11 Credit Card Fees Every User Should Know

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In the current economic scenario of India, we’re talking about demonetisation, using credit cards over apps and cash is very understandable. However if you thought that credit card do not cost anything until the due amount is paid on time then you are wrong.

Although credit cards give you comfort and convenience, there are various charges associated with them apart from the late payment fees. And these charges if goes unnoticed can put card holder in a debt zone unknowingly. So next time before swiping the card, read the card statement showing various costs minutely. Alternately you can also read the fineprint i.e. document which mentions the terms of card usage.

Here are costs, paid by the card holder:

Annual fee: This is the fee charged by the card issuer every year. However this may be waived off when certain pre-fixed amount is spent in a year. Normally Rs. 200 is the minimum annual fee charged by most of the card issuing company. However there are cards with no annual fee available in the competitive card market.

Late payment fee: Almost every card owner must be knowing this fee. This is a fee paid when the balance is not paid on time. A flat fee is charged irrespective of the number of days delayed or depending on the card type.

Overdraft charges: If spend on the card is higher than the credit limit then a fee is charged known as overdraft charge. It is a fixed percentage of the overdrawn amount.

Foreign transaction charges: If you purchase any product or pay for any service in currencies other than Indian rupee, then this fee is charged which is typically in the range of 3%-5% of the transaction amount. This is commonly seen in online transactions when products/services are purchased in foreign currency.

Service tax: Expenses on the credit card are subject to service tax which is levied on the total value of the transaction at 14% service tax applicable on the intrest, fees, and charges.

Outstation cheque fees: If you use an outstation cheque to settle your credit card dues, then you will be charged a fee which is a certain percent of the cheque value subject to a minimum amount.

Cash withdrawal charges: Withdrawing cash from ATM with credit card attracts charges. The transaction charges on cash withdrawal are as high as 2.5% of the cash advance.

Duplicate statement fee: Cardholders are charged a fee on request for issuing a duplicate card statement.

Revolving interest rate: If you do not pay your final due amount before the final date, then you would be charged 1.99%- 4% interest every month.

Cheque bounce: In case, you make a card payment via cheque and it bounces or there is a failure of ECS, it would attract a fixed amount penalty by the card issuer.

Petrol and railway ticket: Using the credit card to fill petrol or rail tickets attracts additional charges. This charge is a flat percentage of the amount spent. Check out credit cards for fuel purchase in India along with their benefits.

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14 Credit Cards for Frequent Flyers: Free Tickets, Rewards, Miles & more

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With rising globalization, people have to travel across countries. And especially business class people who have to travel frequently, are always on a look out for saving money on their travel. This includes cheaper air tickets, dining, etc.

However the most expensive part of travel is the flight ticket which is typically booked online or at the airports. Credit card is the most commonly used payment mode for booking air tickets by businessman or other frequent travelers. Although any card can be used for booking airline tickets, there are credit cards for frequent travelers offering exclusive benefits keeping travel in mind.

Listed in the table below are the best credit cards for frequent flyers. All of these cards offer complimentary lounge access:

