All About Student Credit Cards

Credit Cards are payment cards that allow you to borrow funds to pay for goods and services. You must repay the borrowed funds within the stipulated period. Typically, Credit Cards come with prerequisites like age, monthly income, or credit score, which a student may not be able to fulfill. Therefore, you can benefit from an Add-on Credit Card as a student. Continue reading to know more. 

As the name suggests, a Student Credit Card is a special Credit Card for students who typically don’t have a monthly income or a credit score. A card issuing company like a bank can offer a standalone Credit Card to students or a supplementary card along with their immediate family member’s Credit Card. As a student, you can get the following Credit Cards:

• Add-on Credit Card: An Add-on Credit Card is a secondary Credit Card issued to Credit Card holders. A Credit Card holder can request the bank to issue an additional card for their spouse, children, or parents. The credit limit offered on such cards can be the same as on the primary Credit Card. However, the primary cardholder can choose a lower credit limit on the Add-on Card during the application process if required.
• Credit Card With Fixed Deposits: Many banks also offer a Credit Card against a Fixed Deposit (FD) account. The credit limit offered is usually a percentage of the funds in the Fixed Deposit. Also, the bank may set a minimum limit of principal amount and tenure for the FD to be eligible for Credit Cards. These limits can differ depending on the card variant.

Typically, the only Credit Card eligibility for students would be their age since they don’t have a monthly income or credit score. The minimum age to avail of Credit Cards is usually 18 years. However, the eligibility criteria can differ across banks and credit card issuing companies. You are required to submit a valid ID and address proof, passport-size photographs and other documents required by the bank. 

Depending on the type of Credit Card, the application process can differ. Here’s a general guide on how you can apply for a Credit Card for a student:

• For Add-on Credit Cards: Your immediate family member who has a Credit Card with the bank can apply for an add-on card for you. They must fill out an Add-on Application Form and submit it to the bank. Alternatively, the Credit Card holder can use the bank’s net banking portal to request an Add-on Card.
• For Credit Cards Against FDs: To be eligible for a Credit Card against FD, you must hold an FD account with the bank. If you meet the minimum FD amount and tenure criteria, you can visit the bank branch and apply for a Credit Card against your FD. You can also use your internet or mobile banking platforms to apply for one online. 

States like West Bengal and Bihar offer stand-alone Credit Cards for students as a way for them to finance their education:

West Bengal Student Credit Card Scheme

Under this scheme, students in the state can pursue secondary, higher secondary, undergraduate, graduate and professional degree courses with affiliated institutes within and outside the country. The scheme is also available for students studying in coaching institutions for various competitive examinations in civil services, engineering, medicine, etc.

Co-operative banks and their affiliated central and district central co-operative banks in the state, as well as public and private sector banks, can offer the Student Credit Card Scheme.

Students can avail of a maximum loan amount of ₹10 lakh, which can be repaid over a 15-year tenure at a 4% interest per annum. The maximum age limit of the students at the time of application should be 40 years. Students who have been residents of West Bengal for at least ten years can apply for the Student Credit Card scheme. 

Bihar Student Credit Card Yojana

With the Bihar Student Credit Card Scheme, students residing in the state can get an Education Loan of ₹4 lakh at 4% interest. For students with disability, female students and transgender students at only 1% interest. A student who wishes to pursue their undergraduate can apply for this scheme.

Eligibility Criteria:

• Residents of Bihar.
• Must be under 25 years of age.
• Completed higher secondary education (12th standard) or secondary education (10th standard) if applying for a polytechnic diploma.

Application Process:

• Apply online through the portal or mobile app.
• Register using a mobile number or email address and the OTP received.
• Submit documents, including an Aadhaar card, previous qualification mark sheets, proof of admission, bank passbook copies, passport-size photos of parents/guardians, and ID and address proof.

Listed below are ways a Credit Card can be beneficial for students: 

It helps build credit score

Your credit core is a result of the manner of your debt payments. Debt can be your loans or Credit Card bills. Typically, individuals with income can undertake such debts. A good credit score is imperative to your financial health. With a good credit score, the chance of securing a loan is high. Plus, you can negotiate for better interest rates or get a higher credit limit. An Add on Credit Card is convenient for students to build their credit score.

You can get rewards with Credit Card purchases

With most Credit Cards, you can earn reward points with every purchase. You can redeem the reward points through cash or brand vouchers across groceries, restaurants, lifestyle, travel, etc. Some Credit Cards also offer air miles that you can redeem to get discounts while purchasing air tickets.

It can be useful during an emergency

Add-on Credit Cards are especially beneficial for international students. They can serve as a last resort when there’s no other way to finance your urgent cash needs when overseas.

HDFC Bank offers a wide range of Credit Cards for varying individual needs. Most of our cards offer reward points with every purchase. Depending on the card, you can also enjoy domestically and internationally airport lounge access. Our tie-ups with some of the top brands offer discounts and cashback when you shop with them, allowing you to save more.

Give your loved ones an Add-on Credit Card with HDFC Bank Credit Cards. Apply now.

* Terms & conditions apply. Credit Card approvals are at the sole discretion of HDFC Bank Ltd. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances