Overview

Credit cards are a convenient alternative to cash for making transactions both online and offline. There are two big advantages with credit cards. First, you can continue to make purchases through them, even if you do not have adequate funds in your bank account. Provided you keep paying your credit card bill in full and by the due date, your credit card transactions come at zero extra cost. The second advantage is the benefits credit cards offer in the form of rewards, cashbacks etc.

To make the most of a credit card, you need to first have the right card suiting your spend pattern, lifestyle and needs. At servzone.in, we help you know everything about the best credit cards available in the market from India’s top banks and the one you should choose.

Top 10 Credit Cards Comparison

RBI issues new guidelines for credit cards and debit cards-1 October 2020

In a bid to make debit card and credit card usage more secure, RBI has announced some new guidelines that will be effective from 1st October 2020. These guidelines mainly focus on international, contactless and online transactions on cards. Below are the new measures:

1. From 1st October 2020, all new/re-issued cards will be enabled only for ATMs and POS transactions. Cardholders will have to enable online, contactless and international transactions on their cards before making such transactions for the first time
2. Customers will have to request their card providers to enable international transactions. Till now, international transaction was enabled by default on all cards
3. Credit card issuers may now decide whether to disable the card not present (domestic and international) transactions, card present (international) transactions and contactless transaction rights based on the risk perceptions. This decision will be made for existing users only
4. Online and contactless payments will be disabled on all cards that have never been used for the said purpose
5. People can now opt-in or out of certain services, set spend limits for online, international and contactless transactions.
6. Customers can switch on/off or change transaction limits via any channel which includes mobile application, internet banking, ATMs, Interactive Voice Response (IVR)
7. Cardholders now have the option to enable or disable the contactless payment feature on their credit cards
8. People can now set transaction limit on their credit card

SBI Card Restructures Dues and Offers Loan Options to Cardholders, Post Moratorium-12 September 2020

Following Reserve Bank of India’s guidelines, SBI Card offers loan restructuring facility to its cardholders via the ‘Easy Pay’ option. This facility is provided only to the cardholders who availed the moratorium period. Customers who enrol in the scheme will find their interest lowered by 70% or more. Also, SBI Card has said that if the Supreme Court asks banks to provide interest relief for the moratorium period, then it will adjust the amount in subsequent payments.

Federal Bank will launch an independent credit card within a year- 16th Aug 2020

Federal Bank, which is currently offering credit cards in partnership with SBI Card, is going to launch independent credit card within a year. The bank has collaborated with Fiserv, a global provider of financial services technology, to support this card launch. The payment network for the cards (Visa, Mastercard or Rupay) will be announced in a month. Federal Bank has an existing customer base of our 1 Crore and will focus on extending its independent credit card offerings to them.

SBM Bank launches a co-branded RuPay credit card for small businesses- 23rd July 2020

State Bank of Mauritius, in association with EnKash and YAP fintech firms, has launched a corporate credit card on the RuPay Network. The card is called SBM EnKash RuPay Business Card. It provides unique benefits for corporates such as expense tracking, 30-day credit period on business purchases, bill payments, travel expenses, and so on. SMEs, MSMEs or startups can apply for this card digitally at any SBM Bank touch point.

One Card to Launch Metal Credit Card in India- 9th Jan 2020

One Card, in association with Visa, will soon be launching a credit card with a plan to disrupt the Indian credit card market. The card will come with a powerful mobile app which will let users control every aspect of their card including credit limit, rewards, international usage and more. On top of it all, the card has a metal base to lend it a premium look and feel.

SBI Card Launches Travel Credit Cards in Collaboration with Vistara Airlines- 26th Nov 2019

SBI Card has launched two new cards- Club Vistara SBI Card PRIME and Club Vistara SBI Card, in association with Vistara Airline. The cards will offer complimentary membership to Club Vistara, Premium Economy class flight tickets and many more travel benefits. Cardholders will also earn extra Club Vistara points on Vistara Airlines transactions which can later be used for booking flights with Vistara Airlines and other partner airlines. Speaking with a news website, Vistara’s CEO said that they wish to enhance the value proposition of Club Vistara from just a loyalty program to a comprehensive lifestyle program.

No more discounts on fuel stations for credit card users

The oil companies, Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd. have decided to roll back the 0.75% discount that was being offered to credit card users. The discount will not be given to customers from 1st October 2019. However, the discounts on debit cards and other digital modes of payment still stand and can be availed by users.

HDFC Bank in collaboration with Indian Oil Corporation launches a new credit card

HDFC Bank in association with Indian Oil Corporation has launched a new credit card on 25th September 2019. The card offers fuel surcharge waiver, up to Rs. 250 per statement cycle on transactions over Rs. 400. It also offers reward points in the form of Fuel Points. The fuel points can be redeemed against petrol or diesel. Customers can get up to 50 liters of fuel annually. The card can be used at any of the IOC petrol pumps.

Free charge launches ‘Digital Credit Card’ with Axis Bank- 28th August 2019

In a step to extend its reach to the millennials, Free charge has launched a digital credit card with Axis Bank. This card is targeted at the youth who would be at the beginning of their career and are in need of credit. Customers will be able to get convenient and instant access to credit through this card.

JCB Launches Credit Cards in India in collaboration with NPCI- 19th August 2019

National Payment Corporation of India (NPCI) and JCB International have collaborated to launch credit cards in India. The RuPay JCB Global Credit Card will be issued by eight banks in India. The partnership between the companies was established back in 2015. In its first phase, Indian merchants were enabled to accept foreign JCB credit cards. And now in the second phase, it would enable Indian users to make payments in foreign countries using their RuPay JCB Global Credit Card. Users will also be able to enjoy a special cashback program when they make payments at selected destinations.

Credit Card Usage in India Grows 27% Owing to the Digital Push- 8th Aug 2019

India, which was primarily a debit card market, is gradually shifting its focus towards digital payments and credit cards. As per recent data published by RBI, credit card usage in India has grown by 27%. The number of credit cards in circulation has reached 48.9 million in May 2019 as opposed to 38.6 million in May 2018. The total transaction value on credit cards has gone up from 4.6 Lakh Crore in 2017-18 to 6 Lakh Crore in 2018-19. This paves the way for growth in digital payments as well as the number of retail borrowers in the economy.

SBI Card launches a new credit card in collaboration with Ola- 15th May 2019

Ola Cabs and SBI card have joined hands to launch Ola Money SBI Card. Powered by Visa, the credit card will bring further convenience to Ola users. This card is available at zero joining fee and would offer cashback instantly into the customer’s Ola Money Account. Moreover, users will be able to view, apply, and manage their credit card directly from the Ola app.

Paytm launches a credit card in association with Citibank- 15th May 2019

The Indian e-commerce giant Paytm, in collaboration with Citibank, has launched the Paytm First Card. The card will offer minimum 1% universal cash back on all transactions that will automatically be credited to user’s account every month. The annual fee of this card is Rs. 500 which will be waived if users spend Rs. 50,000 in a year.

ICICI Bank in association with Goibibo launches a multi-currency credit card- 13th May 2019

ICICI Bank has launched a multi-currency credit card in association with Goibibo travel portal. The card allows user to instantly transfer money from one currency to another. Users can use up to 15 currencies simultaneously with this card. Along with welcome benefits of up to Rs. 20,000 users also get 15% discount at over 100 restaurants across 6 foreign cities. Cardholders also get insurance between Rs. 2 lakh and Rs. 10 lakh.

ICICI Bank Launches Emeralde- a Super-Premium Credit Card- 28th Feb 2019

ICICI Bank is counted among the largest credit card providers in India. The bank has recently launched ICICI Bank Emeralde Credit Card- a super-premium card targeted at people who have a monthly salary of ₹ 3 Lakh and above. The card offers unlimited complimentary international and domestic lounge access and exclusive discounts at VLCC, Kaya Skin Clinic, Gold’s Gym, Richfeel and True Fitt n Hill. The rewards are offered in collaboration with PAYBACK. Lowest foreign currency markup fee of 1.5% makes it a great card for international travels. The Emeralde Card is offered in two variants- Mastercard and American Express.

