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Credit Cards: A Guide to Maximising Your Card's Potential

RBL Bank Oct 18, 2024

Credit cards have become an indispensable financial tool for millions of people in India in the 21st century. They offer unparalleled convenience, allowing consumers to make purchases easily, whether online or in-store. Beyond being just a payment method, credit cards come with a multitude of benefits, from rewards and cashback offers to travel perks and enhanced security.

However, navigating the credit card landscape can be overwhelming, especially for those new to the concept. This comprehensive guide aims to simplify credit cards, providing you with all the information you need. We will dive into their advantages, types, eligibility criteria, and the application process. By the end of this guide, you’ll be well-equipped to make informed decisions about your credit card.

Benefits You Can Avail from Your Credit Cards

  • Convenient Payment Method
    Credit cards offer unmatched convenience when it comes to payments. Gone are the days of fumbling for cash or searching for change. With a credit card, you can complete transactions swiftly and effortlessly. It is especially beneficial for online shopping where credit card payment modes are seamlessly integrated to enhance the overall shopping experience. Additionally, many credit cards come with contactless payment features, allowing you to make purchases with just a tap of your card, further speeding up the transaction process.

  • Rewards and Cashback Offers
    One of the most appealing aspects of credit cards is the opportunity to earn rewards. Many cards provide points for every transaction made, which can later be redeemed for various benefits like discounts, travel vouchers, or merchandise. Cashback offers are another lucrative feature where you receive a percentage of your spending back.
    For example: If you spend INR 20,000 in a month on a credit card that offers 5% cashback, you will receive INR 1,000 back. Over time, especially with regular expenses, these rewards can amount to significant savings.

  • Building a Credit Score
    A credit card is a powerful tool for building and improving your credit score. By using your card responsibly—making timely payments and keeping your credit utilization low—you can establish a positive credit history. This not only enhances your credit score but also makes it easier to secure loans or mortgages in the future at more favorable interest rates.

  • Travel Benefits
    For frequent travelers, credit cards often come with enticing travel benefits. These can include complimentary airport lounge access, travel insurance, and discounts on flight bookings. Some cards even offer miles for every rupee spent, which can be redeemed for free flights or hotel stays.

  • Purchase Protection
    Many credit cards provide purchase protection features that safeguard your transactions. This may include extended warranties on products, protection against theft or damage, and even price drop protection. Such features provide peace of mind to the user when making significant purchases.

Types of Credit Cards

  • Cashback Credit Cards
    Cashback credit cards reward users with a percentage of their spending returned in the form of cash. These cards are ideal for everyday purchases, allowing users to earn back a portion of what they spent on groceries, fuel, and dining.
  • Rewards Credit Cards
    Rewards credit cards accumulate points for every transaction. These points can be redeemed while spending on travel, or shopping among other things. They are perfect for those who enjoy collecting points and making the most out of their spending.
  • Travel Credit Cards
    Travel credit cards cater specifically to travelers, offering perks like air miles, lounge access, and discounts on travel-related expenses. They are excellent for those who frequently fly or stay in hotels, making their travel more rewarding.
  • Secured Credit Cards
    Secured credit cards require users to make a deposit that serves as collateral. They are ideal for individuals looking to build or rebuild their credit score, as they typically have lower credit limits but help in re-establishing a positive credit history.
  • Balance Transfer Credit Cards
    These cards are designed to help users transfer existing credit card debt to a new card with a lower interest rate. This can save money on interest payments and help pay off debts faster.

Comparison Table of Features and Benefits

Type of Card Key Features Ideal For
Cashback Credit Cards Earn cash back on purchases Everyday spenders
Rewards Credit Cards Earn points redeemable for rewards Reward seekers
Travel Credit Cards Travel perks, miles, lounge access Frequent travelers
Secured Credit Cards Low credit limit, collateral required Rebuilding credit
Balance Transfer Cards Lower interest rates on transferred debt Debt consolidation

Eligibility Criteria

  • Age Criteria: Most banks in India require an applicant to be at least 21 years old to apply for a credit card. Some issuers may offer cards, particularly secured credit cards, to individuals as young as 18 years of age.
  • Employment Status: Many banks require applicants to be employed or self-employed. A stable income as a proof of employment or business ownership is crucial for credit card eligibility. Different cards may have varying income requirements, typically starting from INR 20,000 per month for entry-level cards and increasing for premium options.
  • Credit Score Requirements: A good credit score (typically above 750) is essential for qualifying for most credit cards. A higher score increases your chances of approval and may also provide access to cards with better rewards and lower interest rates.
  • Resident/Non-Resident Eligibility: Eligibility can also depend on residency status. While Indian citizens have no issues applying, non-residents may face stricter criteria, and certain banks may only offer limited options.

