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10 Tips To Consider Before Going To Opt Your First Credit Card


Credit cards are potent financial instruments which, when used carefully, can unlock doors to generate a strong credit history. But how precisely is one meant to get their first credit card? There are some details you must consider when applying for your first credit card, whether you're an 18-year-old student with no credit background or a 30-year-old citizen who has already used cash or debit cards for transactions. It can be a difficult job to apply for your first credit card. There are also tons of credit cards accessible on the industry and many frightening stories about their abuse. If you have no credit card background, while applying for one, try to read more about what you can experience and learn how to better use your new card to reap financial benefits. For the same scroll down and read some facts that are a matter of concern.

10 Tips To Consider Before Going To Opt Your First Credit Card

1. The numerous forms of credit cards in India are really important for you to identify. For instance, you can go for a novice level credit card with a cheap annual fee if you are unfamiliar with credit cards.

2. In order to confirm your reimbursement ability, the credit card issuers can request your income details. While searching for a credit card, your income occupies a significant part. It is confirmation to the issuer that your credit card bill will be covered by you on or before the time limit. And obviously, with the rise in your salary bracket, the card options also rise.

3. At first, you will often be issued with a low credit cap by credit card issuers to minimise the detriment. The lenders themselves will allow you the possibility of increasing your credit limit once you get used to handling your credit card. The credit cap is also correlated with your revenue, meaning your credit limit can be capped by your revenues if you have a low income source.

4. As they provide details which you adhere to when using the card, it is necessary to care about all the terms and conditions. Learn about the APR nature of the card, the relevant charges, rewards and all the other essential information. Take enough consideration to learn the terms and conditions of before applying for a new card.

5. When you settle your credit card debt in full and promptly you do not need to pay any interest charges. But according to the card's (Annual Percentage Rate) you will be billed interest on the balance if you do not settle within the specified deadline. Commonly, the APR varies from 30-40%.


6. The interval during which the lender does not owe any interest if you settle the balance in full and before the due date of payment is termed as a grace period. The duration of grace begins from the end of the billing cycle to the next billing date. You will be charged interest on the outstanding amount if you miss the grace period for not settling the balance in full before the deadline.

10 Tips To Consider Before Going To Opt Your First Credit Card

7. Remember to confirm all the relevant card-related fees and charges such as joining fees, annual fees, finance charges, transfer fees, cash advance fees, overseas transaction fees, over-limit charges and so on. Before you get encumbered with unforeseen costs, make sure you know all these details.

8. You must need to be familiar with the penalty that you may incur to pay off the balance later than the deadline of the supposed bill. You can not only face additional charges if you miss a payment, but the lenders can disclose your missed payment to the credit reporting agencies, which will affect your credit rating and reduce your credit score in return.

9. Regardless of your credit cap, it is important to keep a balance on how much you spend. The credit utilisation ratio still impacts your general credit performance, but even though your lending history is great, a higher utilisation ratio will not be deemed healthy. If you are using more than 30-40% of the capacity of your card, your credit score will be decreased and in terms of reimbursing your card balances, you will face a significant risk.

10. Your credit score is influenced by the credit card as it determines the financial preferences and debt recovery. Credit cards will have a poor effect on your credit score if you overcharge your credit card by consuming above than the specified or default credit cap.


On the right side, applying for the first credit card is a big achievement, but on the other, a challenge which is not so convenient to do. You ought to thoroughly comprehend how a credit card really functions and peruse all the terms and conditions relevant to it closely. Until going for one, knowing the odds and outcomes will help you save capital as well as aid to create a positive credit score.

Read more about: credit card
Story first published: Saturday, January 2, 2021, 14:31 [IST]
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