A credit card in hand is a life-saver in need. Credit cards are the financial tools that give purchasing power. If you are new to credit cards orin an emergency for funds, read this article fully. This will give you complete knowledge of credit cards and their period of approval.
What exactly is a Credit Card?
A credit card is a type of credit that is provided by banks and other financial institutions. Individuals can use funds from the credit card within the pre-approved credit limit. The credit limit will be fixed by the lender before issuing the credit card.
With the credit amount, you can make cashless transactions on goods and services. The amount fixed for a credit card is based on the person’s eligibility. The lender will charge interest for the amount that you borrowed. In short, a credit card is like a short-term loan. You borrow and pay later.
What are the factors considered to get a Credit Card?
These are a few common factors that are considered while applying for a credit card.
- Employment status: This is the prime factor in getting a credit card. The lenders will hardly provide a credit card for an unemployed person. This is because of their inability to repay. You can either be a salaried or a self-employed individual.
- Credit (CIBIL) score: This is the prime factor that is considered in applying for a credit card. CIBIL Score is a three-digit number indicating a credit history. The scale ranges from 300 to 900. It is always advised to have a minimum score of 700 to avail of a credit card. If you have a low score, it is possible to increase your CIBIL score. Better to check your credit (CIBIL) score than to bleed later.
- Financial discipline: The lenders will see your past repayment history for a credit card. This will make your profile low-risk.
- Age: The lenders (banks) will consider your age as a factor. It is subject to change for different institutions. The minimum is your age, maximum will be the chance for you to get a credit card.
- A good relationship with the lender: Transactions and positive financial records with the lending institution matter. This will increase the trust in your repayment.
- The reputation of your organisation: The reputation of your organization plays a major role. If you work in a well-known company, the chances for your credit card will increase.
How long it takes to get approved for a Credit Card?
- You can apply for a credit card both online and offline.
- The actual process of filling out the application takes time. Once you are done with that, the formal approval online takes only 2 minutes.
- But the time required to get a credit card in your hand may take a few days to weeks. This is completely based on the lender and the personal credit history.
- During that period, the creditors (lenders) will check for eligibility from their side.
- In some cases, the lender may send a letter or an email and request additional information, if any.
- However, applying for credit cards online will be quicker than the offline process. This is because the time for standing queues, countless documentation, and others will be eliminated.
- Note: It is always advised to check your eligibility before applying from the lender you are choosing for a credit card. Lenders like Piramal Finance will be trustworthy and legitimate and can be chosen without a second thought. This will make the process of approval quicker.
What are the benefits of having a Credit Card?
- Wide acceptance: This is the most practical benefit that you could reap from credit cards. Credits are widely accepted on an international scale. You can carry it and make payments irrespective of geographical boundaries.
- Rewards and offers: The best credit card lenders in the market will never fail to surprise you with your credit cards. It may include discounts on shopping, ticket booking, travel, etc. Sometimes, you will also get exciting offers like travel insurance and cashback. Some lenders will give you lifetime reward points that can us used later.
- Cashless transactions: Carrying cash may bother you due to several reasons including theft. With a credit card, you no need to worry much. Just take a card and go cashless. The payments are also made hassle-free and with ease.
- Flexible usage: Credit cards, unlike educational loans, vehicle loans, and other specific loans, are flexible in their usage. This is because the credit limit assigned to you can be used for any specific purpose. It may be your festive day or even an emergency.
- Improves Credit (CIBIL) Score: A credit score is not only important for a credit card but also for other financial activities. When you repay the amount that you borrow from a credit card without delay, your CIBIL Score will rise.
The bottom line
We hope that you understood Credit Cards, their approval, and their benefits. It is always advised to check the eligibility beforehand. This will help you avoid the eleventh-hour rush.
Credit cards can also make or break your credit score. So, keep an eye on the balance and the due date for payment. Never fail to choose the lender who gives credit cards at comparatively lower interest.
Piramal Finance is the answer in this regard. Our team of experts will guide you through every doubt and decision of yours.