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How to Apply for a Secured Credit Card?
Posted on Wednesday, September 4th, 2024 | By IndusInd Bank
Are you looking to establish or improve your credit score? Applying for a credit card can be an effective way to achieve this. However, if you have a low or non-existent credit record, securing a regular credit card can be challenging. Low or no credit scores typically signal higher risk to issuers, who may deny your application to avoid potential defaults on repayments.
The best solution in this situation is to apply for a secured credit card. Backed by a fixed deposit account, a secured credit card lowers the risk for issuers, making approval easier. By using a secured credit card responsibly, you can build or rebuild your credit record, making it easier to qualify for a regular credit card in the future.
So, how do you find and apply for the best secured credit card in the market? Follow this step-by-step guide to apply for a secured credit card confidently.
1) Understand what is a Secured Credit Card
Before beginning the research process for a secured credit card, you must be well-versed in what a secured credit card is. A fixed deposit backs a secured credit card, acting as a collateral. This deposit determines your credit limit.
The fundamental purpose of a secured card is to assist you in building and rebuilding your credit score. It functions like any other credit card, but the deposit lowers the risk for the issuer. Note that as such, secured cards come with lower benefits, it is recommended to switch to a regular credit card once your score improves.
Also Read: What Is a Credit Card Against Fixed Deposit?
2) Research Options Available and Submit Application
Different issuers offer distinct features, so compare their fees, benefits, and requirements. Make sure you select a card that matches your financial goals and needs. Online reviews can provide great insights into the best secured card.
Once you have selected a preferred card, visit the bank’s site to place your application. Fill out the required form and provide the required documents. Before final submission, ensure all info is accurate to avoid any delays in application processing.
3) Make Your Security Deposit
Once your application is approved, you will be required to make a security deposit as a fixed deposit, which serves as collateral for your card. This amount depends on the issuer and your desired credit limit.
The deposit you make not only secures the card, it also determines your limit. Ensure you understand the terms and conditions associated with the deposit, such as interest rates and conditions for retrieval, before zeroing in on any card.
4) Transition to Unsecured Credit Card
Once you have successfully used your secured card and built a good score, you may apply for an unsecured credit card. This transition can further enhance your access to credit and provide great financial flexibility. How?
This is because an unsecured card does not need a deposit and often comes with higher credit limits and better reward programs. One of the best regular credit cards you may go for is the IndusInd Bank Platinum RuPay Credit Card. With this RuPay credit card, you can make the most out of a range of features offered. Top features include:
| Credit card-enabled UPI | Use your credit card for UPI transactions |
| Save on fuel purchase | 1% fuel surcharge waiver |
| Earn rewards while making transactions | Earn 2 reward points on every ₹100 transaction through UPI and 1 reward point on non-UPI transactions |
To sum up
Applying for a secured credit card involves understanding its purpose, researching distinct options, gathering required documents, submitting your application, and making a security deposit. Over time, with disciplined usage and timely repayment of the secured credit card dues, you can build a strong credit score.
A good score makes you eligible for a regular credit card like IndusInd Bank Platinum RuPay Credit Card, which offers a host of benefits, from robust rewards to seamless UPI integration. So, do not procrastinate, choose wisely, and make the most out of the financial benefits that come with disciplined credit card usage. Apply now!
Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.
