frequently asked question

A credit card is a type of credit facility, provided by banks that allow customers to borrow funds within a pre-approved credit limit. It enables customers to make purchase transactions on goods and services.

Secured credit cards function similarly to regular credit cards. The only difference between a normal and secured credit card is that the latter is issued against collateral, such as fixed deposits, to reduce the risk level for card issuers. Secured credit cards are beneficial for individuals with no or poor credit history. As a result, it is one of the easiest methods to enhance your credit score while enjoying the benefits of a credit card. Secured credit cards are issued in exchange for a fixed deposit, which decreases the risk for credit card companies. If you do not pay your payment on time, the credit card company may deduct the amount from your deposit.

A debit card allows you to withdraw money directly from your bank account deposits. A credit card, on the other hand, is similar to a short-term loan from the card issuer that allows you to make payments or withdraw cash. Rather than repaying this short-term loan on a per-use basis, all of your credit card spending are combined into a single bill at the end of the billing cycle.

Credit cards can be broadly divided into two categories:

• Standard Credit Cards – Plain credit cards with basic features and no annual fees.
• Co-Branded/Specialized Credit Cards Credit Cards – Credit cards are designed especially to cater specific needs of the cardholder. These cards offer various privileges on dining, fuel, travel, etc.

             However, credit cards can also be classified as follows:

• General Cards – Credit cards offer basic features and have relatively low annual fees. These cards are ideal for everyday usage.

• Reward Points Cards – Credit cards offer reward points to cardholders for every purchase. The more a cardholder spends the more reward points he/she earns. These reward points can be redeemed to get gift vouchers, coupons and more.

• Cash-back Credit Cards – Unlike reward credit cards which offer reward points, cash-back credit cards offer cash. On using a cash-back credit card a specific percentage of the cardholder’s expenditures are credited back to his/her account. The cumulative cash back earned is adjusted against the card account periodically.

credittales.in allows you to apply for a credit card online in less than 2 minutes. After you complete and submit the online application, the card issuer will contact you and request you to send the supporting documentation. Your application will be processed within two weeks after the bank receives your duly filled application form. If all of your documents are in order, you will receive your new credit card within 7 working days after your application has been accepted and all of the bank’s checks have been completed. The bank will provide you with timely information on the progress of your credit card application by SMS or via email.

A credit limit is the maximum amount of credit extended to you on your credit card. Factors on which the credit limit of an applicant depends are his/her profile, the repayment capacity, CIBIL credit report, etc. However, to increase your credit limit, you can raise a request for the same with your provider. Upon raising the request your provider may ask for additional documents or may scrutinize your request based on factors such as credit score, financial status etc. If you are deemed eligible, your credit limit will be increased. Also, if you have paid your credit card balance on time, you may be eligible for an annual credit limit increase from your provider.

No, not all credit cards come with an annual and joining fee. For instance, the Amazon Pay ICICI credit card comes with zero annual and joining fees. But apart from joining and an annual fee, there are several other charges applicable on credit cards such as over-limit charges, late-payment charges, forex charges, etc.

Yes, credit card providers do charge cardholders with penalties if they are unable to pay the due amount on time. Cardholders are usually charged with an interest of 3-4% on their outstanding amount. The amount to be paid is calculated based on the formula: (Number of days counted from the date of transaction made X Entire outstanding amount X Interest rate per month X 12 months)/365.

Yes, you can use your credit card to withdraw cash from an ATM. However, you withdrawing cash using a credit card incurs additional charges which may range anywhere from 2.5 – 3.5%.

On using a cashback credit card a specific percentage of your expenditures are credited back to your account. The cumulative cashback earned is adjusted against the card account periodically. On the other hand rewards credit card offer rewards on almost every spend and at minimal value. For instance, you can get 1 reward point for every Rs. 100 spent, but there is always a higher threshold to get a cashback. Also, while choosing between a cashback and rewards credit card, you must delve into knowing the value benefits of the cards. Another thing to keep in mind while making this choice is your requirement, if you are looking for a card that offers multidimensional benefits, rewards credit cards may be best suited for you. If you are interested in using the card primarily for a particular type of expenditure such as dining, fuel or movie tickets, a cashback card that offers premium rewards in those categories would be perfect for you.