A credit card is a financial tool that offers a convenient way to borrow funds up to a certain limit. The limit of credit cards is determined by the issuing bank or financial institution and may be increased based on your credit score. With a credit card in hand, you can access funds whenever you need them, and enjoy the freedom to make purchases with confidence.
When you have a successful banking transaction, you automatically become eligible for a higher credit card limit. Additionally, the borrowed amount is deducted from your bank account on the monthly agreed payment date.
Thus any customer can utilize this amount for any purpose and get it returned before the due date fixed by the Bank. As per the guidelines of Reserve Bank of India, any individual who has met these criteria is eligible to avail a card as follows.
Who can Avail or How to Get Credit card?
- Applicant should have crossed 18 years of age
- Salaried or self-employee with proof of ITR filing
- Having a Saving Account in any Bank
- Should have a valid Indian Address
- Have met the requirements of card issue in terms of income
How to use a Credit card?
Avail Interest free credit from respective banks for over 50 days and get it repaid under this grace period to avoid any interest on the amount. These are some points that need to be considered while using a Credit card.
- Using Grace Period Perfectly: The grace period includes 30 days of billing cycle with 15 to 20 days from date of statement generation. Making an expense after billing will let you avail 50 days of interest free credit balance.
- Shop Online to Earn Reward Points: Every card does offer 2x reward points during online shopping, thus making use of it to correctly increase your reward balance.
- Convert your Spends to EMI: If you have purchased an item by using full balance and thus seems difficult to reply to it, then customers can avail EMI facility to repay and utilize the amount through regular monthly installments.
How Does a Credit Card Work?
Using Credit card for any transactions means payment being made by Bank on your behalf, and make any number of transactions using cards under the approved limit and get a summarized statement of your total transactions.
Thus by looking at the statement you can make the due amount to be paid as well as the exact date for payment, and Statement Includes Available credit and cash limit, Minimum Amount Due, Total Amount due, Interest Charges, Payments done and due date for payment.
Types of Credit card
There are multiple cards available out there which are issued by various Banks and Financial institutions, thus this list of cards should be opted wisely as per your usage.
| Card Type | Features of Credit Card |
|---|---|
| Travel card | If you travel a lot and do many transactions during your travel then having a Travel card will benefit in many ways. This also gets you booking discount in Hotels, Flights and in more ways. |
| Fuel Card | Get your transport cost in limit by using Fuel Credit card which allows you to get benefited by its regular usage. This gives extra reward points then, and while used in Fuel Pumps and which can be later utilized as savings. |
| Shopping card | This type of card comes with an it’s of shopping partners, thus having any shopping form their listed partner will make your discount and get vouchers. |
| Secured card | This is a unique type of card which is offered based on your Fixed deposits. Thus they avail interest on your amount saved and will help your score. |
Different Types of Credit Card Payment
Making payment is easier if you have got your card in your hand, Thus Credit card payment of any bank is accepted by making payment from any payment mode listed here.
You need to pay the amount before the due date by visiting the respective bank or using any electronic mode of online payment, These are the few modes of payments accepted by any Credit card for payment due.
- Payment from BILL Desk
- Payment from NEFT
- Payment from Net Banking
- Payment from NACH facility
- Payment from Cheque
How does a Credit card differ from a Debit card?
The money drawn using Debit cards is your savings from your Own associated account balance. On the other hand, money drawn using a Credit card is the credit balance provided by the Bank based on your eligibility for a limited time period.
What is a co-branded Credit card?
Any card which has got a merchant logo or name as a part of promotion is termed as Credit card, and thus merchants like Airlines, Hotels, Online Shopping websites do contribute for co-branded cards with exclusive offers.
What is a CVV Number on a Credit card?
The card verification value is a 3-digit number which is present at the other side of the card, and thus CVV number is essential for any online transaction as a combination of your card number and CVV does make any transaction successful.
Lost my Credit card, what should I do?
If you have lost your card by any means, the foremost thing is to contact customer service to raise a request to block card, and also should request to re-issue the card as it is stolen or lost.
How to Use my Credit card Reward Points?
If you have got enough reward points from your card, then you can visit the Reward point website and redeem your points from there, and also you can generate Voucher for any online shopping site using the reward points collected.
What if i delay in Credit card Payment?
As per the guidelines laid down by the Reserve Bank of India, any bank that issues a credit card has the authority to introduce interest charges as per their running rate of credit issued. Therefore, in case of delay or non-payment, the interest will accumulate on the total amount due and get added to your next scheduled payment, without fail.