A credit card is a payment card issued by various banks with a limit line of credit to the card holders. This credit is an additional facility which can be availed by users to transact (buy) on their goods and services. While issue of credit card the two parties (credit card issuer and user) enters into an agreement at certain terms to use the available limits and re-pay within the allowed time limits. Card issuer sent a statement every month indicating the details of purchases, outstanding fees etc. which user need to review and pay before the last date to avoid any penalties.

There are many credit cards which require annual fee and in return it offers very good reward program while few credit cards are available with no annual fee.

Basically identity proof (photo id), address proof and income proof documents are required to issue a credit card, the requirement may vary depending on the credit card issuing authority. Typically these documents includes Pan card, driving license, Voter ID, Passport, aadhar card, utility bills, bank statement, rent agreement, salary slip and income statement issued by employer.

Note: Please be aware while submitting your documents to avoid misuse.

  1. Always mention a note “For issue of XYZ bank credit card only” with your signature.

Always fill the complete form by yourself to avoid any mistakes.

Advantages using a credit card:

Cashback savings: There are certain cards which offer cashback and allow you to get some money back each month. These small earnings can use the money that you gain, to pay off extra money from your expenses. It is necessary to pay back the credit card balance in full if you want to take advantage of the cash back otherwise you will pay more in interest than you gain from the cash that you get back.

Interest free credit: All credit cards provide interest free credit. You can pay for the items from your credit card and you don’t need to pay back until up to 50 days. During this free credit time period, you can put the money (you plan to make the repayment) to a flexible savings or fixed deposit account that has instant access. Then you can gain some interest on the money until you need to use it to pay the card.


Get Cash: All credit cards are provided with PIN to withdraw cash (if required), this is add on which can be used in case of emergencies. But it is worth remembering that the interest on a credit card is likely to be a lot higher than a loan, so depending on the situation you should consider whether this is actually a good idea.



Proactive planning: Tips to prepare before you apply for a credit card,

  • Know and enhance your credit score.
  • Reduce your debt.
  • Include all of your income in the application.


We hope that this article will help you to have a basic idea of credit card. In the next session we will post about the type of credit cards, different credit card issuers and tools to manage credit card spending.





26 thoughts on “Credit Cards (Tips & Tricks) #1

  1. Credit card frauds are on peak. Every month I receive such fake calls which claim to be from “central credit card company” or ATM card provider company. Sometimes I just laugh and sometimes I really shout on them. So many innocent people falls for such calls


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