Once Hari and Shyam went to a hotel for dinner. It was a well-known restaurant in town and the food was delicious. At the end of the meal both were checking out their pockets to pay for the meal. Shyam came forward, took out his credit and made the payment. Later, Hari was surprised to find that he needed to pay only less than what he had eaten. He asked Shyam how he could pay less than the original amount. Shyam explained to him that by paying through his credit card they could get a discount of 30% on the total price of the food and as an option using his credit card is a boon as it gets him offers, rewards and discounts on various spends.
Naturally now Hari too was determined to get a credit card and enjoy the benefits just like his friend. But when he did approach one of the many credit card issuers to his surprise he found that not having a credit history is a big deterrent in getting a credit card of his choice. Having not borrowed before, he wanted to take his first step in the credit world. But once he surfed the internet to get a credit card without credit history, he was surprised to find quite many options. Eager to know what he found out? Just read on!
Secured credit cards
Most lenders offer credit cards against a fixed deposit account. You will be allotted up to 75% of value of the fixed deposit as credit limit on your card. Later on, with judicious usage and consistent bill payment, you can step up your credit limit. But when you default on your payment, the lender will use the fixed deposit as the security. The secured credit cards on regular and prudent use would help the user build up considerable credit history for the future.
Income Based Credit Cards
Most lenders these days give away credit cards based on your income. If you are drawing more than INR 20,000 per month, you must have received a sales call from any one of the banks that issue credit cards. The lenders expect a steady source of income from the credit card holder for regular repayment.
If you have a regular monthly income, you can approach any one of the banks or the bank where hold a savings account and apply for a credit card. For salaried employees, it becomes much easier to get a credit card if the company they work is listed by the bank.
Using alternative qualifiers
Banks are gradually considering alternatives to credit score for evaluating the creditworthiness of the borrowers. A move that could potentially bring in more people into formal credit, some credit card issuers now have begun to supplement the existing credit scoring methods to assess credit worthiness.
Documents required to get a credit card
To get a credit card, you may have to submit the following documents for processing
· Income proof
· Identity proof
· Address proof
· Bank statement of last six months
· Salary slip of last 3 or 6 months
· IT returns if needed
Having gather all the information required to get a credit card, Hari chose the method that is convenient to him and approached the credit card issuer. His application was processed, and he got his credit card successfully. He has now improved his savings and is able to enjoy a lot of benefits that come along with card.