Card NameIssuing BankReward Points / Cashback / Air Miles EarnedAnnual Fee (In INR)
Platinum CardSBI> 20 Reward points for every ₹ 100 spent on AI tickets (1 Reward point = 1 AI Air mile)
> 20,000 Reward points as a welcome gift on payment of joining fee
Yatra CardSBI6X points on spends at Yatra.com499
EliteSBI> Upto 50,000 Bonus points worth Rs. 12500/year
> 15,000 bonus points on spending Rs. 5 lakhs and 8 lakhs every year
Elite AdvantageSBI> Upto 50,000 bonus points worth Rs.12500/year
> 10,000 bonus points on spending Rs. 3 lakhs & 4 lakhs annually
Vistara InfiniteAxis Bank> Complimentary Business Class ticket on spending Rs.2,50,000 or Rs.5,00,000 or Rs.7,50,000
> 10,000 bonus points on spending Rs.1,00,000
Vistara SignatureAxis Bank> Complimentary Premium Economy class ticket on spending Rs.1,50,000 or Rs.3,00,000 or Rs.4,50,000
> 7500 bonus points on spending Rs.75,000
VistaraAxis Bank> Complimentary Economy class ticket on spending Rs.1,50,000 or Rs.2,50,000
> 1000 bonus points on spending Rs.50,000
PremierMilesCitibank> 10 Miles for every Rs.100 spent on all airline transactions
> 10,000 Miles on spending Rs.1,000 or more
> 3,000 Miles on renewing the card
British Airways ClassicICICI Bank> 25,000 Avios on travelling from British Airways return ticket from India to England
> Up to 5 Avios per ₹ 100 spent
Jet Airways SapphiroICICI Bank> 10,000 welcome bonus JPMiles
> Upto 7 JPMiles/Rs.100 spent
> 5,000 bonus JPMiles on card renewal
> 5% discount on Base Fare for all domestic / international air ticket (revenue flights) bookings made Jet airways website
AllMilesHDFC Bank> Spend Rs. 150 and earn 3 points. 100 Reward Points = 75 Air Miles / INR. 75 worth of air coupon.Communicated at the time of application
InfiniaHDFC Bank> 5X Reward Points i.e., 20 Reward Points for every Rs. 150 spent on Make My Trip10000
Regalia & Regalia FirstHDFC Bank> On both the cards, earn 8 Reward Points by spending INR 150 and convert into airmilesCommunicated at the time of application
RegaliaKotak Mahindra Bank> On joining, get air ticket voucher worth Rs. 2000Communicated at the time of application

What benefits you should expect from such premium cards?

When you pay high annual and joining fees, you would certainly expect best return/benefits out of it. Here are the features frequent travelers should look for while buying credit card especially for travel:

Easily redeemable on domestic & international airlines or dining, shopping & others: Redemption of reward points earned should be easy. For frequent flyers, points should be redeemable on any flight (domestic/international) and most importantly at any airline.

Lounge access: Flight delays/cancellation, noisy crowd, and other types of chaos are very cumbersome and very common at the airports. And at the world’s busiest airports the situation becomes more irritating especially for frequent flyers. This is the reason why such people want quiet secluded environment and comfort even at the airport. This is why facilities offered at airport lounge are helpful as they provide best amenities/facilities and most importantly complete peace. Exclusive lounge access is must to have benefit in cards specially designed for individuals who travel frequently.

Personal accident insurance: This provides coverage when the card holder meets any accident while travelling via air/rail/road. Such situations are quite common and paying such a high fee for travel credit cards should definitely come with protection through insurance. Imagine a situation, when you meet any unfortunate event in some foreign country, who will take care of your family in the home country? Coverage offered by card issuing company will come to rescue your dependents in the form of fixed sum assured.

Priority pass access: It is the world’s independent airport lounge access program. Exclusive card owners can get priority passes before their flight so that they can relax in peace.

Renewal privileges: It should not happen that the benefits offered after buying a card is limited in the first year only.

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13 Credit Cards for Grocery Shopping in India with Reward Points

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There are credit cards for almost every usage which includes fuel purchase, travel, entertainment, and many others. As more and more merchants online and offline are going digital, the demand for cashless economy is set to rise in India. And after demonetization, the usage of plastic money is certainly going to boost.

According to the report by India Brand Equity Foundation (IBEF), the retail industry is expected to reach USD 1 trillion by the year 2020.

Grocery or day to day purchases are very common and every one wishes to buy stuffs which offers discounts or offers. Although in India, cash transactions is widely used, there are individuals who make use of credit cards for everyday purchases. Listed below are the cards for grocery shopping:

Card NameIssuing BankNo. of Reward Points
SimplySaveState Bank of India10x per Rs.100 spent
BuzzAxis Bank5% off at Flipkart
6 eDGE Loyalty Reward Points on every Rs.200 spent online
2 eDGE Loyalty Reward Points on every Rs200 spent
Rubyx American ExpressICICI Bank6 Payback points on every Rs. 100 spent
Coral American ExpressICICI Bank2X Cash rewards
Coral & Rubyx MasterCard ExpressICICI Bank4 Payback points on every Rs. 100 spent
IndianOil Citibank PlatinumIndusInd2x with every Rs.150 spent
SolitaireHDFC Bank3 reward points for every Rs. 150 spent
Diners clubHDFC BankDouble Reward Points on Grocer, supermarket purchases
3 Reward Points on Rs 150 spent
FreedomHDFC Bank5% Cash back
Prosperity CashbackYES Bank5% Cashback
Prosperity CashbackYES Bank5% Cashback
IndianOil Citi Titanium & Platinum CardCitibank1 point per Rs. 150 spent
EssentiaKotak Mahindra Bank10 Saving Points for every Rs. 100 you spend

Things to look for while buying credit card for grocery in India:

Easily redeemable: Every point you earn on shopping should be easily redeemable either in cash or gift card or others. But prefer a card which offers cash option.

