Credit cards are financial instruments of great utility. They allow you to purchase goods or avail a service without having to pay for it instantly. The credit card issuing entity pays on your behalf when you swipe the card. Once you receive the credit statement at the end of the billing cycle, you need to pay back the total amount before the due date. Thus, credit cards come in handy when there is a dire need of funds. In India, banks offer many types of credit cards.
The eligibility criteria, advantages, credit limit etc. of these variants differ based on the issuer. Basic credit cards do not extend benefits like access to airport lounges, but they do not demand a hefty income either. And they usually provide eye-catching offers like waivers on fuel surcharge, discounts on movie tickets or waiving joining fee or the annual fee. Similarly, premium variants are reserved for those earning a generous amount. Some variants offer rewards and cashback on every purchase made.
In this article, we have tried to place credit cards under distinct headings and have briefly described each of the types. Read on to have a fair idea of your options to get the best credit cards in India.
Credit cards based on hierarchy
We can segregate credit cards into different types based on their credit limit, perks and benefits and their functionality, among others.
- Secured credit cards: Secured credit cards are issued against a fixed security deposit. It is a facility in place for new entrants in the financial world or those with a poor credit history. To get hold of a credit card, you need to have a decent credit score. Banks usually ask for a credit score of 750 or above before approving the application. If you do not meet the eligibility requirement, you can apply for a secured credit card. The credit limit set on these cards is a certain percentage of the fixed deposit amount, and it varies from bank to bank. These credit cards do not offer many perks and benefits. Once you earn the bank’s trust by paying the bills on time, the secured credit card can be upgraded to a regular one.
- Regular credit cards: A regular credit card can be your ideal first credit card. Neither the income eligibility nor the credit limit is set too high. Usually, banks charge a minimal interest rate on them. And they come with negligible or zero annual renewal fees. Some basic perks, such as waivers on fuel surcharge, reward points etc. are available on regular credit cards.
- Silver credit cards: Silver variants belong to the lower rungs of premium credit cards. They are issued to salaried employees with a significantly high annual income. Stellar credit history is also a non-negotiable benchmark. The benefits of holding a Silver credit card are numerous and these cannot be availed with a regular credit card. However, it still falls short of the perks offered by the Gold counterparts.
- Gold credit cards: Gold credit cards offer myriad benefits to cardholders. For instance, the credit card limit is set high. And therefore, you can purchase high-end products on credit with no hassle. Gold credit cards allow you to lead a luxurious lifestyle. Access to airport lounges, golf courses etc. are some benefits you get to savour.
Credit cards based on the target audience/ownership
Credit cards are also specifically designed for a specific section of the audience. These include:
- Student credit cards: Student credit cards in India are a recent introduction. Students who have attained 18 years of age can apply for them. And they are generally valid for five years. If you are a student who fulfils the age criterion, you will not have to show any income statement or proof.
- Corporate/Business credit cards: Corporate and business credit cards are often used interchangeably. However, there is a slight difference in their functions, utilities, liabilities and perks. Business credit cards are issued to small businesses and entrepreneurs. When the company’s revenue exceeds a certain fixed amount, it becomes eligible for a corporate credit card. These credit cards help in separating personal and business expenditures. Employers can issue them to their company’s employees to pay for work-related expenses. Corporate credit cards come equipped with added advantages, such as seamless accounting, expenditure analysis, 24/7 Management Information System etc.
Credit cards based on types of benefits in different domains
- Travel credit cards: If you are a frequent traveller, you can get hold of a travel credit card. They offer benefits such as travel insurance, discounts on train/flight tickets and free access to airport lounges, among others.
- Entertainment credit cards: These credit cards are meant for those who spend a lot on entertainment-related expenses like movie tickets, concerts etc.
- Fuel credit cards: These credit cards offer a high discount, rewards and cashback on fuel surcharges.
- Rewards credit cards: Rewards credit cards offer a variety of bonuses or rewards for every rupee that you spend. These rewards are defined by the bank and can be in the form of redeemable points, gifts or vouchers.
- Cashback credit cards: If you hold a cashback credit card, you are guaranteed to get back some money on every purchase. These credit cards play a prominent role in helping the cardholder save on a variety of transactions.
Credit cards can thus be grouped under several headings. With every single day, they are becoming more inclusive. For instance, even students with practically no income can apply for a student credit card. If you are also keen on applying for a credit card, you must be enlightened of your requirements, eligibility criteria and perks associated with different credit cards.
When we talk about the best credit cards in India, the Bajaj Finserv RBL Bank SuperCard takes the pole position. It is a one-of-a-kind credit card, packing the features of four different cards in one– namely credit, EMI, debit and a loan card. You must be an Indian citizen, have a regular source of income and possess a credit score of 750 or above to be eligible for the Bajaj Finserv RBL Bank SuperCard.