Credit Card This term is heard a lot when we go to make online payments. Do you know what is a credit card, what are the benefits of a credit card, how many types of credit cards are there? Credit cards are used for shopping or paying bills, but in fact, even today many people do not know what a credit card is, so let’s know.
Credit Card kya hota hai | what is a credit card
Credit card is a financial instrument issued by banks for carrying out cashless transactions with a predetermined credit limit. The card issuer i.e. the bank decides the credit limit of the credit card on the basis of your income, your credit score and credit history.
Credit card i.e. borrowed account – Credit card is like a borrowed account because in this you get a credit limit for making purchases, so that you can pay bills by shopping online and at the end of the month go to the bank and pay the balance in your credit card Can deposit.
Credit card is also a type of loan. The difference is that this loan is given by the bank in advance, which means you can make purchases or use the credit card amount when you need it.
Credit card has become a daily necessity in today’s era. People use credit cards for many important things ranging from shopping, so if you have not yet applied for a credit card, apply now by going to your bank.
How does a credit card work?
When you are repayable after taking a loan from the bank i.e. your credit history is good, then only banks issue you a credit card. By checking your paying capacity based on your credit history, the bank offers you a Limited Credit Limit i.e. you can make credit card payments in a month up to that fixed amount.
By spending money with a credit card, you borrow money from the card issuing bank, which you have to repay within a specified time. You get a debt-free period of 45-90 days between credit card bill generation and purchases. If you do not pay the credit card bill on time, then you have to pay a penalty on it.
You can apply for a credit card by going to the bank where you have an account, if the bank is satisfied with your bank statement, it will give you the credit card. After this, you can pay with credit card at any online platform or showroom or store where credit card payment is accepted and do any secure transaction without cash.
Top Banks Offering Credit Cards
|SBI Card||ICICI Bank||Bank of Baroda|
|IDBI Bank||HDFC Bank||axis Bank|
|RBL Bank||yes bank||American Express|
|standard Chartered Bank||City Bank||IndusInd Bank|
|HSBC Bank||Kotak Mahindra Bank||Union Bank|
credit card types
- shopping credit card
- travel credit card
- Lifetime-Free Credit Card
- Entertainment Credit Card
- Rewards Credit Card
- fuel credit card
- premium credit card
- secured credit card
- Co-Branded Credit Card
Documents required for credit card application
- PAN Card, Aadhaar Card
- Identity Proof – PAN Card, Driving License, Passport, Voter ID Card, Aadhaar Card, Employee ID Card.
- Proof of Residence – Rent Agreement, Ration Card, Voter ID Card, Passport, Driving License, Electricity Bill.
- Income proof – Latest 3 months salary slip or 6 months bank statement or latest income tax return etc.
The documents required for credit cards differ from bank to bank. If you have a pre-approved credit card offer from the issuer, you may not need to submit any documents.
Precautions in Credit Card Usage
- The amount borrowed from a credit card is to be repaid within a stipulated time frame.
- Never spend or pay more than your credit limit.
- Find out about all the charges and fees associated with your credit card.
- Do not fully utilize your available credit balance; Keep around 30-40 per cent for emergencies.
- Keep a close eye on your credit card details and follow all necessary security guidelines.
- Avoid making late payments to maintain a good credit score.
- Don’t miss credit card payments on time as you may have to pay a penalty.
- Do not share your credit card information with anyone.
- If you lose your credit card, contact the bank immediately.
- Never save your credit card data online.
- Also contact the bank immediately if you come across an unauthorized transaction.
- Do not give your credit card to anyone and it should be swiped in your presence.
- Make the most of your card benefits and reward points.
Top 10 Best Credit Cards
|SBI Elite Card||Amazon Pay ICICI Bank Credit Card|
|Citi Premier Miles Credit Card||HDFC Millennia Credit Card|
|Standard Chartered Digi-Smart Card||Axis Bank Ace Credit Card|
|HSBC Cashback Credit Card||HDFC Regalia Credit Card|
|SBI BPCL Octane Credit Card||Flipkart Axis Bank Credit Card|
Credit Card FAQ
What is the advantage of credit card?
The major advantage of a credit card is that whenever you make a purchase through it, you get a grace period of 45-90 days between the purchase and payment, in this grace period the interest is not charged by the bank and you can never repay during this period. You can also pay to the bank.
What is the difference between Debit Card and Credit Card?
Debit card works only when there is money in your bank account, whereas credit card works even when there is no money in the bank. When you swipe the debit card, money is deducted directly from your bank account; On the other hand, when you swipe a credit card, money is deducted from the credit limit provided by the bank.
Who issues credit cards?
Credit cards are issued by banks and financial institutions (NBFCs) on the basis of your credit history like 1. Banks – SBI, ICICI, HDFC etc. 2. NBFC – Aditya Birla Capital, Muthoot Finance, Manappuram Finance etc.
Who can take the credit card?
A person who has a bank account, has a good credit history and is 18 years old is eligible to get a credit card.
Is it good to have a credit card?
Having a credit card can be a good option when you use it in a proper way, otherwise it can lead to a debt liability for you. When you take a credit card, your credit history becomes good in the bank as well and you can also get other benefits of the bank.
How much interest is charged on credit card?
Generally, an interest rate of 2.5 percent to 4 percent per month is charged on credit cards but this rate may vary from one bank to another.
What should be the salary for credit card?
There is no minimum salary requirement for the credit card. You can apply for a credit card if you have a good credit history as per the bank statement. If the bank is satisfied, you will be provided with a credit card.
What are the disadvantages of credit card?
If you use the credit card properly then there is no harm in it and if you spend unnecessarily then the credit card will become a burden for you in the form of debt.
What is the credit card limit?
No minimum and maximum limit of credit card is pre-decided, rather the bank sets the limit on the basis of your credit history and income statement, which can range from ₹ 10000 to ₹ 50 lakh or more.
Can we get a credit card at the age of 20?
Yes, you can get a credit card at the age of 20 because the minimum age for applying for a credit card is 18 years, so you can apply by visiting your bank with the necessary documents.
In how many days the credit card money has to be deposited?
Credit card money has to be deposited on the due date fixed by the bank. Generally, many banks offer credit limit of 45 to 90 days, after using the payment limit, you have to deposit this amount within 45 to 90 days.
For how many years is the credit card valid?
The validity of the credit card is decided by the bank, which generally ranges from two and a half years to 4 years, in some special cards this validity may be more or less.
How much money can I use with a credit card?
You can use the money up to the maximum limit of the credit card, but you should use this amount only to the extent of 60 to 80% so that whenever you need it, the remaining 20 to 40% amount can come in handy in case of emergency.
Can a student get a credit card without a job?
Yes, any student can get credit card without job, there is no role of job in this. Simply, you should be at least 18 years old, have a good credit history and your bank statements and transactions should satisfy the bank.
How many credit cards can a person have?
A person can have as many credit cards as there are bank accounts, there is no pre-determined limit on credit card holding. You can keep any number of credit cards as per your requirement but according to experts you can keep 3-5 credit cards.
Where can I use the credit card?
You can use the credit card to shop, pay bills, recharge, pay someone, transfer money, book all kinds of tickets, and do other online money transactions.