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Things to Know Before Applying for Your First Credit Card

Written by - Akshatha Sajumon

April 11, 2022 6 minutes

Indian consumers were known to prefer the usage of cash while making any transaction. This scenario is fast-changing across the country as more young folks prefer to use credit cards due to the associated benefits. As consumers are quickly shifting to online shopping, credit cards can come in handy with various discounts, offers, and convenience of usage. 

Applying for a credit card for the first time can be a challenge for many due to the number of options available in the market, many of which have various terms and conditions in the form of fine print. However, as most consumers realise how important credit cards are for establishing a strong credit history, people are racing for credit card applications. 

Here are some of the important aspects to consider while applying for your first credit card.

Ask yourself – why do you need a credit card?

To maximise the benefits that can be derived from a credit card, you should ask yourself these questions before actually applying for one.

  • Do you need a better credit score?
    Some individuals apply for credit cards only to improve poor or non-existent credit history. With a good credit score, it’s easier to source credit or loans in the future. Asking yourself whether you need to have a credit card to improve your credit score will allow you to pick the right card.
  • Are you looking for discounts and offers?
    Credit cards may offer discounts, cashback, rewards, etc for shopping, booking hotels, flight tickets, and other spending. If you want to apply for a credit card for the first time and are looking to earn various rewards and discounts, then you must explore specific cards as per your spending requirements.
  • Do you need to make big-ticket spending?
    If you plan to buy certain expensive goods that you cannot afford through a cash purchase, a credit card may come in handy. Therefore, opt for a credit card that offers a higher credit limit. Some credit cards also offer an EMI option that can be used for heavy spending. In this case, you must look for credit cards that offer the EMI option without additional interest costs. 

Points to note before selecting the right credit card

Here are some of the important points to note while selecting a credit card for the first time:

  • Offers on the card – While selecting a credit card for the first time, you must go through all the offers that come with the selected or shortlisted credit cards. This will help you in narrowing down your choice depending on your spending preferences. For instance, if you travel often, it is ideal to go for a travel credit card. For frequent shopping needs, you can look for credit cards that have tie-ups with your shopping hubs. Credit card offers usually come in the form of discounts, rewards, waivers, cashback, etc.

Some of the credit card categories that are available in India are:

  1. Lifestyle cards
  2. Shopping cards
  3. Travel cards
  4. Fuel cards
  5. Rewards cards
  6. Business cards
  • Cost of card – While opting for a credit card for the first time, you must carefully go through the cost of the card. This comes in the form of annual charges, one-time application charges, renewal fees, etc. By looking at the waiver criteria of some of these charges, you will also be able to save the cost of owning the card. Some waiver criteria may be associated with your spending pattern. 

Here are some of the other credit card charges that you should know about –

  • GST
  • Late payment charges
  • Interest rate applicable on balance due
  • SMS alert cost
  • Cash withdrawal fees
  • Cash advance charges
  • Balance enquiry fees
  • Duplicate statement fees
  • Available credit limit –  Every credit card comes with a pre-defined credit limit. This limit is generally based on various factors like an individual’s income, age, credit score, credit repayment track record, etc. Before opting for a specific credit card, you must, therefore, clarify the exact credit limit on the card with the issuer. It is also important to check the maximum available credit limit on the card.
  • Credit terms – You must also check on the terms and conditions associated with various offers that come with the credit card. It makes sense to also verify the validity of these offers while opting for a credit card for the first time.


In a nutshell, it is important to take a self-assessment of personal requirements while selecting a credit card for the first time. A credit card’s fees, offers, payment options, etc. should align with personal preferences and spending needs. This will help in narrowing down on the right credit card that can be financially beneficial.


What is a credit utilisation ratio?

The credit utilization ratio is the amount of credit that is currently being used, divided by the total amount of credit available on the credit card. In simple terms, it is the amount currently owed divided by the available credit limit and is expressed in percentage form.

Is a credit card better than a debit card in India?

Credit cards allow users to spend through the available credit and pay for the same later. Debit cards directly deduct the amount spent from the individual’s bank account. Credit cards offer various discounts and cashback apart from a credit facility, whereas debit cards generally do not have many offers and discounts attached to specific spending types.

How do I know my credit card bill due date?

To know your credit card bill due date, you can check with the credit card issuer. Card issuers also send regular intimations to cardholders about bill due dates and the same can be found on the credit card statement too.

Are credit cards economical?

Credit cards can be economical if one uses them for the right type of expenditure on which the card has offers, discounts, cashback, etc. A credit card user needs to assess personal spending needs versus credit card features to ensure that it is economical.

How do I check my eligibility for a credit card?

To check eligibility for a credit card, one can go to the issuer’s website, where a list of criteria is generally mentioned. Alternatively, banks and issuers arrange for representatives to clarify the eligibility criteria once you enquire about a specific card.

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