Are you applying for a first credit card? Do you wish you could whip out a piece of plastic instead of fumbling with wads of cash, every time you go shopping?  You might have many questions and concerns regarding their use and how to choose the card best suited to you.  In many developing economies, like India, credit cards are becoming increasingly popular because of their safety, convenience and ease of use. You can use a credit card to buy anything from jewelry to groceries. Having a credit card means that you do not need to have cash with you at all times to make purchases.

In very simple terms, a credit card allows you to borrow money on a monthly basis to make purchases. When you buy something using your credit card, you are using your credit card issuer’s money on loan until you pay off the amount when you get your credit card bill at the end of a month

What is the best first credit card to get?

There are several options for a first credit card. If you have absolutely no credit history – i.e. if you have never taken a loan or credit card - then it might be difficult to get approved for a first credit card with no credit background. A secured credit card might be a good option for someone with no credit history. It works just like a credit card except that you need to make a fixed deposit in order to get a secured card. The bank uses the deposit to recover their dues in case you default on your payment.

 A secured credit card is typically used by people who cannot qualify for a regular unsecured credit card either because they have bad credit or because they do not have a sufficient credit history.

How do I choose the best first credit card?

The only way to choose the best card is to research the features and benefits of the various cards on offer to judge if it suits your credit needs. Each person has different requirements for their card. You will need to check

• the interest rate charged on the balance

• whether the credit limit suits your spending pattern

• whether using the card offers any rewards or benefits ( like air miles or shopping discounts)

• the security features in case of fraud or theft

• the various fees charged including annual fees, late fees etc.

Compare the features of various cards to see which is most suitable for you.