Santa Claus comes around just once a year. In the meantime, there are Credit Cards.
Credit cards against fixed deposit, technically termed as Secured Credit Cards, are an ideal option to those who have a no credit history or poor/no CIBIL score.
While getting a regular credit card requires you to have a stable monthly income, good credit score and others, for a secured credit card, you simply need a minimum fixed deposit with the bank.
Let’s check other details about availing credit cards against fixed deposit, their merits, demerits, how to apply and other information in detail.
A secured credit card is a credit card variant that can be availed against a fixed deposit (FD) with the bank or card issuer.
Each bank specifies a minimum fixed deposit amount to apply for a secured credit card. The amount in your FD account is directly linked to the total credit limit on your credit card. This means, the higher your FD amount is, the higher would be your credit card limit. Banks typically provide 75% to 85% of the FD amount as the credit card limit.
When you open an FD with the bank and apply for a credit card against it, you don’t have to submit any other income proof to avail the credit card.
The FD serves as the security deposit against the credit card. In case of default on the credit card payment, the bank or the credit card issuer reserves all the rights to break your deposit.
However, before initiating such an action, the bank would intimate you through all possible communication channels.
On the other hand, a secured credit card in good standing for a stipulated amount of time, let’s say one to two years, would prompt the bank or the issuer to delink your FD.
Holding your credit card in good standing implies keeping it active, using it within the spend limits, repaying the dues on time every month and a consistent spending pattern.
Some of the banks that offer credit card against fixed deposits in India are:
Compare the amount of Fixed Deposit required to apply for the secured credit cards or the credit cards against FD among the below top banks in the India in 2023.
| Credit Card Variant | Fixed Deposit Required | Joining fee/Annual Fee |
|---|---|---|
| Axis Bank Insta Easy Credit Card | Min. Rs.20,000 | Joining fee: Rs.500; Annual fee: NIL |
| SBI Card Unnati | Rs.25,000 | First 4 years – NIL 5th year onwards – Rs.499 |
| Kotak Mahindra Aqua Gold Credit Card | Rs.25,000 | NIL |
| Union Bank of India Usecure Credit Card | Rs.25,000 | NIL |
| YES Prosperity Rewards Plus Credit Card | Rs.50,000 | Rs.350 |
| YES FIRST Preferred Credit Card | Rs.3 lakh | Rs.2,500 |
| Bank of Baroda Assure Credit Card | Not Available | Rs.500 |
| Andhra Bank Visa Classic | Rs.10,000 | Rs.400 |
| Andhra Bank Visa Platinum | Rs.10,000 | Rs.400 |
| DCB Payless Credit Card | Not Available | Rs.350 |
The eligibility criteria to apply for a credit card varies for each secured credit card. A few factors, however, are common for all the cards including the age and minimum fixed deposit requirement.
As we have already discussed about the minimum deposit required, let’s check the age criteria for each card.
| Credit Card Variant | Age criteria |
|---|---|
| Axis Bank Insta Easy Credit Card | Minimum 19 years |
| SBI Card Unnati | Minimum 21 years |
| Kotak Mahindra Aqua Gold Credit Card | 18 years to 75 years |
| Union Bank of India Usecure Credit Card | As mentioned by the Bank |
| YES Prosperity Rewards Plus Credit Card | 21 years to 60 years |
| YES FIRST Preferred Credit Card | 21 years to 60 years |
| Bank of Baroda Assure Credit Card | As mentioned by the Bank |
| Andhra Bank Visa Classic | 21 years to 70 years |
| Andhra Bank Visa Platinum | 21 years to 70 years |
| DCB Payless Credit Card | As mentioned by the Bank |
Hence, it’s imperative to visit the nearest bank branch to open your FD account first followed by the credit card account.
While some credit cards are issued as complimentary for having an FD with the bank, others need to be applied for.
Once you open your fixed deposit account with the bank, you can apply for the credit card at the same branch by filling up the application form for the same.
You can also apply for the secured credit card online, once your FD account becomes active with the bank.
Having a secured credit card provides the following benefits –
Credit Cards against Fixed Deposit is suitable for which category people?
A credit card against FD has a low credit limit, therefore by using it responsibly, you can use it to improve your credit score.
Yes, by adding more money in FD, you can increase the credit card limit.
No. You cannot deposit money using your credit card.
No, you cannot transfer money directly from a credit card to a bank account.
Yes, almost all banks allow you to withdraw money from an ATM up to 100% of the credit limit. The credit limit on your card will be 85% of your fixed deposit amount.
Banks usually offer around 80% of the amount of your fixed deposit as your credit limit.
No, Indian banks do not allow the facility of credit cards against fixed deposits for any foreign national.
The minimum amount for a fixed deposit for a secured credit card will differ from one bank to another. A few banks will give the cards at fixed deposits starting from Rs.10,000 and a few banks might ask you to create a fixed deposit of Rs.25,000 or more.
You must have the minimum deposit to have a secured credit card and the money gets locked for the entire FD tenure. Failure to make payment would hurt your deposit as well as your credit score.
Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.
