What is a Credit Card?

               Credit card is a financial instrument issued by the financial institutions, which lets you borrow funds to pay for your purchase of goods and services with a predefined limit to it. The limit is set by your financial institution based on your credit score and history. The better you handle your expense and pay on time, the better is your credit score. Which helps you to get a higher credit limit. In credit card, the thumb rule is you should repay the amount borrowed on time with any fail! If you fail to do so, It Could result in interest charges on you by financial institutions. 

Most people think credit famous for reward points and discount they offer on your expense, But the best feature they offer is security against any fraud happening to you. When you start using credit card, the money is deducted from card issuer rather from your account. If any fraud happens you need to worry issuer will take care of it. In case of debit card it works other way where your account has less security than credit card.

Why should I purchase a credit card?

               Well, you may question that I already have a debit card. Why should I even get a credit card? Think this way, you always chose the best of many things. Because the best has the best features than the rest of the peers in any field. The same applies here, credit cards offer better features to people than debit cards. Let’s look into the comparison between the Credit card and Debit Card, then I will let you decide which is better for you.


Debit Card

Credit Card


Deduct money directly from your bank account.

Deduct money from your Credit card issuer. 


You can only spend how much you have.

Can spend more than what you have.


Exposure to your account is higher, thus security is less compared to credit card.

Less exposure to your account, thus highly secure.


There is no bill or statement for debit cardholders.

You get a statement each month with details of the transactions you have made.


Annual fees are applicable and the fee varies from one bank to another.

Credit cards have multiple fees applicable. These include joining fees,
annual fees, late payment fees, and bounced cheque fees etc.


There is no interest that is charged.

Interest is charged on the outstanding amount if it hasn’t been paid by the due date.


Rewards are either very low or nothing.

Get to enjoy cashback, Offers, and reward points which can be redeemed.


Protection from theft or loss of the card is minimal.

Most cards offer 100% lost liability protection. So, you are not liable for any
unauthorized transactions made.

How do credit cards work?

               Let’s understand how credit cards actually work when you buy a credit card and use it to do your daily transaction. The deducted amount is not from your bank, rather from the issuer(Banks). But can you spend as much as money? No, there will be a limit for it which is set according to your age and salary. As you do the transaction, the available credit reduces for every purchase you make, and it gets restored when you repay the amount in the time period. 

This is more of the TRUST you build with the card issuer which helps you increase the credit  scores that internally help you in many ways to get a loan for your new business,  and for even purchasing an apartment.  There is a saying “Trust is the most expensive thing” when you build that trust with your card issuer it will only help in a better way in the future.


               Credit score is a summary of your credit history which reflects the creditworthiness of you for the all the money you borrowed and repaid. Credit scores tell how good and risky you are for lenders to lend you money. That gives lenders the potential risk summary while lending you money for a period of time. Credit score is given for individuals as well as for companies which impact to attract investment from big institutions. Credit score generally range from 300-900 points.
Note: If you like to know more about the credit score, what exactly it is and who does it actually work in India. Please have patience, I will get that for you in some time.

What are the types of credit cards?

               In India, we have plenty of credit cards which serve with specific features depending on different card issuer in India. All credit cards are introduced aiming to serve or give better experience to their customers. The names of credit card varies from one to another credit card issuer, They decide what card should have which feature and the name. Name basically for marketing to reach more people. You see normally people think gold is better than silver, and platinum is better than gold, off course I am not denying the platinum credit card come up with better features than gold, my point was when you are buying any credit cards. It’s not about the name, rather features which suits you the most in daily life. If you’re a person who eats food lot outside than you should look for the credit card which better give offers at hotel and restaurants. Similarly, for shopping and travelling etc. Now that we know something about credit cards, Let us check different credit cards available in India.

Reward Credit Card

               Rewards credit cards offer you some type of “reward” typically cash back, points for every rupee you spend, sometimes up to certain limits. Depending on the card, you can then use your rewards in a variety of ways in your daily life, purchasing items.

Reward cards represent a large portion of the credit card market today, and they seem to offer something for everyone. In addition to different rewards structures, the cards vary in terms of how your rewards can be redeemed and what kinds of things they may be redeemed for.

Similar to reward credit card, every card come up with different feature have their own advantage and disadvantage, it’s up to you to choose the better credit card depending on your daily lifestyle. Literally every card offer rewards and there will be restriction on how, where, and on what to use it. So you can decide the best credit card that suits you the most.

Note: It’s not the NAME, It’s about which feature best suits for your day-to-day life.
Note: Never buy a thing to impress other! Know your finance, ask yourself that can you afford it? Always!!!!
Summary: Let me sum up in simple words, Credit cards give you Security, Reliability and Rewards. If you don’t learn how to use it, you will definitely get into trouble.

List of other available credit cards in India

Reward Credit Card

Platinum Credit Card

Shopping Credit Card

Travel Credit Card

Premium Credit Card

Titanium Credit Card

Women Credit Card

Fuel Credit Cards

Silver Credit Card

Classic Credit Card

Basic Credit Card

Low Interest Credit Card

Gold Credit Cards

Business Credit Card

Entertainment Credit Card


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