Credit Card

• Choose a card that aligns with your lifestyle. Look for benefits in your major spending category like travel, online shopping, offline shopping, etc.
• Identifying the cards which you are eligible for. Beginners or low-income applicants qualify for entry-level cards, while high-net-worth individuals can get premium options.
• Entry-level credit cards come with lower fees whereas mid-range or premium cards generally charge a higher fee. Decide if you would like a low-fee card with basic benefits or pay a higher amount for better benefits.
• Do a cost-benefit analysis, and review t&c on annual fees, rewards capping, redemption options, and values. Ensure you can maximize spend-based benefits before deciding.
• Avoid applying for multiple credit cards at the same time as it may have a negative impact on your credit score.

Pay your balance in full and on time

The most important rule of credit card usage is to pay your balance in full before the due date to avoid interest and protect your credit score. If you cannot make the full payment, try to pay more than the minimum, which can reduce the interest charges.

Convert large purchases into EMIs

If you make a large purchase, consider converting it to EMIs, which usually comes with a lower interest rate than the standard credit card rate. This way, you can manage the entire expense in smaller and more manageable payments over time.

Avoid cash withdrawals with your credit card

Cash advances do not offer an interest-free period; instead, interest is levied as soon as you withdraw cash. These charges can quickly accumulate debt, so use cash withdrawals only as a last resort.

Keep track of your spending

Monitor your spending to stay within your credit limit and avoid building up a difficult-to-manage balance. Check all SMS alerts and your bank statements carefully about credit card transactions. Besides this, you should also check your credit report at regular intervals to notice and rectify any errors.

Do not apply for multiple credit cards at a time

Applying for too many cards at once can make you look credit-hungry and lower your credit score due to multiple hard inquiries. While a single inquiry may not have significant consequences, multiple inquiries within a short period can negatively impact your credit score. Hence, apply only for cards that truly meet your needs and spending habits.

Here are some do’s and don’ts for using your credit cards wisely:

Key Updates after the Club Vistara and Air India Merger:

• Air India SBI Credit Cards: Reward points on Air India ticket bookings significantly reduced from 31st March 2025
• Club Vistara SBI Cards: Ticket vouchers discontinued; renewal fee waived off from 1st April 2025.
• Club Vistara IDFC FIRST Credit Card: Complimentary Club Vistara Membership and vouchers discontinued; renewal fee waived off from 1st April 2025.

Other Updates:

• SBI SimplyCLICK Credit Card
  • Reward points on Swiggy spends reduced from 10X to 5X from 1st April 2025
• American Express® Platinum Travel Credit Card Rewards Program (Effective 1st April 2025)
  • Flipkart voucher redemption option removed; new redemption partners added, including Postcard Hotels and Air India
  • Devaluation in Taj voucher redemption - earlier 1 MR = Rs. 0.50, now revised to 1 MR = Rs. 0.40
• IndusInd Bank Avios Visa Infinite Credit Card
  • Joining fee reduced to Rs. 10,000 (from Rs. 40,000) and annual fee reduced to Rs. 5,000 (from Rs. 10,000)
  • Activation and renewal benefits now offer only bonus Avios instead of tier memberships and bonus rewards
  • Revised rewards structure - up to 6 Avios per Rs. 200 on preferred international spends
  • Lower milestone benefits - up to 36,000 bonus Avios, reduced from 50,000 previously

For details regarding these updates, click here

Credit and debit cards may look similar and sometimes offer similar benefits, but they function differently. Here’s a detailed comparison to help you understand the key differences:

Feature	Credit Card	Debit Card
Function	A short-term loan extended by the card issuer that requires repayment	A means to spend money directly from your savings or current account
Spending Limit	Can spend within the pre-fixed credit limit	Can spend only up to the balance available in the account
Payment Method	Card issuer pays for your purchases, which you repay by the monthly due date	Amount is deducted directly from your bank account
Interest Charges	Interest charges apply in case of late or partial payments	No interest charges are applicable
Rewards & Benefits	Generally offers enhanced rewards, cashback, and other benefits (varies as per the card)	Usually offers basic rewards, cashback, and limited benefits
Credit Score Impact	Directly impacts your credit score	No direct impact on credit score

Credit card fees and charges can vary based on the card type and issuer. Some charges, like joining or annual fees, are required to keep your card active, while others - such as finance charges, cash withdrawal fees, and late payment fees - apply depending on your card usage. Here’s a look at some common charges:

Particular	Charges
Annual Fee	Varies from card to card
Finance Charges	9% p.a. to 52.86% p.a.
Interest-free Period	Up to 50 days
Cash Advance Charges	0% to 3.5%
Forex Markup Fee	0% to 3.5%

Credit Card Interest Rate

Credit card issuers charge an interest rate, also known as finance charges, which is levied in case of late payments or defaults. While the interest rate varies from card to card, it typically ranges between 9% p.a. and 52.86% p.a.

