Choosing the Best Type of Credit Card for Your Needs

 

There are various types of cards you can choose from. They range from rewards cards offering points or cashback to travel cards providing air miles and lounge access. Different types of credit cards provide you with different benefits, such as rewards, cashback, and more. These cards can help you maximise your savings based on your spending habits. Responsible use can help build your credit score, while overspending may lead to debt. 

Understand these different types of credit cards and choose the right fit for you!

Components of a Typical Credit Card

There are various different elements in each of these cards that you need to know about. 

Feature	Description
Chip	A small, metallic square (EMV) on newer cards that enhances security by generating a unique code for each transaction.
Issuer logo	The symbol of the bank or institution that provided the card.
Security code	A 3-digit code (CVC or CVV) used for added security during online transactions.
Cardholder's name	The name of the person the card is issued to, which is shown below the card number.
Signature panel	The space on the back of the card where the cardholder signs their name.
Magnetic strip	Found on the back of the card, it stores important data like the account number and expiration date, used when swiping the card.
Customer service number	A contact number printed on the back of the card for support with any card-related issues or questions.
Card number	A unique 16-digit number on the front of the card that links the card to the issuer and the account holder.
Expiration date	The date when the card becomes invalid, typically printed below the card number.

Cards and Their Features

Before applying for one, you need to understand how many types of credit cards exist in India. Here is an overview to enhance your understanding:

Cashback Credit Cards: These options give you direct cashback on everyday purchases, making them a smart choice for regular spending. Here are some of the features:

• Percentage Back: You get a percentage of your spending back as cashback, with different rates for categories like groceries or online shopping.

• Statement Credit: The cashback you earn is applied directly to your card balance, helping lower your overall bill.

• Monthly Limits: Some options limit how much cashback you can earn each month, so be sure to check the terms.

Fuel Credit Cards: These cards help you save on fuel by offering rewards like surcharge waivers and points when you fill up. With these cards, you enjoy the following perks:

• Fuel Surcharge Waiver: You avoid the extra charges added to fuel purchases, making your refills more economical.

• Reward Points on Fuel: Earn points on your fuel transactions, which you can use for future refills or other rewards.

• Partner Stations: Some options provide additional benefits when you fuel up at specific stations, helping you save even more.

Lifestyle Credit Cards: These options offer benefits across different areas like dining, shopping, entertainment, and wellness. Here are some key features:

• Dining Discounts: Enjoy special discounts at partner restaurants, making eating out more affordable.

• Wellness Perks: Save on gym memberships, spa treatments, and health services.

• Shopping Offers: You get deals and discounts at retail stores and online shops.

• Entertainment Benefits: Access exclusive events, movie ticket deals, and discounts on entertainment expenses.

Student Credit Cards: These options help you manage your finances and start building your credit history with easier requirements to get approval. You can enjoy these perks:

• Lower Limits: These cards come with lower credit limits, making it easier for you to stay within your budget.

• Simplified Application: You’ll find it easier to apply, with fewer eligibility requirements than traditional credit cards.

Secured Credit Cards: These options are a great choice if you’re new to credit or rebuilding your score, as they require a security deposit. Here are some key perks:

• Credit Building: Using these cards responsibly helps improve your credit score over time.

• Transition to Unsecured: After showing responsible use, you may be able to upgrade to an unsecured option.

• Deposit-Based: Your credit limit matches the deposit you make, lowering the risk for the issuer.

Rewards Credit Cards: These cards let you earn points, cashback, or other perks every time you make a purchase. You can redeem these rewards for products, services, or discounts. You can enjoy these features:

• Points System: Each time you spend, you earn points that you can redeem for gifts, vouchers, or travel bookings.

• Cashback: Some options offer cashback, allowing you to use it to pay your credit card bill or transfer it to your bank account.

• Flexibility: Use your rewards for flights, hotels, shopping, dining, and more.

Travel Credit Cards: These options are perfect if you travel frequently, offering perks like air miles, lounge access, and travel insurance. Here’s what you can get:

• Air Miles: You earn air miles on flights, hotels, and dining, which can be redeemed for discounted or free flights.

• Lounge Access: Get complimentary access to airport lounges, making your travel experience more comfortable.

• Travel Insurance: Many of these cards include insurance that covers trip cancellations, lost luggage, or medical emergencies during your travels.

Considering how many types of credit cards are available today, the type of card you choose will depend on your lifestyle, finances, and more. An all-rounder card you can consider using is the One Credit Card.

It is a lifetime-free credit card that can help boost your financial management. With its innovative One Credit Card App, you can view all your transactions in one place. Earn up to 5X rewards on your spending and save more with every swipe. Download the app or visit the website to apply now!