Some facts

• Do all credit cards feature an annual fee and joining fee?

No, not all cards attract an annual fee and/or a joining fee. In the case of basic credit cards, there is usually no annual fee; however, cards that have an annual fee often provide more benefits than the zero annual fee cards.

• Can I get cash from the ATM using my credit card?

This facility is known as a cash advance. You can withdraw a part of your total credit limit as cash from an ATM. But such cash withdrawals carry additional charges and feature a higher interest rate than your card-based purchases

• How to earn and use credit card reward points?

Every time you use your credit card, you earn some reward points. Accumulated reward points can be redeemed against gift vouchers, merchandise or a direct statement credit. The rate of rewards differs from one card to another and also based on spending. For example, some cards may offer extra rewards on grocery spend while another card may give you more rewards when you book flight tickets or hotels.

Some cards offer cashback instead of reward points. These are credited directly into your credit card account, unlike reward points that have to be redeemed. Some of the best cashback cards in India HDFC MoneyBack Citibank Cashback IndusInd Pinnacle Standard Chartered Manhattan Platinum.

• Can my credit limit increase later on?

Credit limits are revised from time to time by the card issuer. This usually takes into account your previous payment track record; however, your limit may also be downgraded if you have missed multiple payments on previous bills.

• Does credit cards charge interest rate for non-payment?

The interest rate is applied on any balance you owe on your card. Credit card interest rates are the highest among various debt instruments available to the customer. In most cases, interest rates start at 18% and may go up to 45% annually based on various factors such as the type of card, card issuer policies and various other factors.

You can check the details of credit card interest rates charged by different lenders here.

• What is a secured credit card?

A secured credit card is one that is issued against an asset say Fixed Deposit. It can be a good beginning for those who are not eligible to get a normal (unsecured) card. Leading banks like SBI and HDFC offer secured cards against fixed deposits.

• What is the difference between rewards and cashback?

Rewards can be earned in the form of points that can later be redeemed against gift vouchers or statement credit whereas cashback comes directly into your card account. Most of the cards offer rewards and only a few provide cashback facilities.

• Can I convert my credit card purchases into EMIs?

Yes, you can convert your big-ticket purchases in easy EMIs as per the applicable EMI options available with your credit card. The interest rate on credit card EMIs varies from lender to lender, thus it is better to check the interest rate beforehand. Also, some lenders in collaboration with big brands and online stores offer discounted or no interest EMIs for their customers. You can check EMI options on your credit card using your net banking/credit card app or call bank customer care for more information.

• How to upgrade to a new credit card?

Mostly people upgrade to a new credit card when either they have low credit limit or they are not satisfied with the features offered with their existing credit card. In both the cases getting a new credit card is the most feasible option You can either apply for a new credit card through bank or look for upgrade option on your existing credit card. You can also compare credit cards at servzone.in and then select the one that best suits your requirement.

However, you should be considering the below mentioned factors before moving on to a new credit card:

• Increased Credit Limit: This will not only increase your spending limit but will also help in improving your credit utilization ratio.

   

• Spend Based Benefits: if you already have a credit card that has offers on fuel then no point having another one with same features. Look for cards that offer other benefits like travel, cashbacks, dining, movies, etc. depending on your spending habits.

   

• Credit Score: Having multiple credit cards will divide your spend between them thus bringing your credit utilization on a single card down. If you keep the utilization ratio below 40% for all your credit cards your credit score will improve.

   

• Card Fees & Charges: Getting a new credit card will also increase the burden of paying annual fees for the same. Also, the penalties on your new card will be revised depending on its annual fees. Thus, always consider the annual fees along with other charges before applying for a new credit card.

   

• What is a premium credit card?

Premium credit cards offer extra benefits on lifestyle, travel, entertainment, dining, etc. and they also charge a substantial annual fee. International airport lounge access, concierge service, air accident insurance are some premium card features.

• What is the credit card balance transfer?

Some credit cards offer the facility of transferring outstanding balances on other cards, consolidate the debt and pay back in EMIs. Banks also offer low introductory offers to encourage users to transfer balances from other cards.

