Credit Card Against Fixed Deposit

How Does a Credit Card on Fixed Deposit Work?

A Credit Card against Fixed Deposit allows you to secure a Credit Card by placing funds in a Fixed Deposit Account. The deposited amount acts as collateral for the Credit Card. This makes it a suitable option for individuals with no credit history or low credit scores. These cards function like regular Credit Cards, offering a predefined credit limit that can be used for various transactions and purchases.  

Features and Benefits of a Credit Card Against FD

Here are the features and benefits of getting a Credit Card against Fixed Deposit: 

• Easy Approval: An FD-based Credit Card is a great option for individuals with limited or no credit history, making it easy for them to get approval. 
  
  
• Building Credit Score: Timely repayment of Credit Card dues helps establish a strong credit history and improve your credit score over time. 
  
  
• No Income Proof Required: You can get a Credit Card against FD without providing income proof, employment history or credit score details.
  
  
• Fixed Deposit Continuity: Your FD continues to serve as an investment generating returns. Interest payments on FDs are not stopped while the FD is pledged as collateral. 
  
  
• Access to Funds: The card provides a safety net for emergencies or larger purchases without withdrawing from the FD. 
  
  
• Grace Period: You can use the Credit Card for purchases and pay it off within a specified period without incurring interest, as long as the balance is paid in full by the due date. 
  
  
• Rewards & CashBack: Earn Reward Points /CashBack on eligible transactions and redeem them for vouchers, airmiles or statement credit.  
  
  
• SmartEMI: Turn your online and in-store Credit Card purchases into easy EMIs and enjoy flexible repayment options with competitive interest rates. 
  
  
• Easy Management: Track and control your HDFC Bank Credit Card spends on MyCards or NetBanking or Mobile Banking App. 

How to Apply for a Credit Card Against FD?

Here are the steps for an FD Credit Card apply: 

1. Create a Fixed Deposit: If you don't already have an FD with HDFC Bank, open one online or in-branch. Consider the credit limit you want and create a deposit accordingly.

2. Fill Out the Application: After creating the Fixed Deposit, you can click here to apply for a Credit Card against Fixed Deposit.

3. Submit The Required Documents: If you opt to submit a physical FD backed Credit Card application, you will have to submit your identity and address proof documents (for KYC purposes). Additionally, you must submit the Fixed Deposit Certificate to complete the documentation process for a Credit Card against FD.

Tip: Go Paperless! Click here to apply for a Fixed Deposit Backed Credit Card online application without any documentation.

4. Approval and Issuance: After application evaluation, we will review your request for a Credit Card and decision.

Eligibility Criteria for a Credit Card Against FD

To be eligible for a Credit Card against Fixed Deposit, you must meet these requirements:

• Citizenship: Be an Indian citizen residing in India with a valid residential address.
  
  
• Age: 18 to 75 years.
  
  
• Fixed Deposit Account: Have an existing FD Account or open one with HDFC Bank.
  
  
• Minimum FD Amount: The minimum FD amount is ₹15,000.

Note: Credit Cards will not be issued if the FD amount is less than ₹15,000, tenure is < 1 year, or PAN is not updated/inoperative.

FD in the name of an individual belonging to Tax Saver, NRI FD, Minors, Existing Lien Marked FD, Sweep-in FD, and Non-Withdrawal FD are not applicable for securing a Credit Card.

Things to Know Before Applying for a Credit Card Against FD

Before applying for a Credit Card against Fixed Deposit, consider the following points:

• Existing FD Requirement: You need to have an existing Fixed Deposit Account with HDFC Bank, or you must be willing to open one.
  
  
• Eligibility Criteria: Familiarize yourself with the eligibility criteria, which typically include age, income, and credit history requirements.
  
  
• Documentation: Prepare the necessary documents, such as identity proof, address proof, and details of the Fixed Deposit. This is applicable for physical Fixed Deposits-backed Credit Card applications through HDFC Bank branches in India.
  
  
• Credit Limit: The credit limit is often linked to the amount of the FD you hold with HDFC Bank. 90% of the Fixed deposit amount is offered as the credit limit. Multiple eligible fixed deposits can selected in the online application to enhance credit limit.

How to Use a Credit Card Properly?

Here are some tips to use your Credit Card effectively:

• Ensure to activate your card within 30 days of issuance to avoid automatic closure of the card. You can activate the card by carrying out a transaction, setting a new PIN, using MyCards, etc.
  
  
• Use your Credit Card regularly for purchases and payments to earn cashback/reward points.
  
  
• Pay your Credit Card dues on time and in full to avoid penalties and build a strong credit score.
  
  
• Redeem your reward points before they expire.
  
  
• Avoid sharing your Credit Card details with anyone. When using your card for online transactions, ensure the website is secure.
  
  
• Monitor your statements regularly to detect any unauthorized transactions.
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• Refer your friends to apply for a Credit Card which rewards your friend and you. Refer now.

Frequently Asked Questions

• What is the minimum deposit amount for an FD Credit Card? 

The minimum deposit amount is ₹15,000 for a Credit Card against FD. 

• What is the interest rate on FD Cards? 

The FD interest rate varies based on the prevailing interest rates and the chosen FD tenure. 

• Is a Credit Card against FD a good option? 

HDFC Bank's Credit Card against FD is a great option that allows you to continue earning interest on your FD while enjoying the benefits of a Credit Card.   

• What happens if you fail to repay Credit Card dues? 

If you fail to repay your Credit Card dues, the issuer deducts the amount owed from the FD amount pledged as collateral. The card issuer also deducts the amount owed as interest in case you do not repay your outstanding Credit Card dues in full, on time. Note that you can also pay the minimum amount due.  

• Can I withdraw FD against a Credit Card? 

You cannot directly withdraw funds from an FD Account against a Credit Card at HDFC Bank. However, HDFC Bank's Credit Card against Fixed Deposit allows you to borrow against FD while still earning interest on it.