A fixed deposit (FD) account can open up opportunities to access credit if you don’t already have an established credit history. Banks offer FD-backed credit cards that use your FD as collateral, allowing you to enjoy the benefits and convenience of having a credit card. If you’ve been wondering how to apply for a credit card against a fixed deposit in India, this detailed guide will walk you through the key steps.
What is an FD-Backed Credit Card?
A fixed deposit-backed credit card is a type of secured credit card in which the credit limit is determined as a percentage of the FD amount you have invested. Your FD acts as the security against which the credit card is issued.
These credit cards are designed for individuals with little to no credit history or those with a poor credit record. Instead of assessing your creditworthiness based on income, credit score, etc., the bank relies on your FD as assurance. You can get approved for an FD-backed credit card if you have an active FD account with the bank.
The most significant advantage is that you can build your credit score from scratch with a secured credit card. Use it responsibly by making timely repayments, and you’ll start establishing a healthy credit profile.
Key Benefits of Credit Cards Against FD
Here are some significant benefits that make FD-backed credit cards a great option:
- Easy approval – Get a credit card instantly without proof of income or credit score requirements.
- FD safety – Your fixed deposit amount and interest earnings remain unaffected.
- Low credit limit – Limit set as per FD amount encourages responsible usage.
- Build credit – Helps establish credit history through disciplined usage and repayments.
- Rewards – On transactions, many cards offer cash back, discounts, loyalty points, etc.
Who is Eligible for an FD-Backed Credit Card?
The eligibility criteria for credit cards against fixed deposit are straightforward:
- You must be an Indian citizen aged 18 years or above
- You need to have a fixed deposit account with the issuing bank
- Minimum FD amount criteria may apply, usually as low as INR 20,000
- Your KYC documents must be updated in bank records
As long as you meet these basic eligibility norms, you can apply for an FD-backed credit card regardless of employment, income, or credit score.
How to Apply for a Credit Card Against FD
Follow these key steps to apply for and get a credit card against your fixed deposit:
1. Choose the Issuing Bank
Various leading banks offer FD-backed credit cards. Compare features across banks and choose one that aligns with your preferences and needs.
2. Open an FD Account
If you don’t already have an FD account with your selected bank, open one for a minimum tenure of 6 months to 1 year. The FD amount will determine your credit limit.
3. Fill out the Credit Card Application Form
Visit your nearest branch, fill out the application form for your chosen FD-backed credit card, and submit your KYC documents.
4. Activate Your Credit Card
Once approved, you’ll receive your credit card within 2 weeks. Activate it through IVR or net banking to start using it.
5. Use Responsibly, Build Credit
Use your new credit card wisely for purchases and bill payments. Make timely repayments to establish a healthy credit profile.
AU NOMO Credit Card – A Smart Choice for New Cardholders
If you’re a first-time credit card user or have limited credit history, the AU NOMO Credit Card can be an ideal choice. Designed to support credit-building, AU NOMO offers a range of rewards and lifestyle benefits that make spending easy and enjoyable.
- Reward Points: Earn points on retail purchases and enjoy redemption options across categories.
- Lifestyle Benefits: Access airport lounges and railway lounges and take advantage of lower fees on select international transactions.
- Flexible Payments: Features like EMI conversions and surcharge waivers make the AU NOMO Credit Card versatile for everyday use.
The Bottom Line
For individuals with little or no credit history, an FD-backed credit card can provide access to credit while helping build a strong credit profile. With disciplined usage, you can use this secured card to establish your credit score and eventually qualify for an unsecured credit card.
Consider the AU NOMO Credit Card if you’re looking for a flexible, rewards-based experience that supports your financial journey. Apply today against your fixed deposit and enjoy the convenience and benefits of a credit card while building your credit history.
