Karnataka Bank Credit Card Against FD

How Does a Secure Credit Card Work?

A credit card against FD is a secured credit card issued against a fixed deposit. Here, the FD acts as collateral and the credit limit is usually offered as 75% to 90% of the deposit amount, depending on the bank’s policy. It enables customers to take advantage of a credit facility without demanding proof of extensive income or a good credit score.

Karnataka Bank does not officially offer or list a credit card against FD on its website currently, but customers looking for this facility can explore similar FD-backed credit cards offered by other banks or NBFCs in India.

Top Banks Offering Card Against FD

The following is a list of banks offering a credit card against FD.

Features of Credit Card Against FD

Credit cards against FD have a few conditions and are favoured by people seeking credit with fewer hurdles in getting credit. Some of the main key features are outlined below:

• Easy Approval: A credit card attached to an FD is often simpler to obtain, since the bank has financial security with the amount deposited.
• Minimal Documentation: To get FD-backed secured credit cards, you do not require much documentation because an FD receipt fulfills the documentation requirement.
• FD-Linked Credit Limit: The credit limit is usually offered as a percentage of the fixed deposit amount, typically ranging between 75% and 90%.
• Suitable for First-Time Credit Users: These cards are commonly preferred by students, young professionals, and individuals with limited or no credit history.
• Supports Credit Score Building: Responsible usage and timely bill payments can help improve the user’s credit profile and CIBIL score over time.
• Interest continues on FD: Most of the banks will continue to pay the FD interest rate on the fixed deposit even when the customer avails the facility of his/her credit card.

Pros and Cons of Credit Card Against FD

Credit cards against FD can be a suitable option for individuals looking for easier access to credit, especially first-time users. However, like any financial product, they come with both advantages and limitations.

Closure Process of a Credit Card Against FD

The closure process of the credit card against FD is simple and some of the key steps are outlined below:

• Pre-clear Outstanding dues: In case you're proceeding with the closure request for the credit card, then outstanding dues such as EMIs must be paid off before the closure.
• Submit Closure Request: You can submit the closure request for your card online or by visiting a nearest branch.
• Physical Card Submission: Bank may ask customers to hand over the physical card for security measures.
• Confirmation to Receive: The bank notifies you that they have confirmed the FD account details, and confirms that the credit card has been cancelled.

Key Takeaways

Currently, Karnataka Bank offers credit card against FD. These cards are also known as secured credit cards because they are issued based on a fixed deposit, and the credit limits are typically 75% to 90% of the FD amount. Customers may check the other banks or NBFCs in India that offer such facilities.