What is a Credit Card

This article covers the primary details about credit cards and why you should possess one. Read on to know ‘how to apply for a credit card’ and everything else that there is regarding its functioning, workings, benefits and features, and eligibility criteria.

What is a credit card?

The way a credit card works is simple. It’s a digital product you own that lets you borrow money from the banks. Once borrowed, you have to return the money within a month or the given due date. If the due date is over, you might have to pay interest or penalty charges. The ability to buy now and pay later beats other forms of payments like debit cards or cash, which require you to have the money ready to pay at the time of purchase. Not only do credit cards give you more flexibility with payments, but they also help in determining your individual credit score based on your past payment clearing history, so you can qualify for other financial products like loans and mortgages.

The eligibility criteria are simple to follow, if you have available the documents required for credit card applications. Credit cards are widely adopted in the modern era as an expense tracker and find application in many sectors. 

Benefits & features

Before understanding how to apply for a credit card, you should learn about the reasons to own one. The main benefits and features are listed below.

Features Benefits
Global Acceptance Secure alternative for cash
Utility bill payments You can deal with financial emergencies hassle-free
Any-time purchases according to your heart’s desire Availability of interest-free periods if payments are on time
EMI payment options Customer benefits like rewards, loyalty points, welcome offers, cashback, waivers
An add-on credit card option may be available Positively affects your credit score
Transaction alerts, balance transfer Your purchasing power increases
Annual fee waivers could be a feature for many credit card providers. Various custom offers like concierge services, travel benefits & premium options for the airport, VIP lounges, insurance, golf programs.
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Why should you get one?

The above-listed features and benefits could be attractive if you are planning to apply for a credit card. However, there are more reasons for you to opt for a credit card and become a proud owner. First, the fees incurred on credit cards are comparatively low. Second, proper usage of credit cards can help with your credit score, reflecting positively on numerous loan and mortgage related decisions.

A credit card is considered the most secure form of transaction in the world of finance. As a result, it can help you prevent fraud and tackle digital safety issues. After all, you are only as credible as your last transaction. In addition, the documents required for credit card are flexible, giving you plenty of options to prove your eligibility.

Another reason for you to own a credit card is the amount of accountability it offers. Increased use of credit cards will keep the merchants and vendors more responsible. A shred of digital evidence remains in the case of credit card transactions. You will also be subjected to transaction inquiries if the card provider deems it fit.

Eligibility criteria

The eligibility criteria are simple to follow, if you have available the documents required for credit card applications. Credit cards are widely adopted in the modern era as an expense tracker and find application in many sectors.

  • You should be a citizen of India or an NRI to avail of this product. 
  • Your age must be a minimum of 18 years.
  • You should be self-employed or salaried with a clean financial background, primarily a good credit score.
  • You should submit a document supporting your address proof.
  • You should have an identity proof document.
  • You should possess a document showing the minimum income required. It could ideally be in the range of INR 1-3 lakhs.
  • Banks or non-banking financial companies may have specific requirements based on their policies.
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The documents proving your identity, income, or address can be an Aadhaar card, voter ID, driver’s license, last payslip, bank statement, work cards, UIDAI letters, utility bills, grocery cards. The Indian Origin Card or Property Registration Document is also valid.

The application process

  • Visit the desired bank in person or go to their online site.
  • Check the list of credit cards offered by them.
  • Select your preferred card.
  • Fill a simple form with your contact details if you are checking online. The bank or the NBFC representative will get in touch with you.
  • If you are opting for the direct method, you can discuss with the relevant person about the application process.


It would be essential to understand how to apply for credit card online as they’re the most preferred method given the pandemic. Top credible financial institutions can help you with the process. It includes an active support function and fast processing times. In addition, responsible spenders can improve their scores by tracking on-time payments and spending and keeping their card balance low relative to their card limits. Moreover, credit cards are best used by the disciplined who are aware of their ability to pay the monthly bill (preferably in total) on or before the due date.


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