Documents Required

  • ID Proof: To apply for a credit card, you will need valid ID proof. This can include a PAN card or Aadhaar card, which helps verify your identity.
  • Address Proof: will also need to provide a proof of your residence. Acceptable documents include a passport, utility bills, or bank statements, all dated within the last three months.
  • Income Proof: To assess your repayment capacity, banks require income proof. This includes recent salary slips, bank statements, or Income Tax Returns (ITR).
  • Photo: A recent passport-sized photograph is required as part of the application process.

How to Apply for a Credit Card Online

Step-by-Step Guide

  • Choose the Right Card: Research different credit cards offered by different banks and select one that aligns with your spending habits and financial goals.

  • Visit the Bank's Website: Go to the official website of the bank or financial institution offering the card you wish to apply for.

  • Fill Out the Application Form: Complete the online application form with your personal, financial, and employment details.

  • Upload Required Documents: Scan and upload the necessary documents such as ID proof, address proof, income proof, and your photo.

  • Review and Submit: Double-check your application for accuracy and submit it.

Online Application Process

Once submitted, your application will be reviewed by the bank. Most banks provide an online tracking system so you can monitor the status of your application. Approval typically takes anywhere from a few hours to several days.

Activation Process

Upon approval, your credit card will be sent to your registered address. To activate your card, follow the instructions provided by the bank, which usually involves calling a designated number or using the bank’s mobile app.

Compare Credit Cards

Comparison Table of Top Credit Cards of RBL Bank

 
Card Name Type Annual Fee Key Benefits
Shoprite Credit Card Cashback INR 500 Earn 20 reward points for every INR 100 each time you use your card for grocery shopping.
Get a 10% discount (up to INR 100) on movie tickets on BookMyShow 15 times a year.
2000 rewards point as welcome gift.
Platinum Maxima Plus Rewards INR 2,500 Complimentary lounge access.
One Free movie tickets.
10,000 Rewards points as welcome gift.
World Safari Credit Card Travel INR 3,000 INR 3,000 Make My Trip Voucher.
0 markup fees on International Transactions.
2 complimentary domestic Lounge access and Priority Pass.
5 rewards points on EVERY INR 100 spent on domestic travel.
Cookies Credit Card Rewards INR 100 p.m. 10% instant discount at BookMyShow up to INR 300 per month.
INR 1,000 gift voucher choose from Chrome, Myntra, Amazon, Flipkart, and Shoppers Stop.
10% cashback at Myntra, Zomato, Uber up to INR 300 per category per month.
Icon Credit Card Lifestyle INR 5,000 20,000 Rewards Points as welcome gift.
1+1 Movie ticket up to INR 200 twice a month.
20 reward points on International spends and Dining spend on weekends.

Features, Benefits, and Fees of Each Card

  • Shoprite Credit Card: Perfect for daily essentials, the Shoprite Credit Card offers unlimited cashback on all transactions, with a low annual fee of INR 500, making it ideal for everyday spenders.
  • Platinum Maxima Plus: Luxury rewards without the hefty price tag! Platinum Maxima Plus offers unlimited points on every spend, with a reasonable annual fee of INR 2,500, perfect for frequent spenders.
  • World Safari Credit Card: World Safari Credit Card offers unlimited rewards on international spends, with a competitive annual fee of INR 3,000, ensuring minimal cost for frequent travelers.
  • Cookies Credit Card: Affordable rewards for daily spends. Cookies Credit Card offers unlimited cashback, with a low monthly fee of INR 100, making it ideal for everyday spenders seeking maximum value.
  • Icon Credit Card: High-end rewards without the high cost! Icon Credit Card offers unlimited rewards on international dining spends, with a fixed annual fee of INR 5,000, perfect for those seeking luxury benefits.

Ratings and Reviews

Before applying, it’s wise to read user reviews and check online ratings. This can provide insights into customer satisfaction and any potential issues with a particular card.

Conclusion

Applying for a credit card is a great step towards achieving financial flexibility. With various types of credit cards available, it's essential to assess your financial habits and choose a card that meets your needs. By understanding the benefits, eligibility criteria, and application process, you can make an informed decision that will serve you well in the long run. Remember to use your credit card responsibly to maximize its advantages while building a strong credit score for future financial needs.

With this comprehensive guide, you are now better prepared to navigate the world of credit cards in India. Happy spending!

Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.

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