new faq for cc

A credit card is essentially an unsecured loan; like borrowing money to spend up to a certain limit and then pay it back in the future. There is generally a minimum amount that you must repay each month. There are a wide variety of different types of credit card available designed to suit different particular purposes.

Normally, a credit card comes with the following features-

Alternative to Cash: Having a credit card is a very safe and convenient alternative to carrying a bundle of cash. It can make shopping hassle-free and will also ensure the safety of money.

Emergencies: Whether there is a medical emergency or some other kind of urgent cash requirement, credit cards can provide help by making immediate credit available under such circumstances.

Making Big Purchases: The whole concept of ‘buy now pay later’ makes it rather easier for people to make some big purchases and setting up an EMI pay back method with their banks.

Build Your Credit Score: One of the biggest advantages of owning a credit card is that it is easy to build a credit history through your credit card transactions. Also, repaying all your credit card dues in time will help improve your credit score which, in turn, can help you in getting loans in the future. Many times loan applications are rejected because the applicant doesn't have a credit history and having a credit card is one of the easiest ways to build your credit history.

Secure Transactions: New credit cards feature the chip and pin system, which adds to their security, hence they are safer than carrying around large amounts of cash and also save you from Credit Card Fraud. In case of online transactions, a two tier authentication system is followed, where apart from the information on the card such as card number, expiry date and CVV, an OTP or secret password is also required to complete the online transaction which is sent to your registered mobile number.

Track Your Purchases: When using cash, it becomes difficult to keep track of the purchases. However, with a credit card, you can easily maintain a track record of the transactions that you have made with the help of the monthly credit card statement.

In today’s customer-centric market, there is a credit card for every need. Few major categories are :

• Lifestyle credit cards
• Shopping credit cards
• Travel credit cards
• Reward credit cards
• Cashback credit cards
• Fuel credit cards

Welcome Gift – Many banks offer a welcome gift to new credit card applicants once the card is issued to them. This gift can be in the form of bonus points, gift vouchers, discounts, etc. The welcome gift differs depending on the card and the bank.

Rewards Program – All credit cards generally have a reward program, which allows cardholders to earn reward points on every transaction they make using their cards. The amount of points that cardholders can earn per transaction is fixed and differs from card to card. The points that card members collect can be redeemed for various gifts that are listed in the rewards catalogue of the cards. These gifts can be discounts, product, services, cashback offers, etc. Some credit cards allow card members to redeem their points against air miles and cash as well.

Fuel Surcharge Waiver – Many banks offer fuel surcharge waiver to credit cardholders when they spend specific amount of money on fuel every month. This offer is available on fuel transactions made at all Indian petrol bunks.

Cashback Benefits – There are certain credit cards that offer cashback benefits to the customers. The amount of cashback that will be offered depends on the provider.

Lifestyle Benefits – Cardholders can enjoy various lifestyle benefits on their credit cards. Lifestyle benefits include dining, shopping, golf, wellness, entertainment, etc. privileges.

Travel Benefits – This is one of the major reasons for credit cards being so popular among people. There are some credit cards that offer amazing travel benefits to the customers. Travel benefits include air miles, airport lounge access, travel insurance, airline offers, hotel offers, etc.

Airport Lounge Access – Some credit cards offer complimentary airport lounge access to the cardholders. The offer varies from one bank to another. Some banks put a limit on the number of visits, while some others allow access only to Indian airport lounges.

Exclusive Privileges from Visa/American Express/MasterCard – Visa, MasterCard and American Express are three popular and recognized credit card variants. Depending on the variant of your card, you can enjoy exclusive lifestyle, travel, etc. offers from MasterCard/Visa/American Express.

Add-on Cards – Many banks allow their credit cardholders to apply for add-on cards for their immediate family members. Most card issuers offer add-on cards for free, but some of them limit the amount of add-on cards that one can apply for. Cardholders can enjoy all the privileges of their primary cards on their add-on cards.

Air Miles – Certain credit cards such as travel or Airline cards offer Air Miles to their customers. These miles can be JPMiles, Air India Air Miles, etc. Cardholders can collect these miles and redeem them to avail flight tickets and other travel benefits.

Banks have varied eligibility requirements when it comes to credit cards. The criteria also vary from one credit card to another. However, the basic criteria that an applicant is required to meet include age, income and credit score/history.

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

Rewards can be earned in the form of points which can later be redeemed against gift vouchers or statement credit whereas cashback comes directly into your credit card account.

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.

Yes. This facility is known as 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 credit card-based purchases.

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

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.

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.

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

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 card holder has limited liability in case of such frauds.