Credit cards are an amazing financial instrument used by almost everyone today! Credit cards are famous for the security they provide along with the option to take emergency loans at any time without paying any interest.
They are the first priority for customers while shopping because of the lucrative rewards one gets just by using them. One of the criteria before getting a credit card is showing proof of income because of which students usually don’t think of getting one.
Most of the students are unaware of student credit cards and in this post; we discover the ultimate information on these cards. We will be discussing everything about the cards including eligibility, rules, terms and how to apply for one.
Stay tuned to make sure you are equipped with all the information!
Table of Contents
Overview of Student credit card
Before we jump into the technical and other related details, let’s understand the basic features and benefits of using student credit cards –
- These cards are one of the easiest to fetch as banks and companies do not ask for income proof. You just have to share some proofs of you being a student and some other small formalities
- It offers one of the most lucrative rates of interests
- It is an amazing way to build your credit limit before you graduate. You can leverage the same good credit score to avail loans at competitive prices in the future
- There are hundreds of schemes and attached benefits that help you save a lot of money. You can even use the reward points to make necessary purchases and save more
- These cards also enjoy the lowest joining fees and maintenance costs if you compare them with other credit cards
Student credit card terms and conditions
There are many types of student credit cards in the market, each with its own terms and conditions. Some of the terms are common in all of the cards. We are listing most of these for you to get an idea –
- The first condition is that the applicant must be 18 years of age
- If you are applying for a student loan credit card, the student must have an approved student loan first
- For a secured credit card, the student must have a fixed deposit with the bank for the specified amount
- For add-on student cards, the immediate family member must have a credit card with the same bank where the application is submitted
Credit Card Limits for the Students
A lot of factors define the credit limit of a student credit card. To understand this better, refer to the following scenarios.
1. Usually the credit limit of students’ credit cards is up to Rs. 15,000 with a validity of 5 years
2. In the case of add-on cards, student credit cards share the credit limit of the parents and the total limit can be shared among all family members
3. In the case of secured student credit cards, banks allow a limit of up to 80% of the value of the fixed deposit
4. In the case of credit cards issued with loans, your limit is defined by the size of the student loan and the requirements during your course of study as discussed and defined in the loan application initially.
Student credit card eligibility
Eligibility criteria for banks are usually covered in the terms and conditions of the specific card.
We are listing the main eligibility criteria which you need to take care of before applying for any student card.
- The applicant must be above 18 years of age
- The applicant must be a student in a college or university. Student identity cards are often used as proof in the applications
- Some banks even ask applicants to open a savings account with a specific minimum budget to be eligible for loans
- Some banks allow student credit cards only to applicants who have an education loan with the same bank
- In case of an add-on card, your parent must have a credit card with the same bank
- Secured credit cards require a fixed deposit in the same of the student who has applied for the credit card
How to apply for a student credit card online
After carefully analyzing, comparing, and making a decision about the card that you wish to get, you can easily apply on the bank’s website.
Make sure to read the features and make an extensive comparison between all the available options. The features and terms will change with every company and bank and you have to select the one that benefits you the most holistically.
Some of the documents which will be required are –
- Birth certificate
- College or university ID
- PAN card
- Residential address proof
- Passport size photographs
There are also many ways of applying online –
- You can apply directly from the bank’s website if you maintain the minimum balance in your savings account as specified in the rules
- If you have a fixed deposit in your name, you can apply for a secured credit card on the bank’s website in most cases
- You can ask your parents to apply for an add-on card on the bank’s website
Getting a student credit card early on in life is one of the smartest financial decisions you will make. Using the card will give you a hang of your finances and give experience with managing credit early on.
Make sure to read on about the rewards that you can get with every kind of card and how you can leverage these for your benefits. Proper use of your credit will also help you to build a robust profile early on!
Also, make sure to read all the information in this blog post so you can get to know the available options and consider them before making a decision.
You will get an option to convert the same card into a normal credit card after your studies are over. So make sure to build a healthy credit score along with a concrete habit of repaying on time or I should say before time!!!