What are Types of Credit Cards in India?

  • July 11, 2024
  • Dushyant Sharma
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We’ve all heard about credit cards and also probably own at least one credit card. Because of credit cards, we can make purchases and pay for them later. So, at times, when we’re running short of money, a credit card serves as a savior. 

 

Although most of us are aware about what a credit card is, many of us don’t know about all the different types of credit cards in India. If you’re curious how many types of credit cards are available in India, this blog post is definitely meant for you.

What is a Credit Card?

Although most of us have a rough idea of what a credit card is, it is important to know the exact definition of credit card. A credit card can be described as a type of credit facility which is provided by banks to their customers to enable them to borrow funds within a pre-approved credit limit. This allows the customers with credit cards to make purchase transactions on goods and services.

 

The limit of the credit card is decided by the bank - the credit card issuer, on the basis of income and the credit score. A credit card includes crucial information such as the credit card number, cardholder name, expiration date, cardholder signature, CVC code, and other details.

 

The best feature of credit cards is perhaps the fact that they’re not connected to the bank accounts of the customers. Therefore, when you make a payment using a credit card, the amount gets deducted from the credit card and not your bank account. 

 

Many people avail the service of credit cards to cover travel and medical expenses, lifestyle products and also on groceries and clothing (especially when there are credit card schemes which offer discounts.) 

What are the Different Types of Credit Cards Available in India?

Now let’s find out all the different types of credit cards in India:

1. Cashback Credit Cards

As the name suggests, a cashback credit card offers cash back on a percentage of the amount spent with the help of that credit card as mode of payment. The cashback can be in the form of reward points or cash. Cashback credit cards provide offers on expenditures related to electronic gadgets, lifestyle, online bill payment, online food delivery, movie tickets, cricket match tickets, groceries, etc. 

2. Life Time Free Credit Cards

Lifetime free credit cards are those credit cards on which the cardholders are not required to pay an annual fee and in most cases, joining fee isn’t charged either. The cardholders with lifetime free credit cards get cashback and reward points on purchases made through them. Many companies, for their promotion, offer their customers lifetime credit cards.

3. Premium Credit Cards

A premium credit card is an expensive credit card which focuses on the user's comfort. Premium credit cards offer benefits such as unlimited access to airport lounges, dining discounts, golf course visits, discounts on healthcare facilities and offers on flight bookings. Compared to a normal credit card, a premium credit card can be ten times or even more expensive.

 

Premium credit cards are all about luxury and comfort. Although it offers the facility of reward points, the main focus of a premium credit card is the luxury it offers.

4. Reward Points Credit Cards

Reward points credit cards offer reward points when you spend a certain amount of money at once. For instance, the majority of companies would award two or four reward points for every Rs. 100 spent. You can also receive additional reward points for your birthday, renewal and other special occasions such as Diwali, Father’s Day, etc. You can use these points to avail the products and services included in the rewards catalog, which also offers cashback incentives, air miles, trip packages, and other offers.

5. Travel Credit Cards

Some banks have created cards in partnership with travel agencies to facilitate those who wish to take frequent trips or vacations. The travel credit cards give users reward points that they can use to purchase vacation packages or buy airline tickets. The reward points they accrue can be redeemed for some other travel packages or airline tickets. 

6. Co-Branded Credit Cards

Multiple banks in India have teamed up with popular shopping websites like Myntra, Flipkart and Ajio and launched credit cards to make it easier for customers to shop at these shopping websites. These websites are able to attract loyal customers with the help of co-branded credit cards while also offering their customers substantial savings.

7. Student Credit Card

Student credit card is credit card type which enables students attending colleges to have credit access. As many college students are not employed at the time of studying, they lack credit history. This is why the criteria to apply for a student credit card is pretty easy. The student credit card generally comes with lower interest rates and usually there’s no joining fee charged by banks on these cards.

8. Fuel Credit Cards

Many banks collaborate with oil companies to offer fuel credit cards to their customers. Customers with fuel credit cards can avail fuel points or cashback on their fuel purchase from any petrol pump of the partner company.

9. Contactless Credit Cards

Contactless Credit Credits come with a special payment technology which allows cardholders to make purchases by just touching their cards at point-of-sale terminals. In most cases, on an amount up to Rs. 5,000, contactless transactions do not require the users to enter a PIN number for the purpose of making a payment. Numerous advantages are offered by contactless credit cards, including cashback, freebies, savings, reward points, access to lounges, insurance policy discount, etc. 

10. Credit Cards with Credit Lines

The credit line is the main feature and advantage of these credit cards. This means that these credit cards have a kind of a pre-approved loan which an individual can avail when required from an ATM without any paperwork or security. 

 

Generally, for a certain period of time, no interest rate is charged by these credit cards. However, if one delays the repayment on time, it’ll be regarded as a loan. Other than the borrowing facility, these cards do not really have any other advantageous features.

Conclusion

There are many types of credit cards in India, offering different perks, reward advantages and interest rates. Before choosing a credit card type, you must take into account the rewards, benefits, joining fees, annual fees, interest rates, etc. of all the credit cards available in India. You must also evaluate the customer service provided by the bank issuing the credit card and the satisfaction rate of the customers. You can get several financial benefits by availing credit card services. However, you must make sure you repay the amount on time.


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Dushyant Sharma
Author: Dushyant Sharma

Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.

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