Student Credit Card: How Can You Obtain It
- Indrajeet Sharma
- Dec 9, 2024
- 9 min read
Updated: Dec 17, 2024
It is impossible to overlook the significance of student credit cards at a time when more and more students are investigating the advantages of digital payments and aiming for financial independence. From an early age, these financial tools assist pupils in developing a solid credit history. Numerous banks provide student credit cards that are customised to meet the specific financial needs of students since they recognise these needs. In addition to offering information on eligibility, benefits, and the paperwork needed to apply for a student credit card, this blog will walk you through the online application process.
Table of content
What is a Student Credit Card?
Student credit cards are made to accommodate college students' financial needs and offer the standard benefits of a credit card, like interest-free periods, rewards programs, and discounts. These credit cards, which come in secured or entry-level varieties, can be an excellent resource for teaching children about financial responsibility and the fundamentals of establishing their financial credibility. Students above the age of eighteen can apply for student credit cards from major card issuers like Kotak Mahindra Bank, ICICI Bank, and SBI Card.
How Can Students Obtain a Credit Card?
As the name implies, a student credit card is a particular kind of credit card intended for students who don't often have a credit score or a monthly income. Students can receive a stand-alone credit card from a card issuer, such as a bank, or a supplemental card to go with the credit card of a member of their immediate family. You can obtain the following credit cards as a student:
Add-on Credit Card: A credit card holder's supplementary credit card is known as an add-on credit card. A credit card holder can ask the bank to give their parents, spouse, or kids another card. These credit cards may offer the same credit limit as the principal credit card. When applying for the Add-on Card, the primary cardholder may, if necessary, select a lesser credit limit.
Credit Card with Fixed Deposits: A credit card linked to a fixed deposit (FD) account is another service that many banks provide. Typically, the given credit limit is expressed as a percentage of the fixed deposit's total amount. Additionally, in order for the FD to be eligible for credit cards, the bank may set a minimum principal amount and tenure restriction. Depending on the card type, these limits may vary.
Eligibility for a Student Credit Card
Since students don't have a monthly income or credit score, their age is usually the only requirement for credit card acceptance. Typically, 18 is the minimum age to apply for a credit card. However, different banks and credit card providers may have different eligibility requirements. You must provide evidence of address and a valid ID, along with passport-size photos and any other documentation the bank requests.
How to Apply for a Student Credit Card
The application procedure may vary based on the type of credit card. The following is a general guide to applying for a student credit card:
For add-on credit cards, a member of your immediate family who already possesses a bank credit card can apply for one on your behalf. They are required to complete and submit an Add-on Application Form to the bank. Alternatively, the credit card holder can apply for an Add-on Card through the bank's online banking interface.
For Credit Cards Against FDs: You must have an FD account with the bank in order to qualify for a credit card against FD. You can apply for a credit card against your FD in person at the bank branch if you meet the minimum FD amount and tenure requirements. You can also apply for one online using your mobile banking app or the internet.
Documents to Apply for a Student Credit Card
For young people, applying for a student credit card is a crucial first step towards financial independence. Successfully obtaining a Student Credit Card requires knowing the fundamentals, including age restrictions and required paperwork. The following documents are necessary in order to apply for the card:
PAN and Aadhaar cards
Most recent passport-sized photo ‘
Proof of enrolment in an educational institution may be one of the other frequently asked documents
Additionally, you could be required to provide evidence of income or guarantor information
Popular Student Credit Card Options in India
Credit Card | Annual Fee | Best Feature |
IDFC FIRST WOW Credit Card | Nil | 100% of FD value as credit limit and cash withdrawal limit 4X reward points |
Kotak 811 #DreamDifferent Credit Card | Nil | Credit limit up to 90% of your FD amount |
ICICI Bank Student Forex Prepaid Card | Rs. 199 | 40% discount on excess baggage 20% discount on DHL courier service |
ICICI Coral Contactless Credit Card | Rs. 500 | 2 reward points for every Rs. 100 spent |
SBI Student Plus Advantage Credit Card | Rs. 500 | Reward points to pay credit card outstanding bill 1 reward point for every Rs. 100 |
Government-Issued Student Credit Card Options
Students in states like West Bengal and Bihar can finance their education by using stand-alone credit cards:
West Bengal Student Credit Card Scheme
Students in the state can enrol in secondary, upper secondary, undergraduate, graduate, and professional degree programs with linked institutions both domestically and abroad under this program. Students enrolled in coaching programs can also take advantage of the program to prepare for a variety of competitive exams in fields like engineering, medicine, and the civil service. The Student Credit Card Scheme may be offered by public and private sector banks, as well as cooperative banks and the central and district central cooperative banks that are linked with them in the state. The highest loan amount available to students is ₹10 lakh, which they can repay over a 15-year period at an annual interest rate of 4%. At the time of application, students should not be older than forty. The Student Credit Card program is open to students who have lived in West Bengal for ten years or more.
Bihar Student Credit Card Yojana
Students living in the state can obtain an education loan of ₹4 lakh at 4% interest under the Bihar Student Credit Card Scheme. Only 1% of female and LGBTQ pupils, as well as kids with disabilities, are interested. Students can apply for this program if they want to pursue an undergraduate degree. Students must be under 25 years old and Bihar residents. In order to receive a polytechnic diploma, they should have finished their secondary school (10th standard) or upper secondary education (12th standard). Through the online portal or mobile app, qualified students can submit an online application for the Student Credit Card. They can sign up for the program by providing their email address or mobile number along with the one-time password (OTP) that was sent to them. Along with proof of admission to the higher education institution, they must present documents like their Aadhaar card and their prior qualification marksheets. The applicant also needs to provide proof of identification and address, copies of their bank passbooks, and passport-sized pictures of their parents or guardians.
