In India, there has been a considerable surge in the number of credit cards, notably, post demonetisation. Millennials have been a major reason for such growth. According to reports, there has been a 35% increase in the number of millennial cardholders in India.

Such growth can largely be accredited to the growing awareness regarding the different types of credit cards and their usage benefits for a comprehensive range of consumers.

There are primarily two types of credit cards in India –

• Secured credit card.

• Unsecured credit.

There are further variants under unsecured credit cards.

Secured credit cards

Secured cards can be availed against a fixed deposit account. The fixed deposit account works as a collateral asset for the financer who shall withdraw the amount deposited to compensate for losses that arise out of delinquency. Such cards possess features which are somewhat similar to unsecured cards; however, there are certain dissimilarities on account of the fact that cards are issued to individuals with a low credit score.

Unsecured cards

Unsecured cards are provided based on an individual’s credit score and financial credibility, where you do not have to provide any security to such a financer. The different types of unsecured cards are –

1. Travel cards – Travel credit cards are designed to meet the financial necessities of frequent travellers. These cards feature discounts or offers on hotel bookings, flight tickets, etc. which you can redeem with the use of reward points. Cards such as the Bajaj Finserv RBL Bank SuperCard also provide complimentary access to airport lounges.

2. Business cards – These credit cards are specifically offered to businesses. It allows business entities to properly track their expenses and maintain it accordingly.

3. Balance transfer cards – Such credit cards facilitate the transfer of any outstanding balance on another existing credit card. You can get a credit card to transfer your balance to benefit from lower interest rates on the outstanding dues. 

Eligibility criteria

• A credit score above 750 (for unsecured cards.)

• A substantial repayment history (for unsecured cards.)

• Aged between 25 – 65 years of age.

These criteria can vary with different financial institutions.

You should carefully consider the different features of varying types of credit cards before you apply for one. Refer to leading financiers for the most beneficial credit card features.