Credit Card

    Credit cards are basically cards made of plastic that are issued by banks that allow you to borrow money from them to make purchases     and pay for various services online as well as offline. Be it be buying a meal from McDonald’s or a flight ticket to Switzerland, you can use     your credit for anything that you like. As long as you repay the amount you borrow before the next billing cycle starts, you will not have     to pay any excess amount. Credit Cards are a boon for anyone who does not like to carry cash around

Understanding Credit Card Numbers

    There are 16 digits on every credit card. The very first digit present on a credit card signifies its system. 3 stands for travel or     entertainment car, 4 stands for Visa card, 5 stands for MasterCard and 6 stands for Discover Card.

    The card number structure varies by the system. For example a Diners Club card will start with 38, whereas, the American Express cards     will start with 37.

    American Express – The third and fourth digit specify the type and currency. Starting from the fifth digit till the eleventh digit is the     account number. From the twelfth digit till the fourteenth digit is the card number within the account. The fifteenth digit is a check digit.

    Visa – From the second digit till the sixth digit is the bank number. From the seventh digit till the twelfth digit or from the seventh digit till     the fifteenth digit is the account number. The thirteenth digit or the sixteenth digit is the check digit.

    MasterCard – The second and third digit, the second digit up to the fourth digit, the second digit up to the fifth digit or the second digit     up to the     sixth digit is the bank number. This depends if the second digit is 1,2,3 or anything other than that. The digits after bank number     up to the     fifteenth digit are the account number. The sixteenth digit is a check digit.

How to Use a Credit Card

    It is very easy to use a credit card. When banks issue a credit card, they create a revolving account for that card. Once the customers     receive their credit cards, they can use it to make purchases on credit. This credit is actually the amount that cardholders have borrowed     from the card issuer. They have to repay the outstanding amount at the end of every billing cycle. There is a limit on the amount of credit     that one can use and cardholders should make sure they don’t exceed this limit.

    To make payments using their credit cards, cardholders have to simply get their cards swiped at merchant stores and authenticate the     transaction by entering their PIN number. Some credit cards do not require you to enter a PIN number. If you are using your card to make     online payment, make sure the website is a secure one. Enter your credit card details on the checkout section and authenticate the     payment by entering the PIN or OTP (One Time Password).

Features of a Credit Card

    Banks offer amazing features on their credit cards. These features vary depending on the card provider and the type of credit card that     people purchase. Some of them are as follows:

    Accepted Globally – Today, most credit cards that are issued in India are international cards and are accepted by various merchants all     over the world.

    Balance Transfer – Credit cardholders can transfer the outstanding balance of their existing cards issued by one bank to the credit card     account of another bank. Doing so helps them in saving money and repaying the amount at a low rate of interest. Banks offer various     balance transfer options to their cardholders, which allows them to repay the amount on a monthly basis within tenure of their choice.

    Installment Payment Plan – Many banks offer the installment payment option to their cardholders. This feature allows cardholders to     convert their transactions into monthly installments. Cardholders can choose the tenure for their EMI plan. Generally, these plans have     very attractive interest rates. There are some banks that offer 0% installment payment plans to their customers.

    Loans on Credit Cards – Some credit cards offer pre-approved loans to their holders at low interest rates.

    Utility Bill Payment – Credit Cards have made it easy and quick for people to pay their utility bills. Using their cards, cardholders can pay     all their utility bills online at one go.

    Alerts – Credit cardholders receive bill payment reminders via SMS and e-mail from their banks every month, which helps them in not     missing out on their monthly payments.

    E-statement – Most banks today provide e-statements to their credit cardholders at the end of every billing cycle. Cardholders can access     this statement at any time online.

    Joining Fees – When customers apply for a credit card, they have to pay a certain amount for enrolment, known as the joining fee. There     are certain cards that do not have any joining fee as well.

    Annual Fees – Every credit cardholder have to pay a fixed amount to renew their card every year. This amount is called the annual fee or     renewal fee. This amount varies depending on the card that a person opts for. Some banks waive this fee for their customers for a period     of minimum 1 year as benefit for achieving certain spends milestone.

    Lifetime Free Card – There are some banks that offer lifetime fee credit cards, which means cardholders do not have to pay any annual     fee for these cards.

    Lost Card Liability – Many banks offer lost card liability coverage to their credit cardholders. This feature protects the cardholders from     fraudulent transactions that made using their cards after they have reported its loss to their card provider.

    Insurance Coverage – Some banks offer insurance protection on certain credit cards they offer. For example – travel insurance, life     insurance, etc.

