credit card

You may have heard of horrifying stories where people lost their family members or couldn’t secure admission to their dream college just because they were not able to secure credit on it. But not anymore, a credit card is one such facility that helps you make your financial journey hassle-free by providing short-term interest-free credit up to a pre-specified limit hence clearing all the financial hurdles between you and your dreams. If you wish to know more about what is a credit card is before you apply for the best credit card in India, then you are at the right place. In this article, we will explore the basics you need to know about what a credit card is. So, let’s start :


A credit card is one of the facilities offered by banks and other financial institutions. It comes in the form of a plastic or metal card which can be used by customers to get short-term interest-free credit up to a prespecified credit limit. The credit limit is calculated on the basis of individual credit scores, earnings, and other relevant factors. Note that, if a customer fails to credit on time, a high-interest rate is changed on the pending amount.

Specialized Types 

  • Business Credit Cards: A business credit card is a credit card, specially designed to be used by businesses rather than for individual personal use. As business credit is different from personal credit, it is based on your business’s financial history and is tied to your social security number.
  • Secured Credit Cards: The credit card that requires a cash deposit when you open the account is known as a secured credit card. The cash deposit reduces the risk of the card issuer. If you fail to pay the bill, the card issuer can take money from your deposit. These credit cards are mostly offered to people with bad credit or no credit. 
  • Prepaid Credit Cards: A credit card in which money can be loaded in advance, which can be later used by you for spending is known as a prepaid credit card. A prepaid credit card is not linked to your bank account.
  • Digital Credit Cards: The credit cards which are available only in the online format are known as Digital Credit Cards. They are designed only to perform only online transactions.
  • Charge Credit Cards: The charge credit card is a type of credit card used for electronic payment. It charges no interest but requires you to pay the statement balance in full, usually monthly.

Features and Benefits

  • Fraud Protection: The Fair Credit Card Billing Act protects you from fraud by prohibiting credit card companies from holding you responsible for unauthorized purchases on your credit card if you report it stolen before the thief uses your credit card.
  • Rewards: Different types of credit cards offer different types of reward programs to you depending upon the card you are using. The most common rewards are cashback and reward points. The cashback is actual cash that you get as a certain percentage for every qualifying purchase back. The reward points are points in return for every qualifying purchase made using the card. The points can be redeemed for various offers ranging from gift vouchers, merchandise, and many more.
  • Build Credit History: A credit history is a record of your ability to repay debts. As credit card issuers typically report your account and activity to national credit bureaus, it helps you build a credit history. Good credit history can be used by you to secure easy loans from banks and other financial institutions.
  • ATM Cash Withdrawal: A credit card can be used to get a Cash Advance. A cash advance stands for the process of credit cards that allows you to withdraw cash from an ATM. However, if you obtain a cash advance at an ATM, you will be charged a cash advance fee.
  • Easy and Instant Approval: You can easily apply for a credit card online or offline. If you apply for a credit card online, you can get instant approval, i.e you receive a quick decision typically within a few minutes.

No matter at what stage you are in your life today, you will find at times you have to look for credit with no option left. These are the times when a credit card just like a true friend acts as a savior for you. We wish all the best to all the future credit card holders, hope it will help you make your financial journey hassle-free. All the best!


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