All You Need to Know About Credit Cards

A credit card is a payment card issued by a financial institution, such as a bank or an NBFC, that allows the cardholder to borrow funds to make purchases or obtain cash advances. The credit limit, determined by the card issuer based on the cardholder's creditworthiness and other factors, specifies the maximum amount the cardholder can use the credit card to make purchases.

A credit card comes with various features and benefits, such as discounts, reward programs, cashback offers, lounge access, fraud protection and many more. It can be used for online purchases, travel, and everyday expenses, and is a convenient way to manage cash flow and build credit history.

However, it's important to use credit cards responsibly and pay off balances in full and on time to avoid accumulating too much debt over time.

Continue reading to learn more about the different elements of a credit card, how they work, and how to choose the best credit card for yourself.

A credit card typically contains the following elements.

1. Cardholder Name: This is the name of the person who has been issued the credit card.
2. Card Number: This is a unique 16-digit number assigned to the card that identifies the credit card issuer and the account holder.
3. Expiration Date: This is the date on which the credit card will expire and can no longer be used further.
4. Security Code: This is a 3-digit or 4-digit code located on the back of the credit card that is used to verify the identity of the cardholder during transactions.
5. Card Issuer Logo: This is the logo of the bank or financial institution that issued the credit card.
6. Magnetic Stripe: This is a black stripe on the back of the credit card that contains the cardholder's account information and can be swiped through a card reader.
7. Chip: This is a small microchip embedded in the front of the credit card that provides additional security features during transactions.
8. Contactless Payment: Some credit cards may also have a contactless payment feature that allows the cardholder to simply tap their card on a payment terminal to complete a transaction.
9. Signature panel: This is a space on the back of the card where the cardholder signs to indicate that the card belongs to them and implies their consent to abide by the terms and conditions governing the use of the card.
10. Card network logo: This identifies the payment network that the card belongs to, such as Visa, Mastercard, American Express, or RuPay.

Here is a breakdown of the different attributes of a credit card and how they work:

1. Credit Limit: This is the maximum amount available to be borrowed on your credit card. Your credit limit is determined by the credit card issuer based on your creditworthiness, income, payment history and other factors.
2. APR (Annual Percentage Rate): This is the interest rate you are charged on any unpaid balance on your credit card. The APR can vary depending on the credit card issuer and the type of credit card.
3. Transaction Charges: Some credit cards may charge transaction fees for certain types of transactions, such as cash advances, balance transfers, or foreign transactions.
4. Withdrawal Charges: If you use your credit card to withdraw cash from an ATM or bank, you may be charged a withdrawal fee in addition to any interest charges.
5. Maintenance Fees and Charges: Some credit cards may have annual fees or other maintenance fees that you are required to pay. These fees may be waived for certain types of credit cards, such as lifetime free credit cards.

In India, there are several credit card payment processing networks that provide secure and efficient services for credit card and debit card transactions. They also offer various features such as rewards programs, fraud protection, and purchase protection to enhance the user experience. Some of the prominent credit card payment processing networks are:

1. Visa: It is a global payment processing network that operates in India and facilitates transactions for both credit and debit cards. Currently, Visa has the largest market share in the country.
2. Mastercard: Mastercard is another global payment processing network that operates in India and provides services for credit and debit card transactions.
3. RuPay: RuPay is an indigenous payment processing network developed by the National Payments Corporation of India (NPCI) and is designed to cater to the needs of the Indian market. It is used primarily for debit card transactions, but also provides credit card services.
4. American Express: American Express is a leading global financial services company that provides credit card services in India through its payment processing network.

Using a credit card offers a range of benefits to the cardholder, such as:

1. Convenience: Credit cards are widely accepted both online and offline, making them a convenient payment option for everyday purchases, saving you from the hassle of carrying cash .
2. Rewards programs: Many credit cards offer rewards programs, such as cashback or reward points for every purchase made on the card, which can be redeemed for various benefits like discounts, merchandise, or travel.
3. Building credit: Responsible use of a credit card can help build a positive credit history, which can be beneficial for obtaining loans, mortgages, or other forms of credit in the future.
4. Fraud protection: Most credit cards come with fraud protection, which means that if your card is stolen or used fraudulently, you are not held liable for the charges.
5. Purchase protection: Many credit cards offer purchase protection, such as extended warranties or protection against theft or damage, which can provide peace of mind when making large purchases.
6. Travel benefits: Some credit cards offer travel benefits such as travel insurance, airport lounge access, or no foreign transaction fees, which can be useful for frequent travellers.

IndusInd Bank provides a range of instant credit cards to complement your lifestyle. No matter if you are a shopaholic, a foodie, a globetrotter, or a hodophile, there’s a card to fit into all your needs. Have a look at our cards below.

1. Legend: This LIFETIME FREE credit card provides world-class travel, dining, shopping, and entertainment privileges, with exclusive offers on your favourite brands, up to ₹25,866 in rewards, and up to ₹2,400 annual savings on fuel surcharge. You earn 1 reward point on weekdays and can earn double i.e. 2 reward points on weekends for every ₹100 spent with this card.
2. EazyDiner: This credit card comes with a free 1-year EazyDiner Prime membership worth ₹2950, along with travel, entertainment, insurance cover, and many other exciting benefits. You can earn 10 reward points on every ₹100 spent across dining, shopping, and entertainment with this card.
3. Nexxt: India's first interactive credit card, Nexxt, comes with interactive buttons and LED lights. You can switch between payment modes with just a press of a button and pay seamlessly, anywhere. You also get to enjoy annual savings of up to ₹24,100 on your regular spends and up to ₹960 on fuel surcharge annually. You earn 1 reward point for every ₹150 spent with this card.
4. Platinum Aura Edge: This credit card encompasses all the features, including discounts on travel, deals on shopping, offers on dining out, and much more. You can choose your own reward program based on your spending preference and earn up to 4X reward points on every ₹100 spent with this card. The best part is the card comes with Zero Joining and Zero Annual Fee.
5. Platinum VISA: The IndusInd Bank Platinum Visa Card offers a range of features to its customers. These include a rewards program that lets you earn 1.5 reward points for every ₹150 spent, 1% fuel surcharge waiver, insurance coverage for air accident, lost card liability, and purchase protection features.

Here’s why you should consider choosing an IndusInd Bank Credit Card.

1. Easy Application Process: Complete your IndusInd Bank Credit Card application from the comfort of your home or on the move. It’s quick, easy, and 100% paperless.
2. Lifetime Free: Unlike most credit card issuers, IndusInd Bank offers a range of credit cards that are free for life as there’s no joining or annual fee involved.
3. Impeccable Rewards: On every transaction you make using your IndusInd Bank Credit Card, you earn reward points that never expire. You can even convert your points to cash for payment of dues.
4. Offers on brands: From dining & entertainment to shopping & healthcare, get exclusive discount offers on your favourite brands like BigBasket, TATA 1MG, LG, Titan, and more.
5. Protection features: IndusInd Bank Credit Cards come with one-of-a-kind Total Protect feature that covers you for any unauthorised transactions in case of loss/theft of card.
6. Fuel Surcharge waiver: 1% fuel surcharge waiver across all fuel stations in India. You can save upto Rs. 2400 on fuel surcharge every year.