within a particular date, post which the points will expire. However, there are many reward credit cards that allow cardholders to save their reward points as long as they want.

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Utility Credit Cards:

Many credit cards that are being issued these days offer cashback and reward points for those who use their card to pay utility bills. Choosing the right credit card will help you save big on your utility bills in the long run. You can use your card to pay your electricity bill, water bill, or your gas bills and earn reward points on every payment. You can redeem these reward points against flight tickets or buy merchandise from selected stores.

However, to avail the benefits, it is important to pay your credit card bill on time. If you are unable to pay the total outstanding bill within the due date, interest will be levied and you will end up paying more than what you initially borrowed. So, the reward points you earn will not be beneficial compared to the additional interest rate you paid. However, if you use your credit card to pay utility bills, accumulate reward points, pay your bills on time, and redeem the reward points to shop or book tickets, you will benefit. Check the annual fees and other charges you will be required to pay before you use your card to pay your utility bills and use it only if it benefits you.

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Golf Credit Cards:

Whether you are an amateur golfer or a professional, there are certain credit cards that offer a wide range of golf benefits. These cards give cardholders access to many golf courses in India and abroad. With a gold credit card, cardholders get free membership to select golf courses. There are certain gold cards that allow their cardholders to avail free golf lessons at select golf clubs. For example, Citi Prestige Credit Card allows their cardholders to avail 4 free rounds of golf per year at 15 of the best golf clubs in India.

Most of the credit card providers offer round-the-clock concierge assistance services to their golf cardholders. Golf credit cardholders also get exclusive spa benefits and holiday packages, depending on the type of card. Before choosing a credit card that will give you golf benefits, it is recommended to check the annual fees and other charges you will be required to pay. If the charges you pay are higher than the golf benefits the card offers, it is not advised to opt for a golf card. However, if the cost of maintaining the credit card is way lower than the benefits it offers, you can apply for a golf card. More than all the other factors, it is important to answer one question- Do you really love to play golf?

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Credit Card FAQs

1. What is a credit card?

   A credit card can be used to purchase services and goods on borrowed credit from the bank that has issued the card. Every credit card comes with various privileges and benefits to suit the lifestyle of a customer.

2. What are the key benefits that Premium credit cards offer?

   Premier credit cards are signature cards from banks which come with flexible spending limits, lifestyle privileges, travel benefits, cashback offers, VIP lounge access, concierge services emergency assistance and complimentary insurance cover. Most premium credit cards can be procured only through invitation.

3. How is redemption done on a cashback credit card?

   The cashback that is earned by a customer can be automatically got as statement credit from the bank.

4. How is a secured credit card issued by a bank?

   A secured credit card is generally issued against a fixed deposit, which has been placed by the customer while availing the card. Any minimum amount due or late payment fee that has to be paid will be taken from the deposit. Secured credit cards help customer build a good credit history

5. How does a prepaid credit card work?

   A prepaid credit card works like a debit card, where the money is taken from an account associated with the card. Users can load cash on the prepaid credit card and can spend up to the available amount limit on the card.

6. What are the features of a Business credit card?

   Business credit cards come with features like business savings plans, rewards programs, cash advance facility, lounge access and customers can also get their company name embossed on the card.

7. How can a customer select the best suited card for himself?

   Any customer should select a credit card according to his everyday needs and lifestyle requirements. The privileges offered with a particular credit card should be beneficial and should add value to a customer.

8. Can a credit card be procured by any individual in India?

   A credit card can be procured by an individual with a regular income and also having a good credit score. Most banks mandate that applicants should be above a certain age limit and should also meet a stipulated income criteria.

9. What is the minimum criteria for applying a credit card in India?

   The minimum requirement to be met while applying for a credit card would be the age criteria. According to the bank, the age criteria varies from 18 to 21 years for a credit card approval to be got.

10. What are the key benefits of the balance transfer option on a credit card?

    Customers can easily consolidate multiple credit card balances onto a single card and repay back with flexible tenure options at low interest rates.

11. Do banks levy any balance transfer fees on customers choosing this option on their credit cards?

    Yes, most banks generally levy a certain percentage as processing fee, when a balance transfer on a credit card is done. The processing fee varies with different banks and customers have to pay this amount with the first monthly instalment.

12. How can users check the available credit on their credit cards?

    Credit card holders can refer to their monthly statements to get the available credit limit. The other options offered to customers are via SMS banking or internet banking services. All banks provide these facilities, where customers can check the available credit by sending an SMS and receiving an alert or by accessing the statements on their internet banking accounts.

13. What are the highlights of the introductory period of a credit card balance transfer?

    When a credit card balance transfer is done, every bank offers an interest free introductory period to the credit card holder. This interest free payment period ranges from 3 to 6 months after which the card holder has to repay the instalments with an additional interest rate.

14. What are the type of purchases that can be made using a credit card?

    A credit card can be used to purchase goods, book travel tickets, perform online transactions and also make reservations for services.

15. Do credit card issuers in India offer co-branded credit cards?

    Yes, there are various co-branded credit cards available in the market from different card issuers. The privileges available in a co-branded credit card are generally determined by the issuing bank.