Acceptance at majority of supermarkets or local or small grocery stores: Read terms and condition of the card mentioning the supermarkets/local stores where card is accepted. Ideally you should buy a card which is accepted at most of the stores irrespective of the size.

Low interest rate: If you are heavy shopper and solely rely on credit cards for grocery or any other type of purchase, then buy a card with low interest rate. Because a single missed or delayed payment will carry a charge in the form of interest rate. Check out few cards which offer low interest rate.

Zero annual fee: Although it is very difficult to find credit cards with zero annual fee which offers cashback or reward points. But if your sole intention of buying a card is very general then you can look for these cards with no annual fee.

Who should buy credit cards for grocery shopping?

Normally in India it is women who takes care of grocery shopping in India be it online or any store. So those who are frequent shopper should buy such cards. Check out cards for housewives in India.

Such cards are more recommended for heavy shopper. Those who do not spend much on grocery shopping should avoid buying card with the purpose of just grocery.

Buy such cards as an add-on card for someone with no credit history. With timely full payment, this can help in building credit history for individuals with no credit in the past.

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After credit card rejection: 4 things you should do

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Between Jan2016-Jun2016, non-performing assets (NPA) of banks have risen according to the reports. And Indian banks now have NPAs close to 6 Lakh Crore i.e bad loans. So application for any type of credit is now scrutinized minutely by financial institutions in order to prevent grant of credit to predicted, frequent defaulters or the ones who do not fit eligibility criteria of the bank.

So what should you do when credit card application is rejected?

First of all, do not worry and take action without giving any thought. And also do not think that you will never get a card again. Normally upon card rejection, the next step everyone takes is to immediately make application at some other lender. But this is not recommended.

Here’s why and what you should do instead:

Ask for a reason: The first important step is to contact the concerned lender and ask for the reason for card denial. Now, there could be many reasons such as poor credit score, incorrect details mentioned, improper documentation, etc. If there is a minor mistake from your end, for e.g. if you forget to submit salary slip or mention incorrect salary, then ask lender to reconsider your request after providing the correct details.

Work on improving credit: If the reason for denial is poor credit score which can be due to multiple reasons; common ones are late, delayed, or missed payment, then your first job is to start working on improving the credit score. Your whole financial future is dependent on CIBIL score. A poor score will always create hindrance in getting any type of credit. The most recommended solution for improving CIBIL score is to make repayments on time and fully. Stay away from the habit of paying minimum balance. Also spend card wisely without crossing the card limit. Your aim should be to reach CIBIL score of 750 and above.

Apply only for card which you are eligible for: Market is flooded with various cards with each offering different features and benefits. And it is obvious that everyone will get attracted towards card offering exciting benefits such as lounge access, free air miles etc. But many such cards are designed for individuals with high income/frequent traveler/businessman & others. So if your card was rejected due to any of these reasons then next time check eligibility criteria first and then apply for a card. Remember every rejection counts.

If mistake is from bank’s end: Do you know that many a times, mistake at bank’s end can also result in card rejection? This could be due to various reasons. The most common one is delay in updating CIBIL record or incorrect data sent to CIBIL. As per rule, bank has to submit data to CIBIL every 30-45 days. Suppose you closed your previous loan account by paying all dues in June and apply for a fresh card in September. But if previous bank do not send recent data of your card account closure before you apply for the card at the new bank, then denial chances increases since you are still have balance dues as per credit information report at CIBIL.

In India, there are other options as well in case normal application still gets denied and these options are: add-on cards and credit card against fixed deposit also known as secured card.

Before applying for a card, get credit information report from CIBIL:

Next time you apply for a card, first check your credit score, and then take decision to apply for a new card. This way you can estimate whether or not it makes sense to apply for a card and which card. Else opt for add-on cards or secured credit cards. You won’t end up in the list of card denied. In case of any errors in CIBIL report, you can raise a dispute which they will try to correct at their own end or forward to the concerned lender.