Benefits of Student Credit Cards
It raises credit scores. The way you pay off your debts determines your credit score. Credit card payments and loans are examples of debt. People with incomes may usually take on such obligations. Having a high credit score is essential for your financial well-being. You have a better chance of getting a loan if your credit score is high. Additionally, you can raise your credit limit or bargain for lower interest rates. Students can easily raise their credit score by using an Add-on Credit Card.
Using a credit card to make purchases can help users earn rewards. Every purchase you make with the majority of credit cards can earn you reward points. Reward points can be redeemed for cash or brand vouchers that can be used for travel, dining, grocery, lifestyle, and other purchases. You can use the air miles that certain credit cards give to save money on airline tickets.
In an emergency, it could be helpful. International students particularly benefit from add-on credit cards. When there are no other options for funding your immediate financial demands when travelling abroad, they can be used as a last resort.
Conclusion
College students might build credit and make easy purchases using a student credit card. It's crucial to comprehend how interest works and how long it can take you to pay off your amounts before making any purchases with your credit card. Additionally, you might be able to take advantage of a rewards program that allows you to accrue reward points or cash back. Furthermore, a lot of student credit cards have student-focused benefits.
FAQ
Q1. Which card is the best for students?
Leading card issuers including SBI, ICICI, and Kotak provide student credit cards in India. ICICI Bank Student Forex Credit Card and SBI Student Plus Advantage Credit Card are two of the best student credit cards.
Q2. What is a student credit card?
A student credit card is specifically designed for young adults or college students, offering lower credit limits, simpler requirements, and the opportunity to build credit early.
Q3. What are the eligibility requirements for a student credit card?
Typically, applicants must be at least 18 years old, enrolled in a college or university, and have a steady source of income or a co-signer, depending on the bank’s policy.
Q4. Can a student get a credit card without a job?
Yes, students can get a credit card even without a job if they have a co-signer (like a parent) or a stable source of income, such as a scholarship or financial aid.
Q5. How can a student credit card help build credit?
By making timely payments and keeping the credit utilization low, a student credit card helps build a good credit history, which can be beneficial for future loans and credit applications.
Q6. Do student credit cards have annual fees?
Many student credit cards come with no annual fee, but some may charge a small fee depending on the benefits offered. It’s important to check the terms before applying.
Q7. Can I get rewards with a student credit card?
Some student credit cards offer rewards, such as cashback or points for purchases. However, the rewards may be limited compared to regular credit cards.
Q8. Is it hard for students to get approved for a credit card?
While it may be harder for students without credit history, many banks offer credit cards specifically designed for students, making the approval process easier.
Q9. What is the credit limit on a student credit card?
The credit limit on a student credit card is usually lower than on regular credit cards, typically ranging between ₹10,000 and ₹25,000, based on your creditworthiness.
Q10. Are student credit cards useful for emergency expenses?
Yes, a student credit card can be useful in emergencies. It gives access to quick funds, but it’s important to repay the balance as soon as possible to avoid interest charges.
Q11. Can a student credit card be upgraded to a regular credit card?
Yes, many banks allow students to upgrade to a regular credit card after demonstrating responsible usage for a period of time, typically 6 to 12 months.
Q12. How do student credit cards differ from regular credit cards?
Student credit cards typically offer lower credit limits, simpler approval processes, and may have fewer perks than regular credit cards. They are designed to help students establish a credit history.
Q13. What happens if a student misses a payment on their credit card?
Missing a payment can result in late fees, interest charges, and a negative impact on your credit score. It's important to set reminders and pay on time to avoid these issues.
Q14. Are there any special student benefits with credit cards?
Some student credit cards offer perks like no annual fees, cashback, or educational resources to help manage finances and build good credit habits.
Q15. Can international students apply for a student credit card?
Yes, international students can apply for a student credit card if they have a valid visa, PAN card, and a local bank account in India. Some banks may require a co-signer.
Q16. How can students use a credit card wisely?
Students should use credit cards responsibly by paying bills on time, avoiding overspending, and ensuring they don’t accumulate debt. This helps build a good credit score for future financial needs.
Q17. Is it possible to get a credit card as a student?
Yes, card issuers offer secured credit cards, add-on credit cards, and credit cards secured by student loans to students. You can also obtain a West Bengal Student Credit Card or a Bihar Student Credit Card if you live in both states.
Q18. Can minors get student credit cards?
Add-on credit cards are available to minors. Students as young as 15 years old can apply for add-on credit cards from certain institutions.
Q20. How can I get a credit card at the age of 18?
Generally speaking, in order to obtain a credit card that is principally in your name, you must be at least eighteen years old, or in certain situations, twenty-one. However, if you are 18 and ineligible, you might want to think about getting a student credit card if you are attending an accredited school, a secured credit card with a fixed deposit, or an add-on credit card with your parents or guardians as the primary cardholder.
Q21. What is the maximum credit limit on a student credit card?
Every student has a different credit limit set to them. After your application is accepted, the credit limit will be communicated to you by the card issuer.
Q22. Can international students use secured credit cards?
Yes, students studying abroad can use credit cards issued against fixed deposits. However, every transaction includes a foreign transaction fee. ATM withdrawals will also be subject to finance charges and cash withdrawal fees.
Q23. How much interest is charged on the Bihar Student Credit Card?
The Bihar Student Credit Card has an interest rate of 4%, but females, transgender people, and people with disabilities are eligible for a discounted rate of 1%. A simple interest basis is used to calculate the interest.
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