The data published by different market research agencies and the Reserve Bank of India (RBI) has reflected that the use of credit cards in India is increasing significantly. A recent report from India’s apex bank has shown that in April 2023, the total merchant transactions using credit cards was 25 crore, which was 22 crore last year.
This popularity can be attributed to different features of this payment card, namely the reward points. However, at the same time, choosing the best credit card in India is also important to maximise benefits. And, to do that, you need to know a few essential pointers.
Top 4 Tips for Choosing the Best Credit Card and Maximising Rewards
Here are some tips to help you find the credit card best suited for your needs –
Tip 1: Understand Your Needs and Spending Habits
Since using a credit card means taking up debt, you need to assess your need and spending habits to find the best credit card. To elaborate, if you shop online for everything and prefer a particular e-commerce platform for it. In a scenario like this, you need to find a credit card offering additional benefits for shopping from that specific platform.
For instance, ICICI Bank has a credit card in partnership with Amazon, which can help you earn exciting cashback and discounts when used to buy products online.
Along with this, you also need to assess your spending habits and understand where you spend more. For instance, if you refuel frequently, then opting for a card that offers benefits on fuel purchases is ideal for your lifestyle.
Tip 2: Assess the Rewards, Cashback and Other Offers
The next tip to find a suitable credit card is to assess the rewards, cashback and other offers of a credit card. In this regard, you need to ask three main questions –
- What are the reward points, cashback and discounts available?
- Are there any limitations on their earning?
- How can you redeem these benefits?
You Can Proceed With the Application Once You Answer These Questions Satisfactorily.
Since rewards, cashback, and discounts help you save significantly on every transaction, it is essential to know all the details. It will help you maximise the potential of a particular card.
Tip 3: Check the Additional Perks
Credit cards offer many other benefits besides the obvious rewards, cashback and additional discounts. This includes airport lounge access, travel insurance, theft and scam protection, etc. These benefits make your ownership of a credit card more rewarding.
It is vital to find cards that offer perks that align with your lifestyle. For instance, if you travel frequently, opting for a credit card that allows you to get discounted flight rates or free upgrades is handy.
Tip 4: Find the Right Credit Limit
The next point to check in this process is the credit limit. Since this will determine your purchasing power, you need to find a card that fits your lifestyle. If you plan to rely on this payment card for most transactions, irrespective of their value, you should go for a card with a higher limit.
Doing so will have two advantages, you can purchase the stuff you want easily, and your credit utilisation ratio will be low.
As a prospective credit card applicant, you must remember these four main tips. Considering them before anything will help you understand your requirements and choose the best credit card in India that fits perfectly. But this is not it; you need to consider a few more things to make an informed decision. They are –
Eligibility Criteria of the Card
Credit card companies have set some eligibility parameters to evaluate whether an applicant can manage a credit card. These are non-negotiable, and you need to fulfil them to be eligible.
A point to remember here is that these factors will change as per the choice of the credit card company and the particular card. So, even if you find a card best suited to your need but cannot meet its prerequisites, you cannot access that, and the credit card application status could get rejected.
So, check these in advance and then proceed to avoid any delays and hindrances.
Credit Card Charges
The next point to check is the credit card charges. Almost every credit card comes with a joining fee, an annual maintenance fee, and other additional costs. Reviewing them is important to take up additional burdens besides credit card debt.
Having said that, like the eligibility criteria, it is also different for every credit card and card issuer. So, once you find a credit card as per your suitability, check its associated fees and then decide.
The repayment options are the next point to review to find a card suitable for your lifestyle. Besides the obvious, you need to check whether the credit card company offers EMI options for repayment. This will be useful when you make a large transaction or struggle to repay the bills at once.
You must also check the billing cycle and provision of minimum amount payment before deciding on a credit card.
Last but certainly not least, you need to review the customer service of the credit card provider before selecting a particular card. Credit card companies offering outstanding service should be a top priority as they will help you resolve any issues with the card and repay faster, reducing your financial losses.
Considering the amount of credit card options available in the market, getting confused is natural. However, cutting through the clutter and finding the right option is important, and following the tips and suggestions mentioned above will help you in this process. So, assess all your options and focus on making a knowledgeable decision that will not affect your financial future.