Everything You Need to Know about Secured Credit Cards

Also called secured credit cards, FD credit cards are a unique solution to the eligibility issue for the credit card application process. With this card, you can enjoy the benefits of a regular cards without a strong credit history. 

This way, it helps you get funds during an emergency as it is easy to obtain against your FD account. Additionally, it opens the door for reward programs and discounts. However, it is important to understand the functionality and how it differs from a regular credit card to know if it’s an ideal option for you.

How to Apply for a Secured Credit Card

The process to get a credit card against your fixed deposit is similar to availing of a normal credit card, but it is relatively simpler. You can get access to an FD-backed credit card even if you don’t meet the qualifying criteria of a 750+ credit score. Applying for this card is the right option if:  

• You are a student or don’t have a credit history at all
• You have a low credit score
• You don’t qualify for a traditional credit card 
• You are a seasonal worker or freelancer and don’t have regular income proof
• You are a senior citizen or a homemaker with a low or irregular income 

Note that issuers check your credit footprints, so as a new income earner, you may not qualify for a regular credit card. In that case, an FD-backed credit card can be a fantastic option. You can build your credit history while enjoying credit card features. 

Additionally, these cards are backed by collateral, which reduces the risk for lenders. As such, you can enjoy lower interest rates compared to traditional cards. You also get the liberty to decide your credit limit, as it is 70% – 90% of your deposit amount.

If you already have a fixed account, you can apply for a secured credit card by following these steps.

• Apply on your credit card provider’s official website or by visiting the nearest branch
• Fill out the form with the necessary details 
• Submit the documents as an existing customer to the card provider
• Follow the verification process to get your card

What If You Don’t Have a Fixed Deposit Account

You need a fixed deposit account to avail of a secured credit card. If you don’t have a fixed deposit account, you can open one with minimal process.

• Visit your nearest bank 
• Make sure you qualify as per the eligibility criteria like:
  • You should be a resident of India or an NRI
  • You should be 18 or above
• Submit the required documents such as:
  • Identity proof
  • Address proof
• You can opt for an online option if your bank has an official website or mobile app

After your fixed deposit account gets activated, you can ask your credit card provider to send you the application for a secured credit card. 

Why Apply for a FD- Backed Credit Card

Here is a quick overview of why and when this type of card is a great option.

• You can get access to FD credit cards regardless of your geographical situation
• While being an affordable option, you can enjoy perks similar to regular credit cards, like cashback and reward programs
• You can enjoy your investment as you continue to get interest on your fixed deposit while enjoying the benefit of a credit card
• Most credit card providers give an interest-free period of 48-55 days
• You can use your secured credit card to build a credit history, which can be beneficial to getting loan approval in future 
• You can switch to a regular credit card if you pay on time without default
• You need minimal documentation to avail of a secured credit card
• An FD-backed credit card comes with much lower interest rates in comparison to a traditional credit card
• You can avoid debt accumulation, as the lender will collect the outstanding dues from your fixed deposit in case of default 
• You can enjoy zero annual fees and joining fees, depending on your credit card provider
• You can increase your credit limit by increasing your fixed deposit amount, making it a flexible option
• You get a credit card with an attractive rewards
• You can enjoy a convenient and quick application process if you already have a fixed deposit account

The FD-backed One Credit Card  can be a fantastic option if you want to get a fixed deposit credit card. This premium metal card lets you earn 5X rewards on your top 2 spending categories each month. Enjoy lucrative offers on travel, grocery, retail, fashion and more without any annual or joining fee. 

Wondering how to know credit card balance and other details? Use the One Credit Card App to keep track of all your bills and latest offers. Built on full-stack technology, it also allows you to check offers near you with GPS. Apply now and enjoy all these benefits and more.