• Are co-branded credit cards available in India?

A number of banks have collaborated with different brands to offer co-branded credit cards in India Air India SBI Signature Card Axis Bank Vistara Amazon Pay Credit Card by ICICI Bank are some co-branded credit cards in India.

• What are milestone benefits on credit cards?

Banks offer cardholders bonus rewards or shopping vouchers on reaching a particular spending limit within a specific period. This is termed as a milestone benefit.

• My Credit Report does not show information on my new credit card. Why?

Usually, it takes up to three months for a new loan or credit card to reflect on your credit report. If it does not reflect even after three months, you should contact either your bank or the credit bureau.

• What is a lost card liability cover?

This is a zero liability benefit offered on most of the cards under which the card user will not be liable to pay any amount against the expenses occurred during the period between card loss and the user informing the bank. Some banks also offer credit card protection plan that offers additional security cover to your credit card in case of card loss or theft.

• Do credit cards come with specific cash withdrawal limits?

Yes. The cash withdrawal/advance limit on your card is pre-set and communicated at the time of credit card approval.

• How to read a credit card statement?

The main components of a credit card statement are statement date, payment due date, total amount due and minimum amount due. These are mentioned usually at the start of the statement. The second part contains detailed information about transactions.

• What is the minimum amount due?

If you cannot pay the entire outstanding amount, the bank gives you the option of paying a minimum amount after which you will not have to pay any late fee. However, interest will be charged on the remaining balance.

• How can I pay my credit card bill?

There are various ways to pay your bills such as net banking, mobile banking, bill desk, NEFT, cheque, etc. Alternately, you can also walk into the nearest bank branch and make an upfront payment over the counter. However, cash payment attracts a certain fee.

• What does credit limit mean?

The credit limit is the total amount sanctioned by the bank on your credit card. This is the maximum amount you can use on your card. The bank decides the credit limit on the basis of your credit score, income and maximum limit on your existing credit cards. You can request a limit enhancement after a few years of usage but the approval of it will be at the bank’s discretion.

• What is the difference between a credit card and a debit card?

The basic difference between a credit card and a debit card is that debit card is connected to your savings or current account whereas credit card is a type of loan taken from the bank. In case of a debit card, the amount is directly deducted from the connected savings/current account and there are no interest charges on its usage. However, in the case of a credit card, the amount is deducted from your credit limit.

• Do credit cards offer protection against fraud?

Credit cards are secured with chip and PIN, thus reducing the chances of fraud. Every time you make an online payment, you receive an OTP on the registered mobile number which you can use to authenticate the transaction. Most of the credit cards come with zero lost card liability cover which means if your card is lost or stolen and you inform the bank immediately, the card will be blocked. This way, the cardholder has limited liability in case of such fraud.

• What is the credit utilization ratio?

This is the ratio of your card usage to the total credit limit on your credit card. For example, if the total credit limit is ₹ 1 Lakh and you have used ₹ 30,000 out of it; your credit utilization ratio will be 30%. You should always try and maintain the ideal credit utilization ratio of 30% on all your cards.

Importance of Credit Card

Apart from offering the ease of use, it is essential to have a credit card for the following reasons:

• Helps in building a good credit score
• Interest free credit period of up to 45 days
• Hassle free transactions both online and offline
• Comes with excellent rewards, cashbacks, discounts, offers, etc.
• Handy in emergency financial situations
• To make big ticket purchases and pay later in easy EMIs
• All transactions are secure as they need OTP & PIN authentication

Benefits

Cardholders can enjoy the following benefits that come with their credit card-

• Welcome Offers: Most credit cards these days come with welcome benefits in the form of gift vouchers, discounts or bonus rewards points.

   

• Reward Points or Cash Back: Every time you make a purchase on your card, you receive reward points, air miles or direct cashback credited to your account. The accumulated reward points can be redeemed to avail gifts and merchandise whereas cashback is directly applied to your card account. Air miles can be used to book flight tickets at the discounted rates.

