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Types of credit card

Different Types of Credit Cards in India

Last Updated 27th Jan 2022

Card TypeBest Credit Cards
Credit Cards for First-time UsersHSBC Bank Premier Master Card, Axis Bank Insta Easy Card, SBI Unnati Credit Card
Credit Cards for Low-Income EarnersCitibank IndianOil Platinum Card, Citibank Cashback Card, ICICI Bank Manchester United Platinum Card
Travel Credit CardsAxis Bank Flipkart Axis Bank Credit Card, Axis Bank My Wings Card, Axis Bank My Business Card
Shopping Credit CardsICICI Bank Coral Card, ICICI Bank Amazon Pay Credit Card, Axis Bank Flipkart Axis Bank Credit Card
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Different Card Types

The way payments are made these days has been changed completely, all thanks to digitalisation. There are different types of payment cards available in the country, like debit card, credit card, fleet card, store valued card and much more. Out of all these cards, credit cards are an excellent way to manage the finances, and also ensures to reduce fraudulent activities. Various banks and financial institutions offer different types of credit cards. The card types are designed in a way that they meet the financial needs of every person. There are three types of credit cards- bank-issued credit cards, priority cards and travel/entertainment card, which are further differentiated. There is a range of credit card types from no-frill credit cards to premium cards which are loaded with premium benefits. For example, there is a card for a person who loves shopping, and there is a travel card for a globetrotter.

Types of Credit Cards

  • Credit Cards for First-time Users: This type of card is specially designed for people who have never used the credit card before. The card is loaded with regular features, and the lender charges a low annual fee when compared to others. This type of credit card is also called basic credit cards.
  • Credit Cards for Low-Income Earners: The card offers several benefits and privileges to the people whose salary is low. The salary eligibility on this card is low when compared to other premium cards. Banks provide low-income credit cards to the people who have salaries between ₹ 8,000-₹ 15,000.
  • Travel Credit Cards: Travel credit cards are the best option for the people who travel frequently. The card is loaded with reward benefits as well as complimentary lounge access. Generally, these cards are launched in partnership with airlines, or travel partners and help save some big amount on travelling.
  • Shopping Credit Cards: A card custom made for shopaholics. Shopping credit cards offer a bunch of benefits like deals, discounts, rewards, and cashback every time a cardholder makes an offline or online purchase for retail purchase.
  • Rewards Credit Card: Reward credit card is a type of credit card which offers some kind of reward every time a cardholder swipes the credit card. Every bank offers different reward points for every transaction. Card issuers let cardholders earn reward points on grocery shopping, bill payments and much more.
  • Cashback Credit Cards: Cash Back credit cards are for the people who love to save immensely. These credit cards offer a certain percentage of spending as a cashback. The card offers cashback on restaurant bills, fuel transactions and much more.
  • Fuel Credit Cards: Fuel credit cards offer a host of benefits while purchasing fuel and enjoy surcharge waiver at fuel outlets.
  • Entertainment Credit Cards: Entertainment credit cards are a type of a credit card which provide offers on movie ticket purchase, amusement park ticket purchase, concert ticket purchase and other events.
  • Secured Credit Cards: Secured credit cards are offered against cash deposits, the cardholder needs to deposit cash as collateral. The collateral as a security in case a cardholder is not able to make payments of credit balance.
  • Student Credit cards: Student credit cards are tailor-made for the college students. It allows students to manage their expenses in an easy manner. This card helps in improving the credit score of a student before he/she graduates.

How to select a Credit Card?

