Do you Have an FD? Then You Can Get a Credit Card : Apply Today – Comprehensive Guide 2025

Get a Credit Card : Credit cards are commonly issued by banks based on a customer’s credit history. But did you know there’s another way to get a credit card, even if you don’t have a credit score or a strong financial record? Banks offer credit cards secured against fixed deposits (FDs).

These are known as secured credit cards, and they come with a host of benefits, particularly for those looking to build or improve their credit score.

Why Consider a Secured Credit Card?

Secured credit cards are a perfect solution for individuals with no prior credit history or a low credit score. By leveraging your fixed deposit, you can access a credit card that not only provides financial flexibility but also helps establish or rebuild your creditworthiness. Let’s dive deeper into secured credit cards, their benefits, eligibility criteria, and their key features in India.

What is a Secured Credit Card?

Secured credit cards are credit cards issued against a fixed deposit. The bank uses your FD as collateral to minimize financial risks. The credit limit on such cards is typically between 80% and 100% of the FD amount, depending on the bank’s policies.

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This makes it an excellent option for those who may otherwise find it difficult to get an unsecured credit card due to poor or non-existent credit histories.

Advantages of Secured Credit Cards

Secured credit cards offer several benefits, especially for individuals looking to enhance their financial standing:

1. Helps Improve Credit Score

Using a secured credit card responsibly can significantly boost your credit score. Timely repayment of dues and maintaining a healthy credit utilization ratio can help establish a positive credit history.

2. Low Financial Risk

Since the credit card is backed by your fixed deposit, the bank’s financial risk is minimized. This ensures that you are eligible for a credit card even if you have a low credit score or no credit history at all.

3. Transparent Credit Limit

The credit limit is directly linked to your FD amount. For example, if your FD is ₹50,000, your credit limit may range from ₹40,000 to ₹50,000, depending on the bank. This transparency helps you manage your spending effectively.

Eligibility Criteria for Secured Credit Cards

Before applying for a secured credit card, ensure you meet the following criteria:

1. Fixed Deposit in Your Name
   You must have a fixed deposit account with the bank where you are applying for the credit card. The FD acts as collateral for the card.
2. Stable Income
   While secured credit cards are more accessible, banks generally require the applicant to have a source of income, even if it is modest.

Key Features of Secured Credit Cards

Secured credit cards have unique features that make them a valuable tool for credit building:

1. FD-Linked Credit Limit
   The card’s credit limit is linked to the value of your fixed deposit. This ensures controlled spending and reduces the likelihood of overextending yourself financially.
2. Credit Score Rebuilding
   If you have a poor credit score, a secured credit card can help you rebuild it over time. Regular use of the card, combined with timely repayments, will positively impact your credit rating.
3. Minimal Risk for Banks
   Banks are more willing to issue secured credit cards because the associated financial risk is low, thanks to the FD collateral.

Drawbacks of Secured Credit Cards

While secured credit cards are an excellent tool for building credit, they have some limitations compared to regular, unsecured credit cards:

• Fewer Offers: Secured credit cards often come with fewer rewards and benefits, such as cashback, travel perks, or dining discounts, which are commonly offered by regular credit cards.
• Limited Spending Power: The credit limit is restricted by the FD amount, which may not be sufficient for individuals looking for higher credit limits.

How to Make the Most of Your Secured Credit Card

To maximize the benefits of your secured credit card, follow these tips:

1. Timely Payments
   Ensure you pay your credit card dues on or before the due date to avoid penalties and improve your credit score.
2. Maintain a Low Credit Utilization Ratio
   Try to use less than 30% of your credit limit to demonstrate responsible financial behavior to credit bureaus.
3. Upgrade to an Unsecured Card
   Once your credit score improves, you can request the bank to convert your secured card into an unsecured one, offering greater rewards and benefits.

Get a Credit Card – Conclusion

Secured credit cards are an excellent financial tool for individuals with low or no credit scores. By leveraging your fixed deposit, you can access the benefits of a credit card while simultaneously rebuilding your credit history. However, it’s essential to choose a card that aligns with your financial goals and lifestyle.

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While secured credit cards may lack the extensive rewards and benefits of regular credit cards, they provide a much-needed stepping stone for individuals looking to establish financial stability. If you have a fixed deposit, don’t wait—apply for a secured credit card today and take the first step toward a better financial future!

Disclaimer

The information provided in this guide is for educational and informational purposes only and should not be considered as financial or legal advice. Credit card issuance against a fixed deposit (FD) is subject to the terms and conditions of the respective bank or financial institution. Eligibility criteria, fees, and benefits may vary depending on the issuer. Readers are advised to thoroughly research and consult with the bank or a financial advisor before applying for a credit card. The author and publisher are not responsible for any decisions made based on this guide.