   

• Fuel Surcharge Waiver: Almost all the cards come with this benefit under which whenever you refill your vehicle, the surcharge will be waived off provided that you spend a certain amount.

   

• Airport Lounge Access: Some credit cards also offer a certain number of complimentary lounge visits in a year at domestic airports and international airports. Travel-centric cards and premium cards especially offer these benefits.

   

• Insurance: Credit cards also offer insurance and cover accidents up to a certain amount. It may be an air accident coverage, lost card liability cover or an overseas hospitalization cover.

   

• Cash Advance: You can also withdraw cash directly from an ATM using your credit card. This is quite beneficial in times of emergency when you need some urgent cash.

   

  Types of Credit Cards

  There are many types of Credit Card

  • Shopping
  • Travel
  • Fuel
  • Rewards
  • Entertainment
  • Zero Annual Fee
  • Premium
  • Co-Branded Cards
  • Secured

  Best Shopping Credit Cards

  Card Name	Annual Fee	Key Feature
  SBI Simply CLICK Credit Card	Rs. 499	10X reward points on online spends with Amazon, Ola, Bookmyshow, Cleartrip and more
  HDFC Moneyback Credit Card	Rs. 500	2 reward points for every Rs. 150 spent and 2X reward points on online spends
  ICICI Bank Amazon Pay Credit Card	NIL	Amazon Prime users can avail 5% cashback on all transactions at Amazon.in
  Flipkart Axis Bank Credit Card	Rs. 500	5% cashback on Flipkart, Myntra and 2GUD without maximum monthly cap
  American Express SmartEarn Credit Card	Rs. 495	10X Reward Points on every Rs. 50 spent at Flipkart and Uber

  Best Travel Credit Cards

  Card Name	Annual Fee	Key Feature
  Axis Vistara Signature Credit Card	Rs. 3000	4 Club Vistara points on every Rs.200 spent along with 3000 Club Vistara on spending Rs.75000
  Standard Chartered Emirates World Credit Card	Rs. 3000	6 Skyward Miles for every Rs. 150 spent on Emirates and 5% cashback on duty-free shopping
  RBL World Safari Credit Card	Rs. 3000	Earn 2 reward points on every Rs.150 spent and 0% forex markup fee
  Citi Premier Miles Credit Card	Rs. 5000	Get 10,000 air miles on spending Rs.1,000 or more in the first 60 days of card issuance
  American Express Platinum Travel Credit Card	Rs. 3500	Travel benefits worth Rs. 11,800 on spending Rs. 4 Lakh in a year

  Best Fuel Credit Cards

  Card Name	Annual Fee	Key Feature
  Indian Oil Citi Platinum Credit Card	Rs. 1000	4 Turbo Points per Rs. 150 spent at IndianOil Outlets
  BPCL SBI Card Credit Card	Rs. 499	13X rewards on fuel purchases at BPCL petrol pumps
  Standard Chartered Super Value Titanium Credit Card	Rs. 750	5% cashback on fuel, telephone bill and utility bill payment
  HDFC Indian Oil Credit Card	Rs. 500	5% Fuel Points at Indian Oil Outlets and 1% fuel surcharge waiver
  RBL Platinum Delight Credit Card	Rs. 1000	2 reward points per Rs. 100 spent & Fuel surcharge waiver at all petrol pumps

  Best Rewards Credit Cards

  Card Name	Annual Fee	Key Feature
  HDFC Moneyback Credit Card	Rs. 500	2 Reward Points per Rs. 150
  Citibank Rewards Credit Card	Rs. 1000	1 Reward Point per Rs. 125
  American Express Membership Rewards Credit Card	Nil	1 Membership Reward Point for every Rs. 50 spent on the card
  HSBC SmartValue Credit Card	Rs.499	1 Reward Point for every Rs.100 spent and 3x reward points on online and dining spends
  Standard Chartered Platinum Rewards Credit Card	Rs.250	5 Reward Points on every Rs.150 spent on hotel, dining and fuel