16. Can customers increase the predetermined credit limits on their credit cards?

    Yes, most banks give the option of increasing the credit limit available based on the usage pattern. Sometimes the banks might automatically increase the credit limit after reviewing the customer’s spending pattern. Otherwise if a cardholder wishes to increment the credit limit, then a special request has to be placed with the concerned bank.

17. What is a Purchase introductory rate?

    The purchase introductory rate is the low interest rate that is offered during the first few months of the credit card usage. This introductory rate is generally given to customers with good credit scores. These rates might be applied only to purchase transactions or balance transfers done by the card holder.

18. Do credit cards come with specific cash withdrawal limits?

    Yes, most credit cards come with preset cash withdrawal limits, which is generally communicated by the bank to the customer at the time of approval. Banks might also levy additional withdrawal charges on every transaction done at an ATM within India or abroad.

19. How does a credit card work as a cashless payment instrument?

    A credit card is a payment card issued by a particular bank for customers looking to avail instant credits to easily purchase goods and services without spending a single penny from their pockets. The bank extends a line of credit with which the user borrows money, to be paid to a merchant. The cardholder is required to pay back the borrowed sum of money subsequently to the lender bank along with extra interest rates.

20. How do I own a credit card in India?

    Customers need to get in touch with an executive from a bank of their choice and submit a filled-in application form with the required documents. The bank will process your application after appraising your credit history and will then approve the new credit card according to your requirements.

21. How important is it to understand the interest rate charged by a bank on a particular credit card?

    In India, banks charge the highest rate of interests for credit cards, from 36% to 42% per annum. A bank decides the interest rate for a particular customer based on his credit history, financial capability and also depending on the type of card he chooses. Applicants with good credit scores and regular payment patterns get the best deals on their credit card interest rates.

22. What are the different payment networks utilized by banks in India for credit card transactions?

    Banks in India have tied up with Visa, MasterCard and American Express (AMEX) to process credit card payments, connecting merchant accounts with the acquiring banks.

23. What are the eligibility requirements to be fulfilled while acquiring a credit card?

    In India, banks generally offer credit cards to individuals above the age of 21 and with a steady monthly income. As part of their verification process, banks do a deep dive into the customer’s credit history and assess previous payment patterns to understand the customer’s financial situation. Only after ensuring that the applicant has the financial capability to repay the expenses incurred using a credit card, will the bank approve the customer’s application.

24. Is there a minimum salary criterion required to be met while applying for credit cards in India?

    Yes, in India applicants are required to earn a minimum of Rs 75,000 to 1 Lakh per annum, though this criterion varies depending on the type of the card.

25. What does APR refer to with respect to a credit card?

    Annual Percentage Rate (APR) or the ‘’cost’’ at which a customer takes credit from a bank, is the simple interest rate charged by a bank on expenses incurred on a credit card for a year.

26. Do banks levy any charges for late payment of credit card bills?

    The best mantra while managing a credit card is to ‘’Pay as and when you can”. Delaying a credit card payment is not a wise option, as banks tend to impose high late payment fees and gradually increase the interest rates charged. The customer would actually end up paying way more than his original purchase amount.

27. Do add-on or supplementary cards carry the same features as their primary credit cards?

    Add-on cards can be taken for family members of the primary card holder with extra charges anywhere between Rs 125 to Rs 1000. The credit limit of the primary card gets carried over to the new card with similar features. Also customers can get a comprehensive bill with details of both the cards.

28. How do global cards help a frequent traveller?

    Global credit cards give a customer the leeway of instantly performing cashless transactions from any corner of the globe. Accepted worldwide, global cards give you the flexibility of spending in any foreign currency and later paying your bills in your local currency. A customer can also avoid the hassle of carrying huge amounts of cash or using traveller’s checks.

29. What do credit card reward programs offer?

    Credit card reward programs have been introduced by lenders to popularize the various cards they offer by rewarding a customer for transacting using their credit card. The cardholder is awarded points as per his expenditure for purchasing goods and services. The accumulated points can later be redeemed by customers for certain discounts and gifts as per the bank’s guidelines.

30. What measures are Indian banks required to take to avoid credit card fraud?

    The Reserve Bank of India mandates the provision of multiple levels of authentication from banks, for customers using credit cards to make an online purchases. Additionally, customers are advised by banks to use their credit card credentials only in encrypted internet connections to avoid fraudulent transactions.

31. How does the cash advance facility help an Indian credit card holder?

    Customers can also use their credit cards as ATM cards and withdraw a stipulated amount of cash, preset by the bank as cash advance. Though this feature gives a customer access to instant cash, the bank charges very high interest rates for credit taken using this facility.

32. What are the different online and offline modes available to customers for making credit card bill payments?

    A. Customers can make outstanding credit card bill payments using the following online modes - Net Banking, NEFT / RTGS Transfers, Debit Cards, Mobile Applications, Standing Instructions, Visa Money Transfer, Bill Desk, etc. Offline modes include cash, cheques, demand drafts, etc.