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Credit Card Rejected: Are You at Fault or Lender?

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With rising non-performing assets, lenders have now become very strict. The sole objective of rejecting credit card application is to minimize losses. We all take similar action in our everyday life. For e.g. when your mobile phone bill shoots up, we move to lower plan or switch to some different operator offering cheaper deal. And that’s what lenders do – when loan or credit card payment defaults rise, they target only no risk individuals and straight away reject other risky applicants.

So now the question arises – when card application is rejected in India are you always at the fault or is the bank also responsible?

When you are at the fault:

  • Late or delayed payment: This is the most common and obvious reason for credit institutions rejecting your application. For them, you fit into the category of defaulter.
  • Incorrect or insufficient information provided: When making application for card, many a times you might enter incorrect or insufficient details such as incorrect income, fake employment status, etc.
  • Too many applications in short time period: Too many applications within a short span of time shows credit hungry behavior of an applicant. And banks take this very seriously.
  • Too many credit currently ongoing: If you have credit accounts with multiple banks then chances of rejection increases. Because from a creditors eye, it is another sign of credit hungry.
  • Income and employment: Every lender has strict income limit below which card cannot be granted. If your income is low then you are less likely to manage debt properly. Your employment also plays a very important role. A person working in listed company is more likely to get card compared to the one working in a small company. In such cases, if income is high even though you are working in a small company then approval chances increases.

When mistake is from bank’s end:

Now let’s understand scenarios when your credit card application is rejected due to mistake at lender’s end.

  • Failure or late in updating CIBIL record: Whenever you apply for a credit card, bank first checks your CIBIL report to understand your financial transactions such as current credit, previous late or delayed payments, frequency of applications etc. If they find unpaid dues, then chances of rejection increases. Now this doesn’t mean that – you have not paid bills. It might also happen that – CIBIL records are not updated. You may have fully paid the bills but banks failed to update CIBIL. In such cases, you should immediately approach concerned bank and notify about the mistake and most importantly ask them to submit correct data to CIBIL. As per rule, credit institutions are ought to submit data to cibil within 30-45 days. Such errors are quite common, so before you plan to apply for loan or credit card, check your CIBIL report once. At the same time, you should raise a dispute on CIBIL’s official website – https://www.cibil.com/. Check out tips on improving CIBIL score.
  • Do not completely close the account: Post closure of card or loan account, it is your responsibility to get no objection or no due certificate and original documents from the lender. NOC in this case means – you do not owe anything to the bank and all the dues have been fully paid off. NOC will help in case of any dispute in future especially when you apply for a new credit.
  • Incorrect details entered: Many times it happens that you make card application on paper. Banks then feed these details manually in their computers record. And then verify all your details to decide on whether to give credit or not. But imagine a situation when your monthly salary entered is Rs. 100000 (1 Lac) but banks enter as Rs. 10000 (ten thousand). Your card rejection chances increases. Check out credit cards for low salaried individuals in India.
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HSBC Credit Card Payment: 13 Options – Online & Offline

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In order to provide convenience to their customers, HSBC offers following 13 options to make credit card bill payment.

8 Online Options: There are multiple ways to pay HSBC credit card payment. This includes from HSBC & other bank’s online facility.

Here is the table showing all the payment methods along with the details of each.

From HSBC BankFrom Other BanksOffline Options
Cash payment
Mobile AppVISA money transferAt HSBC ATM
Mobile WebsiteECSMail cheque/draft
Direct DebitBill DeskPayment over phone

From HSBC Bank:

  1. From HSBC website: Through internet banking you can pay your monthly bills in a hassle-free way. The steps are very simple. Just login to HSBC netbanking using username and password provided by the bank. Visit credit card section and you will see due amount. Just click on paynow and complete the payment process. You can either pay minimum amount or full payment.
  2. Mobile website: Process is similar as mentioned in the above option. Only difference is you need to open the mobile version of the website on your smartphone.
  3. Mobile app: Almost every bank now offers app to provide good customer experience. HSBC’s app name is HSBC Mobile Banking and is available on Android and iOS store. Prerequisite for using the app is that you need to be a registered user of personal internet banking with the bank.
  4. Direct debit: This is considered to be the most convenient option to pay credit card bill. You just need to enter card details once and set date on which money to get auto-debited from your HSBC account. On the set date, money will be automatically debited and transferred to the card account. No need to remember due date every month.