    Cash withdrawal facility – Credit cardholders can use their cards to withdraw money from ATMs. Banks charge a small fee for the service     and cardholders can instantly avail money in any part of the world.

    24x7 phone banking Service – Banks offer 24x7 phone banking service to all their credit card holders. Some banks have a separate     helpline number for their cardholders. Cardholders can contact on this number to get any assistance related to their card. For example –     They can contact the department to avail concierge services, make card replacement requests, report loss of cards, etc.

    Credit Card Bill Payment – Banks allow their credit cardholders to pay their credit card bills online and offline. Cardholders can use NEFT,     Internet Banking, Cash, Cheques, etc. facilities to pay their bills.
    Benefits of a Credit Card

    Welcome Gift – Many banks offer a welcome gift to new credit card applicants once the card is issued to them. This gift can be in the     form of bonus points, gift vouchers, discounts, etc. The welcome gift differs depending on the card and the bank.

    Rewards Program – All credit cards generally have a reward program, which allows cardholders to earn reward points on every     transaction they make using their cards. The amount of points that cardholders can earn per transaction is fixed and differs from card to     card. The points that card members collect can be redeemed for various gifts that are listed in the rewards catalogue of the cards. These     gifts can be discounts, product, services, cash back offers, etc. Some credit cards allow card members to redeem their points against air     miles and cash as well.

    Fuel Surcharge Waiver – Many banks offer fuel surcharge waiver to credit cardholders when they spend specific amount of money on     fuel every month. This offer is available on fuel transactions made at all Indian petrol bunks.

    Cash back Benefits – There are certain credit cards that offer cash back benefits to the customers. The amount of cashback that will be     offered depends on the provider.

    Lifestyle Benefits – Cardholders can enjoy various lifestyle benefits on their credit cards. Lifestyle benefits include dining, shopping, golf,     wellness, entertainment, etc. privileges.

    Travel Benefits – This is one of the major reasons for credit cards being so popular among people. There are some credit cards that offer     amazing travel benefits to the customers. Travel benefits include air miles, airport lounge access, travel insurance, airline offers, hotel     offers, etc.

    Airport Lounge Access – Some credit cards offer complimentary airport lounge access to the cardholders. The offer varies from one bank     to another. Some banks put a limit on the number of visits, while some others allow access only to Indian airport lounges.

    Exclusive Privileges from Visa/American Express/MasterCard – Visa, MasterCard and American Express are three popular and     recognized credit card variants. Depending on the variant of your card, you can enjoy exclusive lifestyle, travel, etc. offers from     MasterCard/Visa/American Express.

    Add-on Cards – Many banks allow their credit cardholders to apply for add-on cards for their immediate family members. Most card     issuers offer add-on cards for free, but some of them limit the amount of add-on cards that one can apply for. Cardholders can enjoy all     the privileges of their primary cards on their add-on cards.

    Air Miles – Certain credit cards such as travel or Airline cards offer Air Miles to their customers. These miles can be JP Miles, Air India Air     Miles, etc. Cardholders can collect these miles and redeem them to avail flight tickets and other travel benefits.
    Credit Card Grace Period

    Most credit cards provide a grace period to the cardholders. Grace period is the time given to credit cardholders to pay off their credit     card bills without incurring any interest on the outstanding amount. Grace period is also known as interest free credit period. The time     period varies depending on the banks and the type of card. Generally, banks provide a minimum grace period of 20 days to their     cardholders, starting from the day they receive their credit card bills. In India, most banks offer a maximum grace period of 50 days.

Documents Required Applying for a Credit Card Online
    Applicants can submit any one of the ID proof, address proof and income proof documents listed below

Proof of Identity/ID proof    Proof of Address    Proof of Income (For Salaried)    Proof of Income (For Self-Employed)
⦁    Passport
⦁    PAN Card
⦁    Ration Card
⦁    Aadhaar Card
⦁    Voter’s ID Card
⦁    Driving License    ⦁    Telephone Bill
⦁    Electricity Bill
⦁    Passport
⦁    Ration Card
⦁    Rental Agreement
⦁    Aadhaar Card    ⦁    Salary Certificate
⦁    Recent Salary slip/s
⦁    Employment Letter    ⦁    Certified Financials
⦁    Recent ITR (Income Tax Returns) Statement
⦁    Audited Profit and Loss Statement or Balance Sheet
⦁    Proof of business continuity

    Note: Apart from the above mentioned documents, banks can ask the applicants to submit other documents, if required.