Best FD Based Credit Card In India-2024

Fixed-deposit (FD) secured credit cards provide a special combination of enticing features and monetary security. These cards are intended for people who have a fixed deposit with a bank and want to use it as security to get a credit card with good terms. They are a great choice for people whose income or credit history prevents them from being approved for unsecured credit cards.

Low interest rates, quick approval procedures, and reward opportunities are just a few advantages of FD-based credit cards. For managing finances and establishing or improving credit profiles, this makes them a sensible option. The best FD-based credit cards, its features, and advice on maximizing rewards with these safe financial instruments are all covered in our list.

Top 4 Best FD Based Credit Cards?

1. IDFC FIRST WoW Credit Card
2. SBI Unnati Credit Card
3. IDBI Bank Imperium Platinum Credit Card
4. SBI Student Plus Advantage Credit Card

1. IDFC FIRST WoW Credit Card

The IDFC FIRST WoW Credit Card delivers a premium credit card experience with a focus on rewarding flexibility. It's perfect for people who spend a lot of money because it gives up to 5% cashback on all transactions. New cardholders can enjoy a welcome benefit of 5% cashback, up to ?1,000, on their first EMI transaction completed within 90 days of activation. The card also provides attractive dining and health discounts, including up to 20% off at over 1,500 restaurants and 15% off at 3,000+ health and wellness outlets. With no joining or annual fees and comprehensive insurance benefits, this card is a great choice for users seeking value and rewards.

• Joining Fee: ?0
• Renewal Fee: ?0
• Best Suited For: Users seeking high cashback and flexible rewards
• Welcome Benefits: 5% cashback up to ?1,000 on the first EMI transaction within 90 days of activation

2. SBI Unnati Credit Card

The SBI Unnati Credit Card is a secured credit card offering exceptional value for those with a fixed-term deposit with SBI. It earns 1 reward point per ?100 spent, which can accumulate quickly. The card includes a milestone reward of ?500 cashback for spending ?50,000 within a year. There is no yearly fee for the first four years, which makes it an affordable choice. Cardholders also benefit from a 1% fuel surcharge waiver on transactions between ?500 and ?3,000, capped at ?100 per statement cycle. This card is tailored for those looking for a budget-friendly credit card with practical benefits.

• Joining Fee: ?0
• Renewal Fee: ?500
• Best Suited For: Customers with SBI fixed-term deposits looking for a cost-effective rewards card
• Welcome Benefits: No annual fee for the first 4 years

3. IDBI Bank Imperium Platinum Credit Card

The IDBI Bank Imperium Platinum Credit Card is designed for users who value high rewards and comprehensive protection. It offers 2 Delight Points for every ?150 spent on shopping, travel, and movies, with additional bonuses for early spending. New cardholders receive 500 Delight Points on spending ?1,500 within the first 30 days and an extra 300 points on transactions between 31 to 90 days. Fuel transactions benefit from a 1% waiver, up to ?300 per month. The card also includes zero lost card liability, providing added security. With a modest joining and renewal fee, it’s a great choice for frequent spenders who seek rewards and safety.

• Joining Fee: ?499
• Renewal Fee: ?499
• Best Suited For: Users looking for high reward points and added security
• Welcome Benefits: 500 Delight Points on spending ?1,500 within the first 30 days

4. SBI Student Plus Advantage Credit Card

Delivering useful advantages and financial management features, the SBI Student Plus Advantage Credit Card is tailored especially for students. Upon paying qualifying utility bills, cardholders can receive 2.5% cashback and transfer outstanding balances from other credit cards at a reduced interest rate. On gasoline sales between ?500 and ?3,000, the card additionally offers a 2.5% waiver. Being accessible and affordable, there is no yearly fee if you spend ?35,000 in a year. You can exchange reward points for gifts and vouchers at a rate of one point for every ?100 spent. For young people who are managing their funds, this card is ideal.

• Joining Fee: ?0
• Renewal Fee: ?0
• Best Suited For: Students and educational loan borrowers
• Welcome Benefits: 2.5% cashback on eligible purchases

What is a credit card that is secured by a fixed deposit?

A fixed deposit account is used as collateral for a secured credit card, known as a secured credit card secured by a fixed deposit (FD). You can't get this credit card unless you already have a fixed deposit (FD) with a bank; this serves as security for the credit card company. This kind of credit card is provided by banks such as SBI and SBM Bank (India).