4 payment options from other bank:

  1. NEFT: With this you can pay monthly card payment from account held at non-HSBC bank. You will have to login on the bank’s website and enter 16 digit card number and IFSC code which is HSBC0400002.
  2. Bill Desk: Another option provided by the bank is bill desk. Visit http://billdesk.com/hsbccard/ and securely pay the bills from account held at any bank. You will find almost every bank listed on billdesk. Keep following details handy: 16 digit card number, E-mail ID and mobile number as mentioned in the bank’s record. The transfer is instant.
  3. VISA money transfer: Yet another fastest way to pay credit card bill is from the card held of another bank.
  4. ECS: You can also allow HSBC bank to directly debit money from another bank account on a set date. With this, you can avoid missed payments which often impacts your credit history. Check out how to improve CIBIL credit score.

5 Offline Options:

  1. Cash payment (over the counter): This option is not recommended as it is time consuming as you have to visit bank physically. Moreover Rs. 100 is charged by the bank for cash payment.
  2. At HSBC ATM: You can deposit cash or cheque at any of the ATM. But remember that, the day you deposit does not mean the card bill is paid. It takes 2-3 business days for the actual payment. So make sure to deposit atleast a week in advance. Or else use other methods mentioned in this article.
  3. Mail cheque/draft: You can mail cheque or demand draft of any or same bank and send it to the nearest HSBC bank’s branch.
  4. Payment over phone: With phone banking, you just need to dial following toll free numbers preferably from your registered mobile number. 1860 108 7788 or 1860 500 2277. Keep HSBC Credit Card or Banking Account / Phone Banking Number & Phone Banking PIN details handy before calling.
  5. Dropbox: Although this option is available in Mumbai, it is not recommended especially if you are depositing cash. This is because bank charges Rs. 100 in addition to other fees as per their terms and conditions. If you still want to use this option, then cheque or DD should be preferred. In Mumbai, dropboxes are located at multiple places in western, harbor, and central railway lines. Apart from this, dropboxes are also available at domestic and international airport terminals, inside 586 societies. You can get the list of dropboxes here.

Which option is best?

If you are looking for convenience and time saving, then prefer online option with direct debit from your bank account. This way you don’t have to remember paying bills every month. However make sure your account has sufficient balance to avoid penalty.

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5 Factors Unknowingly Impacting CIBIL Score with No Credit/Loan

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Credit application is like a marksheet. In order for any college to grant you the admission, they will check your marksheet and based on the marks you will be offered a seat in the college. i.e. whether student is worth giving admission or not is dependent on his/her report card. Similar is the case when you apply for credit card or loan.

Banks want something to prove that an applicant is credit hungry or not. They cannot simply give credit to anyone. And banks do this by getting credit report from CIBIL. And the report is called as CIBIL report or Credit Information Report.

The report mainly consists of two important information:

  1. Credit usage report such as number of ongoing credit/loans, repayment history, default payment and many others.
  2. Personal details such as PAN number, residential address, etc.

Based on credit usage, bureaus then calculate a score known as credit score. You must have various articles on the factors that impact your credit score. If you want to know then read article on this link.

There are certain factors which unknowingly affect your CIBIL score even when you don’t have any ongoing credit. And these are as follows:

  1. Multiple applications: Not many of us are aware that every inquiry for loan or credit card gets reflected in the credit report. And within a short span of time, if multiple applications are made at one or multiple financial institutions, then for lenders this means applicant relies heavily on credit.
  2. Becoming guarantor: However there is one factor which can impact your credit score without you being taking the credit. That is Guarantor. Although your motive when at the time of becoming guarantor was to financially assist the applicant. But he/she can turn up defaulter in the future. In such cases, banks have legal rights to recover the money from guarantor. In addition to this, your CIBIL score also gets impacted.
  3. Banks do not update CIBIL: Make sure every bill is paid on time and fully and the same is reported to CIBIL. Although the reporting part is not in your control as it is bank’s responsibility. But it’s your duty to periodically cross check your financial transaction details (once in a year or before applying for loan or credit card) with CIBIL. As per rule, banks must update their CIBIL database within 45 days. If the same is not updated then your score will be affected.
  4. NOC & NDC on account closure: When you wish to close your card account then it is your duty to ask lender to provide no objection certificate and no dues certificate. NDC is especially very important and that too on bank’s official letter head bearing signature and designation of the authority. This legal document will act as a proof of no outstanding amount remaining. Moreover when you apply for loan or credit card at some other bank then you may be asked to furnish NOC or NDC or both. Also make sure, the status of account closure is reflected in CIBIL’s record, otherwise it will negatively impact your CIBIL score.
  5. Not using credit card: Once you get a card, you should use it diligently. But being an inactive card user will impact your credit score when the card has debt. What happens is that the card company closes your account when it is unused for a long time.
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Best Credit Cards for Movie: Offers, Free Tickets, Discounts

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India is the world’s largest movie producer. And its revenue is expected to rise to INR 150 billion in 2o16 (according to Wikipedia article named Cinema of India).

With the growth of digital technologies, movie lovers book tickets online either on website or app. And they either make use of net banking, debit or credit cards, payment wallets and others.

Taking benefit of this rise in online buying are the credit card companies who offer special discounts/free tickets/offers for their card holders. Although such cards are not specifically made for entertainment and they offer other benefits such as discounts on dining or hotel and many others.

So which are the credit cards for movie lovers? Listed below are the  top lenders in India along with their cards and offers.

Bank NameCard NameOffer
HDFC BankTitanium1) 25% off on cinema tickets.
2) Discounts upto Rs. 1, 800 or more in a year.
HDFC BankTimesCard - Titanium & Platinum25% off
ICICI BankSapphiro, Rubyx, Coral, Carbon, Signature
Jet Airways ICICI - Sapphiro, Rubyx, Coral
1) Buy 1 and get 1 free on any day of the week
2) Up to 2 free tickets per month.
Both offers only on www.bookmyshow.com
ICICI BankDiamant & Sapphiro CardUpto 2 tickets free per month
HSBCAll cards2 movie tickets for the price of one only on BookMyShow mobile app for Saturday shows.
Kotak Mahindra BankVisa Infinite or Signature2 movie tickets for the price of one on www.bookmyshow.com or it's mobile app
Kotak Mahindra BankAll cards10% off on booking movie tickets at inoxmovies.com or INOX Mobile App
IndusIndIndulge, Pinnacle, Signature, Platinum, World Miles Platinum
Jet Airways Odyssey & Voyage, World Miles Signature, Iconia - Visa & American Express
Upto 1-3 free tickets every month only on www.bookmyshow.com.
Number of free tickets varies for each card.
SBISignatureRs. 500 off every month only on www.bookmyshow.com
Axis BankMy Zone, Platinum & Titanium25% cashback on all days of the week with a limit of Rs. 1000 in a calendar year. Applicable at all cinema halls.


  1. Check with bank whether offer is still valid. As they may change time to time depending on bank’s discretion.
  2. Movie offers are also offered on debit card. So check with your bank on such offers.
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4 Ways to Get Credit Card in India: Add-On, Against FD & Others

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The demand for credit card in India is on the path of outpacing the debit card. And it has been observed that spends through this form of plastic money has also been very high compared to debit card. Few common reasons for such a trend are:

  • You get free money for a certain time. Moreover you also get an option of making minimum payment and sufficient time to pay the money back. And this is what attracts the buyers, the most.
  • The enormous growth of eCommerce where credit card is widely accepted
  • Income levels have risen, so people are spending heavily
  • Reward points, cashback offers, free miles etc.

However not everyone is lucky to get a card. Because lenders now have become very cautious when approving any credit in order to reduce the non-preforming assets for preventing the losses. And to segment such risky individuals, lenders rely on CIBIL score and their own customer database. But this doesn’t mean that once the card is disapproved, you will not get another card.

There are multiple ways to get credit card in India, as follows.