Unlike other card charges, such as joining or annual fees, the interest rate is usage-based and is applied to the outstanding amount whenever you fail to pay your credit card bill in full. Interest is also charged when you make only the minimum due payment. Whenever you carry forward the remaining balance to the next billing cycle, the interest is levied on both the outstanding amount and new purchases from the date of transaction.

Choosing the right credit card is subjective based on your profile and requirements. To make a wise choice, here are some suggestions:

Identify your preferred spending category

There are different types of credit cards, such as travel, shopping, dining, etc. To maximize the benefits of a credit card, you should analyze your shopping habits. The best credit card for you would be one that fulfills your core needs. For instance, if you frequently travel, choosing a credit card that offers accelerated benefits on travel spends would be beneficial for you.

Shortlist cards based on your eligibility 

Once you've identified your shopping pattern, start by shortlisting the cards based on eligibility. Understand your credit profile & find out the cards you may be eligible for. To do so, you can also check your eligibility at Paisabazaar for pre-qualified card offers.

Evaluate features & benefits

After shortlisting the preferred credit cards, the hardest part is to decide which credit card to choose. To find the right card, you must evaluate all the features and benefits of the respective card and choose the one that fits your needs and complements your budget.

Read the fine print

Once you’ve decided which card to apply for, review all the related fees & charges associated with the card. Analyze whether you will be able to pay the associated fees. Apart from the annual fee, also check for other related charges, like interest rates, late payment fees, etc., to make an informed decision.

While the eligibility criteria may differ across issuers and cards, some general requirements are:

• Age: Minimum 18 years
• Credit Score: Preferably 700 and above
• Employment Type: Salaried or Self-employed

To process your credit card application, you need to submit the following proofs:

• Identity & Signature Proof
• Address Proof
• Age Proof
• Income proof

Some common documents are PAN card, Aadhaar card, employee identity card (in case of Government employees), bank statement, salary slips,  rent agreement, or utility bills. For self-employed applicants income proof requirements may vary. You need to submit ITR documents, Form 16, etc.

Note: Document requirements may vary.

RuPay Credit Cards on UPI

RuPay is a domestic card payment network and currently the only one offering credit card benefits on UPI transactions. In June 2022, RBI allowed the linking of RuPay credit cards to UPI apps, enabling quick payments while earning benefits on UPI spends. Initially, only a few credit cards were available on the RuPay network. However, most card issuers, including HDFC Bank, SBI Card, Axis Bank, ICICI Bank, and more, now offer RuPay variants of their existing cards or are launching new cards on the RuPay network. Additionally, while some cards—such as HDFC UPI RuPay Credit Card—are designed for UPI transactions and offer accelerated rewards on UPI spends, other RuPay credit cards offer a base reward rate or cashback on UPI payments.

Secured Credit Cards:  A Smart Way to Build Credit

Most credit card issuers prefer applicants with a good credit score (preferably above 750). While some issuers offer entry-level credit cards for new-to-credit individuals, getting approval can still be challenging. If you’re struggling to get a credit card and want to start your credit journey, you can consider applying for a secured credit card.

Secured credit cards are issued against collateral, such as a fixed deposit. These cards function just like regular credit cards but usually come with basic benefits. The credit limit is assigned as per the fixed deposit’s value. Even students and unemployed individuals can apply for secured credit cards, making them a great option for building credit.

You can use secured credit cards for both online and offline transactions, just like a regular credit card. By paying bills on time, they can help you build a strong credit profile. In case of any default payments, the outstanding amount is recovered from the fixed deposit.

Instant Virtual Credit Cards in India

Virtual credit cards are digital versions of physical credit cards and work just like regular ones. With virtual cards, you can make online transactions and earn benefits such as rewards or cashback on your spends. A virtual credit card is issued electronically and all essential details—such as the card number, CVV, and validity—are accessible through your credit card issuer’s mobile app or website. While physical credit cards are usually delivered within 2–4 working days after approval, virtual credit cards are typically issued instantly. They often come with relaxed eligibility criteria, making them a convenient option, especially for new-to-credit consumers.