  Best Entertainment Credit Cards

  Card Name	Annual Fee	Key Feature
  ICICI Bank Platinum Credit Card	Rs.99	Buy One Get One offer on BookMyShow
  Standard Chartered Manhattan Platinum Credit Card	Rs.999	Rs. 2,000 BookMyShow voucher as welcome gift
  Kotak PVR Platinum Credit Card	Rs.999	Up to 24 free PVR movie tickets in a month
  IndusInd Bank Nexxt Credit Card	Rs.3,499	Up to 2 Free Movie Tickets per month under 'Buy One Get One Offer' on BookMyShow
  RBL Bank Movies and More Credit Card	Rs.1,000	BookMyShow benefits- 2 free movie tickets and 10% discount

  Best Zero Annual Fee Credit Cards

  Card Name	Annual Fee	Key Feature
  HSBC Platinum Credit Card	Nil	Buy 1 Ticket Get 1 Free on BookMyShow
  ICICI Amazon Pay Credit Card	Nil	5% cashback for Amazon Prime users on using Amazon
  Kotak Fortune Gold Credit Card	Nil	On spending Rs.1,50,000 in a year, you get 4 free PVR movie tickets or cashback of Rs.750
  ICICI Platinum Chip Card – Visa Credit Card	Nil	Minimum 15% savings on dining at partner restaurants
  Axis Insta Easy Credit Card	Nil	Get 100% cash withdrawal facility

  Application Process

  Due to the rising demand for credit cards in the market, banks and financial institutions have made the application process quite easy for the customers. You can apply for credit cards both online and offline.

• Apply Online

Nowadays, it is easy to avail a credit card if you meet the eligibility criteria. You do not need to visit your bank branch for the purpose; instead, you can apply for a credit card online-

• You can visit the web portal of the bank and apply for a credit card by filling out some basic details like name, email ID, contact number, income, address, etc.
• You will get a call from a representative of the bank who will guide you through the process.
• A representative will also come to collect your documents at your doorstep.

• Apply Offline

People who are not comfortable with online methods of application can visit the bank branch directly to apply for the same.-

• Just visit the branch and communicate about the type of credit card you need.
• The representative will tell you about the cards that match your needs.
• Then, you will have to fill the application form and provide some KYC documents such as identity proof, address proof, etc.
• You will also be required to provide proof of income and two passport-sized photographs.

Approval Process

Once the customer fills in the basic details for their credit card application all the relevant card results will be displayed on the basis of the customer’s chances of getting his credit card application approved by the provider.

Basis this data the relevant credit card results will be displayed with the Chance of Approval being any of the following, Excellent, Good, Fair, Poor against each credit card.

This will help you apply for the best and most-suited credit card you are eligible for.

Eligibility Criteria

The eligibility for a card differs from provider to provider. However, the basic criteria are as follows:

• You should be at least 18 years old.
• Whether salaried or self-employed, you must have a regular source of income to pay back your bills (minimum income bracket differs from one card to another).
• You should have a good credit score (Preferably 700 and above)

Required Documents

The documentation requirement also varies from issuer to issuer, some of the key documents required to apply for a credit card are as follows:

• Identity and Signature Proof- Passport, PAN CARD Driving License, Voter ID card, Aadhaar card, employee identity card in case of government employees.

   

• Address Proof- Bank statement, Rent Agreement, Voter ID card, Ration card, Passport, Driving License, telephone/ electricity/ water/ credit card bill or Property tax.

   

• Age Proof- Voter ID card, Secondary School Certificate (class 10), birth certificate, Passport, Aadhaar Card, pension payment order or Receipt of LIC policy.

   

• Income proof for Salaried Individual: Latest 3 months' salary slips, Salary account bank statement for six months.

   

• Income proof for Self-employed businessmen/professionals: Latest IT Returns with computation of income and other certified financial documents along with business continuity proof.

