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About Credit Cards

What is a Credit Card?

Tired of paying by cash? Would you want interest free loan for 50 days?

Credit cards are a convenient alternative to cash or cheque-based transactions issued by banks and financial institutions, enabling the holder to make a purchase on credit. The due amount at the end of the billing cycle may be paid as a lump sum within the due date The purchases that are made using a credit card are in fact short term unsecured  loans and if paid off within a specified time (interest free period) do not have any interest payouts. Additionally, credit cards allow you to benefit from the option of revolving credit i.e. you might pay off your credit card dues in one go or make multiple small payments to pay off your debt
Credit cards allow you to pay for goods and services using the bank’s money instead of your own. But this is only for a short period of time because if you fail to pay back the money before the end of your interest-free period, you will be charged interest on the amount you owe to the bank.

Am I eligible for a Credit Card?

Following are the general eligibility conditions for a credit card:-


• No less than 18 years old at the time
• Either salaried or self employed (Salary proof/ acknowledge ITR required)
• Have at least one savings account in an Indian Bank
• Have a valid Indian address
• Qualify the minimum income requirement set by the card issuer etc.

What are the key charges applicable to credit cards?

• Joining fee – paid at the time of purchasing a credit card
• Annual fee- pre- specified amount paid annually by people having credit card
• Duplicate statement fee- a fixed sum charged on getting a duplicate statement in physical form
• Late payment charge – it is a penalty to be paid over and above the interest charges, if the payments are not made in a timely fashion.
• Cash withdrawal- an interest is charged on withdrawal of cash against the credit card
• Service Tax- service tax is charged on the expenses made using a credit card which depends on the total value of the transaction inclusive of interest, fees and other charges
• ECS or cheque return charge- a fixed amount is to be paid by the card in case of ECS transfer failure or cheque bounce
• Foreign currency transactions- for the transactions made overseas, a pre-defined percentage of transaction value subjected to a minimum amount is to be paid to the credit card issuer.
• Over-limit fee- It is the fee charged when your purchases, finance charges or fees exceed your credit limit.

 What is an Annual Fee?

An annual (yearly) fee in charged by a credit card company each year for use of a credit card. This fee varies from one card to another and may be waived off by the bank in case your card agreement contains a waiver clause on achieving a specific annual expense threshold.  There are also a number of credit cards available that have zero annual fees.

 How does the card issuer decide my credit limit?

Credit card is a short term unsecured loan and therefore the limit of the loan is assigned in line with the underwriting norms of various issuers basis age, income, credit history etc.

 What happens if my card expenditure exceeds my assigned credit limit?

If your credit card purchases/cash advances exceeds your assigned credit limit (inclusive of retail purchases, cash advances, fess, and other charges), an over limit fee plus applicable taxes will be charged to your credit card account.
Can I increase my credit limit later on?
Yes, it is possible. In this case card member seeking to have their credit limit increased can put a request with the card issuer. Additional documents such as those declaring income may need to be submitted with the card issuer to complete process. The Bank at its sole discretion and based on such documents provided, may increase choose to increase the credit limit. Previous repayment history of loans and credit card dues of the card holder would also play a major role in the card holder’s decision.

How are they different from debit cards? 

The money that you draw from a Debit card is your own money lying in the bank account. The same can be used either to withdraw cash or swiped on POS machines (outlets) to make payments. Your bank account is immediately debited by the commensurate amount that you withdraw/shop for.

What is the difference between VISA card and MasterCard?

 Visa and MasterCard are global payment companies that connect consumers, businesses, banks and governments across countries and territories, enabling them to use digital currency instead of cash, checks, drafts, etc.  Apart from VISA and MasterCard, other leading global payment technology companies are American Express, Diners Club and Discover. Rupay- a homegrown payments platform has also emerged in the recent past.

What are the different types of credit cards?

Credit cards come in all shapes and sizes.  From plain vanilla cards which come with minimum features and low on fee/free to others which come with elaborate features ranging from travel, dining, shopping, lifestyle benefits etc.

 How does the new EMV chip and PIN system for credit cards work?

EMV – which is short for Europay, MasterCard and Visa , a global standard for cards equipped with the chip and PIN technology. The chip card and PIN code need to be used together to authenticate chip-card transactions. Unlike magnetic-stripe cards, every time an EMV card is used for payment, the card chip creates a unique transaction code that cannot be used for another transaction. EMV technology provides an additional layer of security in point of sales (POS) transactions to prevent credit card frauds.

 What is the CVV number?

CVV Number (Card Verification Value) is a 3 digit number mentioned on back side of your credit card on the right side of the signature panel. Also known as the CVV2, this 3 digit number is an essential part of the verification process especially in case of online transactions. The CVV number should not be disclosed to anyone.
How long does it take to apply for and receive a Credit Card?
Moneyzguru can help you decide on the credit card of your choice. A Monyeyzguru agent will meet you at your doorstep for paperwork and subsequently the card will reach you in 7-14 working days.
What is the difference between a Credit Card and a Charge Card?
A charge card requires you to pay the outstanding amount every month and not roll over the balance forward whereas a credit card offers you option to pay outstanding amount in small payments.

What is a supplementary/add-on card?

Add on cards are allotted to family members of primary card holder and share the total credit limit of the primary card account and have the same features as the primary card. Any reward points earned through the add-on card(s) are credited to the primary card account.
How many supplementary cards can I have and what are the charges involved?
Though this varies from one credit card issuer to another, in most cases, you can apply for up to 3 supplementary cards for family members like your spouse, children, parents and siblings.

What to do if I lose my card or if my card is stolen?

Have the card blocked immediately by calling the issuer- call center. Card lenders tend to provide limited liability to customers post intimation of a card theft/loss

What are reward points and how can I use them?

Reward points are offered by card issuers commensurate to the spends done on the credit card. These reward points can be exchanged in to buy items listed by card issuers in the rewards catalogue/ adjusted with cashback.




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