Feb 22, 2023
Credit cards are convenient and easy. They offer quick short-duration loans with an interest-free period to repay outstanding bills. They also come in various forms, with banks and financial institutions in India offering several types of credit cards to meet your specific requirements. Each type is suited to specific individuals and their financial needs.
Depending on your needs, you can determine which credit card works for you and apply for it. This article covers the six common types of credit cards available in India.
1. Standard credit cards
Standard credit cards serve the needs of most credit card users. They offer pre-approved short terms loans (via multiple transactions in a defined period) to meet your immediate expenses and essential purchases. In addition, they also come with attractive rewards and offers on daily purchases, including merchant offers, and discounts.
IDFC FIRST Bank Classic Credit Card is an example of a regular credit card. If you are a first-time applicant, the Classic Credit Card is a viable choice because it comes with a low-interest rate. The card combines convenience and security, along with incentives such as reward points and fuel surcharge waivers.
Like most regular credit cards, it offers discounts on specified brands and e-commerce platforms, complimentary airport/railway lounge access, fuel price waivers, personal accident coverage, and free roadside assistance to bail you out from a tight spot.
2. Cashback cards
Several credit card issuers provide cashback and rewards on your card expenses as loyalty benefits. In most cases, you have to redeem these rewards within a defined period to avail the benefits and additional discounts. As a cashback credit cardholder, you save money on shopping, movie tickets, travel bookings, and dining at popular restaurants. With IDFC FIRST credit cards, your reward points never expire, making it an ideal choice for those piling up the points to tick something big off from your wishlist.
3. Co-branded credit cards
Banks tie up with brands and merchants to provide bespoke privileges and offer exclusive expense benefits through their credit cards. Co-branded cards are ideal when you have a specific type of usage like travel and hotel booking, online shopping, movie tickets, etc.
For instance, a travel co-branded credit card offers exclusive privileges for frequent travelers, including extra air miles, discount on flights, dedicated check-in desks, increased baggage allowance, free lounge access and more.
4. Premium credit cards
Premium credit cards are designed to offer luxurious experiences and access to a series of lifestyle privileges to users.. Usually, they have higher annual charges and membership fees but compensate them with high credit limits and spending limits, wider privilege and benefit horizons and lower charges on activities like forex charges, international travel, among others.
Additionally, some premium credit may also provide super saver features such as no interest on cash withdrawals, no penalties for exceeding the credit limit, and no fees for reward redemption.
5. Super Premium credit cards
Banks offer Super Premium credit cards for HNIs (High Net Worth Individuals) who prioritise luxury and comfort. These cards provide a free lounge and spa access at international and domestic airports, minimal forex markup costs, air accident and personal accident coverage, and complimentary lost card liability along with travel insurance. These cards have significantly higher credit limits and are usually only available by invitation.
6. Business credit cards
A commercial/business card is perfect if you want a credit card to meet business operating expenses. You can save money on work travel and expenses while effortlessly managing payments for goods.
However, while some cards are not reported to credit bureaus in the business owner's name, eligibility can still be based on the business owner's credit. The card may also include a personal guarantee, which means you are liable for the debt if the company fails to pay off the balance.
With so many different types of bank cards available, it is critical that you carefully select your card by understanding the terms and conditions and reading between the fine lines. Before applying for any credit card, ensure you meet the eligibility and choose a card that aligns with your financial requirements.