   

  Fees & Charges

  The two main charges that you are required to pay for a credit card are joining fees and annual fees. Apart from these two charges, there are several other charges that cardholders should know about. These include:

  • Duplicate Statement Fee-A fixed sum charge that is applicable if the customer asks to receive a duplicate statement in physical form.
  • Late Payment Charge-This amount is a penalty that is to be paid over and above the interest charges applicable. This fee is payable if the cardholder does not make timely payments.
  • Cash Withdrawal Charges-The cash withdrawal interest is an amount that is charged in case the cardholder uses their credit card to make cash withdrawals against their card.
  • GST-The Goods and Services Tax (GST) is charged on any of the expenses that are made using a credit card. GST depends on the value of the transaction that is inclusive of interest, fees and other charges.
  • ECS or Cheque Return Charge-This is a fixed amount that is to be paid by the cardholder in case of ECS failure or cheque bounce.
  • Foreign Currency Transactions-This fee is a defined percentage of the transaction value for any transactions that are made on foreign land.
  • Over-limit Fee-If the cardholders' fees, purchases or finance charges exceed their credit limit, an over-limit fee is charged from the cardholder.

  Top Lenders

  Given below is a table of top lenders offering credit cards in India-

  • SBI Card
  • HDFC Bank
  • American Express
  • ICICI Bank
  • Axis Bank
  • RBL Bank
  • artered Bank
  • Citi Bank
  • Indusind Bank
  • Bank Of Baroda
  • Punjab National Bank
  • Bajaj Finserv

  Reasons for Rejection

  Ineligibility due to income

  All credit cards have varying requirements for the minimum income of an applicant. If you do not meet that minimum requirement, your application may get rejected. It is recommended that you should try to search for cards that are aligned with your income bracket to avoid any rejection on this basis.

  Poor credit history

  Credit history is what shows your prospective card issuer your risk perception. The following are a few of the situations that would show you as a risky customer:

  • Too many loans:If you already have too many loans, the issuer would presume that your finances are already stretched thin and that will cast doubts on your repayment capabilities.
  • Too many applications: Applying for several credit cards simultaneously will make you come forth as desperate and again cast doubts on your repayment capabilities.
  • Excessive usage:If you use your card excessively and tend to exhaust your credit limit, or even if you use up to 50% of the credit limit on several cards, you will be deemed as financially unstable.

  Residence/Office location

  Surprising as it may sound, the area where you reside or where your office is located, also plays a role in the acceptance of your credit card application. Banks have a list of areas that are blacklisted and where they do not provide any services.

  Incorrect Information

  False or even incomplete information on your application form is also one of the reasons that your application gets rejected. The bank will not call you to supply any missing information, but will straight away reject it. So, it is a good idea to spend some time going over your filled application form and correcting anything that seems out of place, wrong, or incomplete.

  Discrepancies in the Credit Report

  When a change is to be made in your credit report, it usually takes some time. It is also possible that some previous debt of yours that have been cleared are not updated on your credit report. So before applying, make sure that you go through your CIBIL score and report, and inform the authorities if there is any discrepancy in your report.

  Credit Card Bill Payment

  When you get a credit card, a billing date will be mentioned on the document provided with the card. This is the date on which your bill will be generated for the given billing cycle which you are required to pay on or before the due date. The outstanding amount on your card will be shown as- Minimum amount due and total amount due. The total amount due is what you are required to pay. However, if you cannot afford to pay the total outstanding amount, the bank gives you the option to pay the ‘minimum amount due’. When you pay the minimum due amount, no late payment fee will be levied. However, the bank will charge interest on the remaining balance for as long as it stays in your account. So, it is advised to always pay the total amount due on your card so you can save on the late payment fee as well as interest charges.

  Making a late payment on credit cards can also dip your credit score. Your credit report has a section for ‘Days Past Due’, which records the number of days after the due date during which the amount remained outstanding in your credit account. This leads to a low credit score which in turn makes it difficult for you to get loans in the future. Some important terms related to your credit card payment are-

• Total Amount Due- This is the total amount that you have to pay for your card.

   

• Minimum Amount Due- This is the minimum amount you must pay to avoid any late payment charges.

   

• Billing Date- This is the date on which your card statement is generated.

   

• Billing Cycle- This is the period between two billing dates.

   

• Due Date- This is the date on or before which you should clear your dues.

   

• Reward Point Balance- This is a total number of reward points in your account.