  • Check your credit score: Credit score plays a vital role in determining the credit card that you need. Generally, banks offer reward cards to the people who have credit scores higher than 650. Before selecting the card, check the eligibility criteria type of a card and check your credit score accordingly.
  • Use of card: Understand the need of the card. Whether you need the card for emergencies or you need the card to make daily payments. If you don’t understand the need of the card then you may carry a balance from month to month, and you may end up paying more annual fees as you won’t be able to meet the annual fees waiver limit. For example: if you don’t go out to watch movies as much then there is no need to buy an entertainment credit card.
  • Ask yourself why you need the card: Credit card is used for various purposes like making payments for daily needs, taking credit for emergencies, increasing credit score or transferring the outstanding balance to other accounts. If you need the card to build the credit score, then you should go for a credit card type which does not charge annual fees and if you want to make payments for daily expenditures, then you should opt for a lifestyle credit card.
  • Research thoroughly: Before applying for a type of credit card, you should do thorough market research. Compare the various types of credit cards available in India and which one suits your need the best. However, market research is not a tedious task as you can compare the different card types by going on a single site.
  • Interest rate: Once you have decided on the category of a credit card, then you must look for a financial institution which is offering a credit card at the lowest interest rate with added benefits. You can always get a credit card as per your needs, plus get some added benefits. For example, if you have applied for a fuel credit card, then with fuel benefits, you may also get offers on entertainment.
  • Fees and Penalties: Another important point which needs to be considered while selecting the type of credit card is fees and penalties charged on the category type. Banks charge fees like balance transfers and cash advances which need to be checked thoroughly if you will be able to make all the payments on time. Banks also charge a penalty if you don’t pay the balance on time, so clearly check if all the charges are according to your finances.

FAQs

Which type of credit card is best?

Rewards credit cards are the best type of credit card as they help save the hard-earned money. Cardholders can save a lot by making online and merchant transactions for shopping, dining and travelling.

What is the hardest credit card to get?

Premium credit cards like shopping credit cards, travel credit cards and reward credit cards take time for approval, and they have strict eligibility criteria.

What credit card do billionaires use?

Billionaires, people with high income, use premium credit cards. Premium credit cards are entertainment cards and shopping cards, these cards offer high credit limits to the cardholders. Before applying for a premium card, you must check the eligibility.

What is a good credit card for a beginner?

If you are a first time user, then you should go for a credit card for first time users. The card does not charge any annual fees and has some basic features.

What kind of credit card should I get for my first one?

You should get a Cashback credit card or Reward credit card for the first time. Cashback credit cards have the maximum flexibility in how you redeem the reward points. Reward credit cards help to earn free products using reward points.


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Credit Card News - Jan 2022
  • 2021-12-28 : RBL Bank Extends Partnership with Bajaj Finance for 5 Years
    RBL Bank has extended the co-branded credit card partnership with Bajaj Finance till 2026. In addition, the portfolio of co-branded credit cards also crossed Rs. 10 lakhs card mark.
  • 2021-12-24 : RBI Extends Deadline for Debit and Credit Card Tokenisation
    RBI has extended the deadline for tokenisation of debit and credit card to July 1, 2022. Earlier, the last date was January 1, 2022.
  • 2021-12-17 : AU Small Finance Bank and Pine Labs Enters into Partnership
    Pine Labs, a merchant commerce platform, has partnered with AU Small Finance Bank to allow credit cardholders to avail of equated monthly instalments offers at the point of sale. As a result, the customers will be able to convert their regular purchase into interest-free EMIs.
  • 2021-12-15 : Axis Bank Witness Credit Growth in 18-24 Months
    Axis Bank has seen double-digit growth in GDP and Credit in FY 2024. At the same time, the GDP and credit are seen at 9.5% and 7% in FY 2022. Therefore, the bank aims to achieve GDP and Credit Growth at 8.2% and 8%, respectively.
  • 2021-12-15 : SBI Launches Fitness Focused Credit Card
    State Bank of India has launched a fitness-focused credit card, SBI Pulse Card. The card provides welcome gifts such as Noise Color Fit Pulse Smartwatch worth Rs. 4999 and other health benefits.
*Terms and conditions apply. Credit at sole discretion of lender, which is subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and collected from public sources. Read More
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