  1. Direct application: This has traditionally been the most common way used by individuals to get credit card. You just need to contact the bank and apply for the card. You can either apply online or visit bank or request bank send their customer executive. After you apply, bank will then check various parameters such as your previous repayment history, number of card accounts active etc. and then calculate your repayment capacity. Based on statistical calculations, banks will either approve/disapprove your application.
  2. Add-on or supplementary card: If you unfortunate to get credit card using direct way, then you can still get a card but on your family member’s existing card account or your own account. These are called as add-on or supplement card. However the condition is that cards will be issued to family members which includes children, mother/father, spouse. Also there is a cap on the number of cards that can be issued and the credit limit depending on the number of cards issued.
  3. Against fixed deposit: Another good option to get a credit card is, against FD. It also helps in building credit score especially for the first timers. Advantage is that eligibility criteria are not very stringent and documentation requirement is also bare minimum. Moreover lenders do not take into consideration income, repayment history, etc. However there are certain disadvantages as well such as non-repayment of dues will force bank to debit the money from your FD account. The card limit is typically 80%-85% of the FD amount. Here is the detailed information on such type of card. This linked article also contains the list of banks offering credit cards against FD.
  4. Pre-approved cards: The above listed ways of getting a card requires individuals to apply on their own. But there is a type of card, which lenders offer to selected individuals. These are called as pre-approved cards. You must have seen many E-mails in your mailbox with subject line similar to “Pre-approved Credit Cards”. Basically banks make such offers in order to win new customers. And the process they follow is by scanning CIBIL database and selecting customers having CIBIL score at an optimum level. However there is a trick here, pre-approved doesn’t guarantee that card will be received. This is because once you apply for such card, the real background verification will be conducted by the card issuer. This mainly includes income check, repayment history amongst others. And if you fail to meet their criteria, the card will be rejected which in turn might hurt your CIBIL score. So be careful while applying for the card. Opt only when your repayment record is good and you carry no debt and most importantly, the benefits of this pre-approved card are better compared to any existing owned card.

Irrespective of the way you get a credit card, it’s wise usage will make you a smart credit user. And will help you get credit especially during bad financial phase of your life.

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Credit Card Habits that Affect Credit Score

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Credit card helps in building credit score along with other benefits such as access to credit for certain time period. However what many individuals forget is that its unwise usage can lead them in trouble. With easing inflation there is a slowdown in debit card spends and more and more individuals are spending heavily through credit cards. However individuals often forget the various risks associated with negligent usage, most importantly the CIBIL score. So let’s see what types of usages will lead individual in trouble:

Transacting above or near to the card limit frequently:

Every card has a limit associated with it and based on your income and spending behavior the limit is set. While spending, if you frequently exceed the limit, then it will put you in trouble. This is because in the eyes of lender, frequent overspending means you are too much dependent on the credit i.e. poor in credit management. In addition to the hefty penalty fee, lender will increase the interest rate and/or decrease the limit. But what impacts you the most is the downgrading of your CIBIL score. However if the overcrossing happens unknowingly, then chances of your credit score getting impacted are very minimum.

Not paying the bills ontime:

“Always pay your bills on time”. This statement applies to every bill – credit card, loan, utility bills and others.
In case of utility bills, you would be just charged extra fine but when it comes to credit card, the repercussions are bigger as it negatively impacts the credit score. Frequent late payment downgrades your CIBIL rating. And this further results in rejection of any future loan or other credit applications as banks consider such individuals as risky. Moreover your interest would increase or credit card will be cancelled or limit would be slashed, amongst others.

Settling credit card bill:

When card debt reaches a level which is impossible to repay; then lenders offer an option of settling the bills. So instead of paying full amount, lender will ask you to pay a certain sum and then close the card account. This practice of credit card settlement may sound profitable to some extent but it directly affects your CIBIL score. Read tips on improving your credit score.

Increasing the card limit:

Too much reliance on card, hurts the credit score. This is because in the eyes of lender, such habit is a sign of credit hungriness. So if you frequently ask your bank to raise the credit limit then chances of your CIBIL rating getting impacted increases.

Applying at other lender when your credit card application is rejected?

Rejection of card application is very common as bank has to prevent losses arising due to payment defaults. Although you can apply to some other lender, it is advisable not to do so due to the reasons mentioned above.

But you can still apply and get credit card either through:

Add-on card
Against fixed deposit
Co-branded card

So in order to be in the good books of lender, credit card habits play a very critical role. Frequent misuse of card can create unforeseen financial trouble for you.

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