Getting a secured credit card in India is a relatively easy and reliable option if you don’t have an adequate credit score. These types of credit cards are backed with a deposit, eliminating the issuer’s need to verify your credit score.
Apart from this fundamental difference, a secured credit card works similar to an unsecured one. Here’s a quick look into the top advantages and characteristics of these cards:
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Access to Instant Credit
Securing credit with a good score is challenging. But with secured cards, you can enjoy an instant credit limit that is based on your FD. There are no restrictions on usage, so you can use it for shopping, paying bills, or any other expenses.
You can also enjoy the benefits of rewards, cashback, and discounts, which is one of the most significant advantages of owning a credit card. Most of these cards also come with an EMI conversion facility, allowing you to pay for big expenses in small instalments.
Quick Approval
Generally, when you apply for a credit card, issuers check your eligibility and other parameters to evaluate your eligibility. This process can take time, from a few days to weeks. However, such is not the case for a secured credit card in India. All it takes to apply is booking an FD with your credit card issuer.
This deposit acts as collateral, so the issuer can skip checking your credit score and other formalities. This reduces the application time, and you can get instant approval.
Available to Anyone
The credit score requirement of unsecured cards limits the group of people who can get it. However, a secured credit card in India is available to anyone who can put up the minimum required security can get the card.
You do not have to provide income proof or have a high credit score. This feature also makes it a great way to start a credit journey to better credit health and financial management.
Note that although there is no credit score criterion, issuers may have an age criterion. Generally, all individuals above 18 years of age can easily apply for a credit card against a fixed deposit.
Helps you Build Credit Score and History
Applicants with good credit scores can easily get a credit card, but to build a credit score, you need access to credit in the first place. A secured credit card is a great solution to overcome this paradox.
You can easily apply for this card, even if you have no score, and gradually build your score by effectively managing your credit card. This means that you must pay your dues on time and in full.
Control Over Credit Limit
In FD-backed cards, the credit limit is linked to your deposit value. Most issuers offer up to 90% of the deposit as collateral. This means if you pledge a deposit of ₹1 Lakh, you can get a limit of up to ₹90,000.
Because of this, you can control your limit by pledging if you need a lower limit and vice-versa. Remember, issuers generally do have a minimum and maximum FD amount you can offer. Check and compare this along with the limit ratio to choose one that is in line with your requirements.
Option to Switch to Unsecured Card
Most issuers also give you the option to change your secured card to an unsecured one. This happens over time and under certain conditions, one of which is using your card responsibly.
By paying credit bills on time, you can showcase good credit management skills. You can also maintain a credit utilisation ratio of under 30%, which helps boost your creditworthiness.
Interest on Fixed Deposit
Another lucrative benefit of opting for secured cards is that issuers offer lucrative interest on the FD linked to the card. So, you don’t just get access to credit but also secure financial growth – all with just one card.
Keeping all the benefits in mind, you can take better control of your finances and earn better rewards. With OneCard’s FD+Credit Card, you can get started with a minimum deposit of just ₹5,000. The process can take up to 5 minutes, and your virtual credit card activates instantly.
Once you have enough credit scores, you also become eligible for the regular One Credit Card. These cards give you 5X rewards on your top two categories, have no joining or annual fees, and much more. Apply now to enjoy the experience of shopping with the first metal credit card in India.
