FD-Backed Credit Cards: Worth It? Benefits, Risks, and Best Options Explored

• FD-backed credit cards offer easy approval for those without credit history, using a fixed deposit as collateral.
• These cards are ideal for students, first-time earners, freelancers, and those with low or no credit scores to build credit.
• Key benefits include straightforward approval, credit score building, and improving features like UPI payments and travel benefits.
• Drawbacks include locked-in funds, generally lower rewards than unsecured cards, and high interest on unpaid dues.
• To maximize benefits, use the card regularly but lightly, keep utilization under 30%, pay in full, and avoid closing it too soon.

Key Questions Answered

How do FD-backed credit cards help build or repair your credit score?

FD-backed credit cards help build or repair credit scores by providing a way to establish a credit history.

What are the key benefits of using an FD-backed credit card for first-time users?

FD-backed credit cards offer straightforward approval, especially for those without credit history. The credit limit is typically 75-90% of the FD amount, while the deposit continues to earn interest.

Which FD-backed credit cards offer zero forex markup for international travel?

The Axis Bank Privilege Easy credit card offers zero forex markup for international travel. Modern FD-backed cards, including some with zero forex fees, are available.