frequently asked question

A credit card is a financial tool provided by banks that allows you to borrow funds up to a pre-approved limit. It enables you to make purchases of goods and services on credit, with the obligation to repay the borrowed amount later.

A secured credit card operates like a standard credit card but requires collateral, such as a fixed deposit, to back it. This collateral minimizes risk for the issuer and is particularly beneficial for individuals with limited or poor credit histories. Timely payments on a secured credit card can help improve your credit score. If payments are missed, the issuer may recover the owed amount from your deposit.

A debit card withdraws funds directly from your bank account, using your existing deposits. In contrast, a credit card allows you to borrow funds from the issuer up to a certain limit, functioning as a short-term loan. At the end of the billing cycle, all credit card expenditures are consolidated into a single bill for repayment.

Credit cards can be categorized as follows:

Standard Credit Cards: Offer basic features with minimal or no annual fees; suitable for everyday use.

Co-Branded/Specialized Credit Cards: Tailored to specific needs, offering privileges in areas like dining, fuel, or travel.

Reward Points Cards: Earn points on purchases, which can be redeemed for gifts or vouchers.

Cash-Back Credit Cards: Provide a percentage of your spending back as cash, credited to your account or statement periodically.

At Credit Tales, you can complete an online credit card application in under two minutes. After submission, the card issuer will contact you to collect necessary documents. Once all documents are received and verified, the application is processed, typically within two weeks. If approved, you should receive your credit card within seven working days. The bank will keep you informed about your application’s status via SMS or email.

Your credit limit is the maximum amount you can borrow on your credit card. It’s determined by factors such as your financial profile, repayment capacity, and credit history. To request a higher limit, contact your card issuer; they will assess your eligibility based on their criteria.

The minimum salary requirement varies depending on the credit card issuer and the specific card. Generally, banks have set income criteria to ensure applicants can manage credit responsibly. It’s advisable to check with the specific bank or refer to their official guidelines to determine the exact income requirements for the credit card you’re interested in.

Yes, individuals with low credit scores can apply for credit cards. However, approval depends on the bank’s policies and the type of card. Secured credit cards, which require a fixed deposit as collateral, are often more accessible to those with lower credit scores and can help in rebuilding credit history over time.

After submitting your credit card application, banks typically provide an application reference number. You can use this number to check the status of your application through the bank’s official website, customer service helpline, or by visiting a branch. Additionally, some banks offer SMS and email updates regarding application status.

If your credit card is lost or stolen, immediately contact your bank’s customer service to report the loss. The bank will block the card to prevent unauthorized transactions and guide you through the process of issuing a replacement card. It’s crucial to act promptly to safeguard your account.

Yes, most banks impose late payment fees if you do not pay the minimum amount due by the payment due date. Additionally, interest charges may accrue on the outstanding balance. It’s important to review your credit card’s terms and conditions to understand the specific fees and charges associated with late payments.

Not all credit cards come with an annual or joining fee. For instance, the Amazon Pay ICICI, AU Xcite and IDFC FIRST Millennia Credit Card offers zero annual and joining fees. However, credit cards may have other applicable charges, such as over-limit fees, late payment fees, and foreign transaction (forex) charges. It’s important to review the terms and conditions of each card to understand the potential costs.

Yes, credit cards can be used to withdraw cash from ATMs. However, this service, known as a cash advance, incurs additional charges, typically ranging from 2.5% to 3.5% of the withdrawal amount. These charges can vary by card issuer and may also attract interest from the day of the withdrawal.

Cashback credit cards return a percentage of your spending as a cashback amount, which is periodically credited to your account. Rewards credit cards, on the other hand, earn you points for every transaction, such as 1 reward point for every ₹100 spent. These points can later be redeemed for benefits, but redemption often requires a higher spending threshold.

When choosing between the two, consider your spending habits and goals. Cashback cards are ideal for focused benefits like dining, fuel, or movie tickets. Rewards cards are better suited if you want broader, multidimensional benefits. Evaluate the value proposition of each card to align it with your lifestyle and financial needs.