Credit card users in India are recorded to have touched 52 million in 2019, inching towards the present growth at a CAGR of 25%. Such a rise in usage can mainly be attributed to their inherent facility allowing instant purchases with users having to pay for that later. Further, with card providers making the new credit card application process simpler and straightforward, accessibility to these tools has only increased.
However, one must fulfill certain conditions to avail of such funding as and when required. While the minimum salary for a credit card is an essential requirement, there are other factors too that an individual must know prior to initiating an application.
Different factors to take note of before a new credit card application
Few of the most important factors that should be taken into consideration include –
- Credit limit
Before making a new credit card application, find out its available credit limit with the selected provider. Such a limit pertains to the maximum amount that a cardholder can borrow and primarily depends on his/her eligibility fulfillment.
Further, one of the important things to know before applying for a credit card is that the entire credit limit must not be exhausted. Ideally, one should not utilize more than 30% of the card’s limit; hence making it essential to opt for a suitable limit that helps maintain such use criteria.
- Rate of interest
The interest rate of a credit card is quite high compared to other kinds of loans. While it is chargeable only on defaulted or delayed bill payments, opting for cards with affordable rates helps keep one’s liability to a minimum during such instances.
- Interest-free period
One must know that there is a definite period between the transaction date and the due date for payment where no interest is levied. You must thus check for the duration of the interest-free period on card options to avail the maximum flexibility.
Such an interest-free period along with a suitable credit limit is one of the reasons why you are smarter with a credit card in your pocket than otherwise.
- Unsecured or secured credit card
A credit card can be typical of two kinds, secured and unsecured. While the former is backed by collateral such as a fixed deposit, the lateral is available based on one’s eligibility parameters such as a minimum salary for a credit card.
Given the differences in their availing procedure, they also come with varying features and facilities. One must select from these two card options suitably as per his/her eligibility or repayment capacity.
- Charges and fees
Another essential factor to be considered for new credit card applications in the various charges and fees that an individual needs to pay to maintain and use this card. Some of those include the annual fees, cash withdrawal charges, late payment fees, etc. It must be ascertained at the very outset that all these fees and charges do not end up exceeding the benefit derived from a particular credit card.
Some credit cards like the Bajaj Finserv RBL Bank SuperCard also offer an interest-free period of up to 50 days for cash withdrawals. Using the card thus allows individuals to avail of added advantages.
Further, pre-approved offers from the card provider further cut down on the hassle related to the new credit card application. These offers are also available on different financial products such as personal loans, business loans, etc. You can check your pre-approved offer by submitting basic details such as name and contact number.
- Repayment options
On the basis of transactions through credit cards, a cardholder would either have to pay a minimum amount due or clear the full outstanding amount for a given billing cycle.
Nevertheless, some card providers also come with other bill payment options such as EMI conversion to make repayment affordable for customers. You must check the availability of such options before going for a new credit card application.
- Other benefits
Apart from immediate access to credit or cash, a credit card also offers cashback options, reward points, and various types of deals or discounts. More often than not, there are attractive introductory offers to new customers as well.
Cashbacks and accumulated reward points further help save on future transactions and vary from one card to another. You might as well keep such benefits in mind when selecting a suitable credit card.
The sheer number of options available to individuals today can make the right credit card selection overwhelming. Apart from considering your spending habits, the factors mentioned above would thus enable you to zero in on the right one to maximize benefits from your card usage.
Stay Connect with Get News 360 & our Finance Blog, If you have topics for my website than checkout our write for us finance page.
