From paying utility bills to buying groceries, a credit card gives you the power to meet your financial needs securely and conveniently without any delays. If you’re planning to leverage your finances by availing a credit card, be informed about its various charges, features and rewards for best results. Apply for a credit card only after you understand its basic attributes to avoid any infiltration of debt in your financial life.

Here are the important points you should know before applying for a credit card.

You can choose from various types of credit cards
Lenders offer a variety of credit cards customised to meet your needs. So, avail the one that matches your lifestyle and offers you great rewards. Start by analysing where you spend most and find a card that offers rewards, cashbacks and discounts on such spends. For instance, you can go for a credit card if you travel frequently or get a fuel credit card if you drive to work every day, get discounts on booking stays or flights or save on petrol surcharge.

You need to qualify for a credit card
To get a credit card of your choice, you have to meet credit card eligibility criteria set by the issuer. These criteria help the issuer decide if you are creditworthy and have the ability to repay the credit. Here’s a list of the common eligibility criteria.

Your age should be between 25 and 65 years
You must have a steady income
You should have a good credit score
Your credit report should be clear of any defaults
If you have received any credit card offers via email or SMS for a credit card, it may be because you have been pre-approved for certain cards based on your credit score or past history with an issuer. In such cases, you do not need to prove your eligibility, and can instantly apply for the card.

You have to pay certain charges to avail the benefits of a credit card
Credit cards have various associated charges like joining fees, annual maintenance fees, ATM withdrawal charges and transaction charges, among others. While some issuers mention them beforehand, others don’t. Therefore, it is your responsibility to learn about all such charges before applying for a credit card. Consider a card that has minimal charges and offers maximum benefits. For instance, when you use a Bajaj Finserv RBL Bank Super Card you don’t have to pay interest charges on ATM cash withdrawals for up to 50 days and thus, save on interest fees.

You should avoid paying just the minimum balance on your credit card bill
When it comes to paying your credit card bill, most lenders offer an option to pay just the minimum amount to attract customers. However, bear in mind that even though you won’t be charged a late penalty charge, you still have to pay interest on the outstanding amount due. Run through these hypothetical numbers to get a better glimpse of how much interest you’ll end up spending.

Total credit card bill amount due: Rs.15,000

Minimum balance allowed by the issuer to avoid paying late penalty fees: Rs.5,000

Interest fee charged on the outstanding balance: 3% per month

Outstanding amount due after paying minimum balance: Rs.10,000 (Rs.15,000-Rs.10,000)

Interest amount charged: Rs.3,000 (Rs.10,000 X 3%)

This interest will accumulate over time if you just keep paying the minimum balance due every month. To avoid falling into a debt trap, make sure to make the full payment.

You can save money by making the most of reward points
Every credit card offers reward points on the transactions that you make using the card. Depending on the type of credit card you choose, you can earn reward points on what you spend. Apart from this, few credit cards also offer ample welcome points when you first join. For instance, the Bajaj Finserv RBL SuperCardcredits up to 20,000 reward points as a welcome gift. Most credit cards also offer reward points every time you achieve a spending milestone. You can redeem such points and use them to shop for merchandise online or via the partner sellers of your issuers. This may be in the form of flight tickets, electronics, lifestyle goods and more. Using these points can thus help you save on subsequent purchases, so make good use of them before they lapse.

Armed with these facts, you can apply for a credit card online or offline and boost your purchasing power. To make matters easier, check out your pre-approved offer online to get an instant approval for a credit card.