The key feature of this card is that the FD linked to it is marked as collateral, meaning it’s reserved to cover any outstanding dues. Typically, the credit limit on this card ranges from 80% to 90% of the FD amount. Importantly, even though the FD serves as collateral, it continues to earn interest as usual.

If the cardholder fails to make the required monthly payments, the bank has the right to redeem the FD to recover the unpaid amount. Generally, credit cards secured by fixed deposits come with lower fees and charges compared to unsecured credit cards, and they are easier to obtain. This type of card provides a secure way to build or improve credit while benefiting from a lower interest rate and fewer charges.

Features of Secured Credit Cards?

• Relaxed Eligibility Criteria: Secured credit cards are easier to obtain than unsecured ones because they are backed by a fixed deposit. The bank uses this deposit as collateral, reducing its risk. This makes the approval process less strict, even for those with low or no credit history.
• Interest on Fixed Deposit: The fixed deposit used as collateral continues to earn interest until it matures. Some banks offer this benefit to secured credit card holders, allowing them to earn interest while using the card.
• Builds Credit Score: Just like regular credit cards, transactions made with a secured credit card are reported to credit bureaus. This helps users build or improve their credit score over time, especially for those with no previous credit history.
• Credit Limit Based on Deposit: The credit limit is directly linked to the value of the fixed deposit. Usually, the credit limit is set between 80% to 90% of the deposit amount, ensuring that the bank is protected in case of non-payment.

Benefits of Credit Cards Against Fixed Deposits (FDs)

Credit cards linked to fixed deposits (FDs) offer several appealing advantages for cardholders.

1. Easy Approval: One of the standout benefits is the straightforward approval process. These credit cards are accessible without the need for income verification, a high credit score, or an extensive set of documents.?
2. Credit Building: Since banks report your payment behavior to credit bureaus, it’s a great tool for establishing or enhancing your credit profile over time.
3. Lower Costs: Generally speaking, these credit cards have less fees and interest rates than standard credit cards. The reduced risk for the bank, due to the FD collateral, allows them to offer more favorable financial terms to the cardholder.
4. Interest Earnings: While you benefit from the credit card features, your FD continues to earn interest. This ensures that your funds are working for you, even as you enjoy the perks of having a credit card.
5. Access to Features and Rewards: Credit cards against FDs offer a range of features and rewards similar to those of regular credit cards. These can include cashback, discounts, and lounge access, allowing you to enjoy various perks while keeping your finances secure.

What are the Eligibility Criteria for Getting a Credit Card Against FD?

There are requirements that must be fulfilled in order to be eligible for a credit card secured by a fixed deposit (FD) in India. This type of credit card is available to individuals who hold a fixed deposit with the issuing bank. Here’s a clear breakdown of who is eligible:

• Individual Residents: Only resident individuals who have a fixed deposit with the bank can apply for this credit card.
• Age Requirement: Applicants must be at least 18 years old. Minors are not eligible.
• Fixed Deposit Criteria: The FD must not be marked as a lien, meaning it cannot be tied to an existing loan or overdraft.
• Ineligible Parties: The following groups are excluded from eligibility:

In summary, to obtain a credit card against an FD, the applicant must be an individual resident with an eligible FD and must meet the age and FD status requirements. Certain entities and types of deposits are not accepted for this credit card facility.

How to Apply for a Credit Card Against FD

It is simple to apply for a credit card with a fixed deposit (FD), but there are steps that must be followed. Here is a guide to assist you:

1. Verify Your Eligibility: Make sure you fulfil the requirements, which include the type of FD and your age. The FD needs to be with the issuing bank and shouldn't be noted as a lien.
2. Go to the Bank: Proceed to the bank branch where your savings account is kept. For information on online applications, you can also go to their website.
3. Send in your application: Completing the credit card application is necessary. You will be required to submit personal information and facts about your FD.
4. Provide Documents: Please send in the necessary paperwork, which usually consists of your FD receipt, identification documentation, and proof of address. Additionally, some banks would need a current photo ID and evidence of income.
5. Verification: Your documentation and FD details will be checked by the bank. They might also check your credit.?
6. Receive Card: The credit card associated with your FD will be issued by the bank upon approval.

Documents Needed for a Credit Card Against FD

In order to apply for a credit card with an FD, you must submit the following paperwork:

• Valid government-issued identification, such as a driver's license, passport, or Aadhar card, serves as proof of identity.
• Proof of Address: Records attesting to your present address, such as utility bills, rental agreements, or bank records.
• Fixed Deposit Receipt: Documentation of the FD containing the amount and date of maturity.
• Photograph: You might need to provide a current passport-sized photo.
• Proof of Income: Income statements or recent pay stubs may be required by certain banks.

