India is witnessing a significantly higher preference for cashless transactions in the present days as opposed to traditional modes of payment. The fact that digital transactions increased by a massive 55% last year is suggestive of such a shift. The demand and usage of premium credit cards have also seen an upward change to the tune of 43%, indicating the credit-savvy nature of Indian consumers, which is hard to miss.
Credit card usage boost is riding swift on digital push, which continues to grow at a rate of 27%. The circulation of credit cards has already exceeded 48.9 million according to data published by the Reserve Bank of India.
While credit card use is on the rise, you must know the different types of credit card in India before you rush to apply.
The different types of credit card available in India
Credit cards offered by different financial institutions vary in the features and benefits. For the purpose of categorisation, credit cards are distinguished on the basis of particular purposes that they serve. The most common types include –
Shopping credit cards
These payment tools are the most popular type of credit card in India as they provide users with ample opportunities to save with every spending. If purchases are made from partner outlets, based on the total amount, the reward points are credited to the user’s account, or cashbacks and discounts provided.
The points so earned are to be further redeemed to avail discounts or other benefits on future transactions. For instance, the Bajaj Finserv RBL Bank SuperCard offers up to 20,000 reward points as a sign-up bonus.
Fuel credit cards
These cards primarily provide attractive offers on refuelling your vehicle every time from partner fuel stations. That is not to say those credit cards cannot be used anywhere else, but it means that there are sizable discounts and waivers to be availed at fuel stations. To combat high fuel prices, this credit card can thus be used suitably.
Lifestyle credit card
A lifestyle credit card takes into account the different lifestyle needs of users and offers discounts and reward points on the same accordingly. These cards are usually in wide circulation and frequently used at both online and offline shopping outlets.
Such cards often provide attractive discounts and rewards on travel, shopping, dining and a host of similar end eavours from partner stores or brands. The lifestyle credit cards may also provide access to airport lounges and easy booking of partner hotels apart from other complimentary benefits.
Travel credit cards
Credit cards for travel are specifically designed to meet the needs and requirements of those who book tickets frequently for the purpose of tours and visits to new places. They offer special discounts and points for booking air tickets, accommodation, and other related transactions. The points so accumulated can be utilised to further earn air miles and avail better discounts. The customised credit card benefits every traveller with features that stand out from other payment tools.
Co-branded credit cards
Co-branded cards are types of credit cards in India provided by the financial institutions in association with their partner companies. Such partner companies extend attractive deals and offers like discounts, cash backs, reward points, etc. Other merchant entities can also accept these cards and provide useful offers when transacting with such cards.
Credit cards for women
As the name suggests, these cards particularly cater to the spending needs of women. Both homemakers and working women professionals can opt for this type of credit card in India. The benefits largely include rewards, cashbacks, and discounts, among others. Substantial savings while shopping in apparel stores, grocery chains, salon facilities, etc. are available on such card transactions.
Entertainment credit cards
Entertainment credit cards may be offered in collaboration with lifestyle and entertainment partners. Attractive offers can be provided on concerts, movie tickets, sports events, performance shows, etc. booked through these cards.
Credit card application should thus be made after determining whether the specific card provides such benefits as needed by the applicant. You may compare it with other similar credit cards and choose accordingly. Financial institutions like Bajaj Finserv also extend pre-approved offers to facilitate the application process. Such an offer is available for different financial products such as credit cards, personal loans, and business loans. You can check your pre-approved offer by entering your name and contact number.
Make sure to select a credit card based on your spending habits to make the most of available reward programs. When applying for the card, also consider the charges involved to ensure that the benefits exceed the fees charged on such cards.