Obtaining a credit card is one of the easiest ways to manage your finances and establish a credit score. However, not everyone qualifies for a regular credit card. If you are just starting out or do not have a credit history yet, there is a simple solution available — a credit card against fixed deposit. This type of card is secured. It means you need to keep a fixed deposit (FD) with the bank, and in return, the bank gives you a credit card against FD. The credit limit is based on the value of your FD, usually around 80-90% of the deposit amount. Let’s understand how you can go through the credit card apply process through this method, and what benefits come with it.
What Is a Credit Card Against Fixed Deposit?
A credit card against fixed deposit is a secured card backed by your FD. It works like a regular credit card. You can use it to make purchases, pay bills, and earn rewards. The key difference is that the bank holds your FD as security. This reduces their risk, which is why they are more willing to approve your application.
This is a great option for those who do not have a salary slip, credit history, or CIBIL score. By using the card wisely and paying bills on time, you can begin to build a strong credit profile.
Benefits of a Credit Card Against FD
● Easy approval
Since the card is secured, banks are more likely to approve your credit card apply request.
● No income proof needed
You do not need to show a salary slip or ITR.
● Helps build credit history
Making regular payments helps you build your credit score over time.
● Low minimum FD requirement
Many banks allow you to start with an FD as low as ₹10,000.
● Continued FD interest
Your FD continues to earn interest even while serving as security.
● Low risk of rejection
The chances of being denied are low because the FD acts as collateral.
How to Apply for a Credit Card Against FD
Now that you understand the benefits, here are the steps you need to follow for a credit card apply process against an FD:
Step 1: Open a Fixed Deposit
The first step is to open a fixed deposit with the bank. You can do this online or by visiting the nearest branch. Make sure the bank offers credit card against fixed deposit options.
Some banks offer this facility only for specific fixed deposit (FD) tenures (such as 1 year or more). Also, check the minimum FD amount required to be eligible for the card.
Step 2: Fill Out the Application
Once your FD is active, ask the bank for a credit card apply form or fill it out online through their website. Select the option for credit card against fixed deposit and provide the required details.
Since the FD is already with the bank, you don’t have to submit many documents. Typically, basic Know Your Customer (KYC) documents, such as Aadhaar and PAN, are sufficient.
Step 3: Wait for Approval
The bank will verify the FD details and process your application. Since this is a secured card, approval is often quick. In most cases, you receive your card within 7–10 working days.
Step 4: Start Using the Card
Once your card arrives, activate it and start using it for your regular purchases. Ensure that you pay your bills on time to avoid penalties and maintain a positive credit record.
Even though this is a secured card, it still impacts your credit score. Regular and responsible use will help you qualify for an unsecured card in the future.
Points to Remember
- Your credit card against FD will have a lower credit limit than your FD. Usually, it’s up to 85% of the deposit value.
- If you fail to repay the dues, the bank can recover the amount from your FD.
- You continue to earn interest on your FD while enjoying the benefits of a credit card.
- Do not break the FD until the card is active, or your card will be cancelled.
- Some banks may charge a small annual fee or joining fee, though many offer lifetime free cards for this type.
Final Thoughts
A credit card against FD is a smart option if you are looking to build your credit profile or need quick access to a card without going through strict eligibility checks. With simple paperwork, fast processing, and minimal risks, it makes sense to go for a credit card apply option linked to your fixed deposit. If you have a fixed deposit or are considering starting one, take this opportunity to maximise the value of your savings. Apply for a credit card against fixed deposit and take a step towards financial freedom.