How to Get the Best Rewards with FD-Based Credit Cards

Use these tactics to get the most out of a credit card secured by a fixed deposit (FD) and maximise your rewards:

1. Recognise Reward Categories: A variety of incentives are available on different FD-based credit cards. While some would give cashback, others might give reward points for particular purchases, travel, or dining experiences. Examine your card's reward structure to find out where you may make the most.
2. Apply the Card to Daily Costs: Make regular purchases with your card to expedite the accumulation of rewards. Make sure you only use it for purchases that your card issuer has designated as high-reward categories.
3. Monitor and Make Use of Offers: Credit card issuers frequently provide exclusive deals and promotions, such as extra cashback or bonuses, for making purchases in particular categories or during specific times. Pay attention to these deals and allocate your money appropriately.
4. Pay Off Your Balance in Full: Pay off your balance in full each month to avoid incurring interest fees. This makes sure that interest charges don't take away from the benefits you receive.
5. Use Prizes Wisely: Take care to comprehend when and how to use your incentives. Certain credit cards provide greater value when used to redeem points for particular uses, such as gift cards or vacations.
6. Keep an Eye on Your Spending: Verify your rewards balance and credit card bills on a regular basis. This keeps you on track to earn and use incentives and makes sure you don't lose out on any advantages.

Tips to Use Your Credit Card Effectively

You may improve your financial management, establish a favorable credit history, and take advantage of a number of other advantages by using your credit card wisely. To make the most of your credit card, consider these useful suggestions:

1. Pay Off Your Entire Balance: Pay off your bill each month to avoid paying interest. By doing this, you may prevent debt from building up and keep your credit score high.
2. Pay Your Bills on Time: To make sure you never forget a deadline, set up automatic payments or reminders. Making your payments on time helps you stay away from late fees and bad credit effects.
3. Make Use of Rewards and Benefits: Make use of any discounts, cashback, and reward points that your card may provide. Keep an eye out for any promotional deals, and use your card for the purchases that yield the highest points.
4. Maintain a Low Credit Utilization: Try not to use more than thirty percent of your credit limit. Excessive credit utilisation is an indication of financial distress and can lower your credit score.
5. Regularly check your statements: Verify any mistakes or unauthorised charges on your statements. Frequent monitoring enables you to identify disparities early and take appropriate action.
6. Assign a Budget: Keep your credit card usage within the confines of your spending plan. To make sure you're not overspending and to keep your finances under control, keep track of your spending.
7. Recognise Fees and Charges: Get acquainted with the costs linked to your credit card, such as interest rates, annual fees, and foreign transaction fees.
8. Put Notifications and Alerts to Use: To be informed about your spending and upcoming payments, turn on transaction notifications and due date reminders.

Conclusion?

In summary, fixed deposit credit cards offer a convenient and affordable approach to handling money and accruing rewards. There is an FD-based credit card that meets your needs, regardless of whether you're searching for significant cashback, worthwhile reward points, or exclusive advantages catered to your requirements.

Cardholders can have secure credit and excellent benefits by learning about each card's attributes and using smart strategies to maximise rewards. These credit cards are a useful addition to your financial portfolio because they are convenient and aid in the establishment of a positive credit history. To increase your purchasing power and take advantage of the benefits that come with it, select the best credit card based on FDs.

FAQs

Q1. What is a credit card that has a fixed deposit as collateral??

Ans: A fixed deposit (FD) is used as collateral for the credit limit on a credit card secured by it. This indicates that the credit card issuer uses the FD as security. Despite being designated as collateral, the FD is still earning interest. The bank may redeem the FD to settle the outstanding balance if the cardholder defaults on the payment.

Q2. What advantages come with a credit card that is FD-based??

Ans: Compared to unsecured cards, FD-based credit cards have easier approval processes, cheaper interest rates, and fewer fees. They contribute to the establishment of credit history, and the FD's ongoing interest income adds to its financial advantages.

Q3. Which documentation is needed in order to apply for a credit card with an FD??

Ans: The following documents are required: an FD receipt, a recent photo, evidence of address (utility bills, rental agreement), proof of identity (Aadhar card, passport, or driver's license), and occasionally proof of income.

Q4. How can I get the most out of my FD-based credit card rewards??

Ans: Paying off your debt in full to prevent interest charges, keeping an eye out for special offers, using your card for regular purchases in high-reward categories, and strategically redeeming points based on the best value available are all ways to optimise your rewards.