Essential things to know before applying for your first credit card

From eligibility to the credit limit, know the important factors.
Essential things to know before applying for your first credit card
4 min read
26 July 2023

Credit cards undoubtedly are a clever way to pay for your regular purchases and big lifestyle expenses. Whether it is grocery shopping or booking flights, using credit cards for transactions can be rewarding in many ways. But to get a credit card that fits your lifestyle you must check a few factors before you apply.

1. Understanding the different types of credit cards

Selecting a credit card is a decision that requires a little research about the types of cards being offered by leading issuers. If you are new to credit cards, you can research beginner-level cards that come with a no joining or minimal annual fee. Whether it is travel, shopping at online stores, dining, or paying utility bills, by selecting the right credit card, you can maximise your perks.

As a beginner, you can explore Bajaj Finserv RBL Binge SuperCard – First-Year-Free Credit Card which has no annual fee for the first year yet offers features excellent benefits for a starter. Once you are confident about a responsible spending behaviour, you can apply for an upgraded card.

2. Eligibility criteria

Credit card issuers have different eligibility criteria, including age, income, employment status, and credit history. It is essential to check the minimum qualification required to avoid unnecessary rejections that may influence your credit score.

3. Rewards and benefits

Most credit cards come with attractive rewards and benefits such as cash backs, welcome bonuses, monthly milestones, reward points, or discounts at selected merchants. You can choose a credit card with rewards and benefits that match your spending lifestyle. If you are an avid online shopper, choose a card with high rewards for online spends. All Bajaj Finserv co-brand credit cards give you multi-fold rewards on all kinds of spends, check the list of those cards here.

4. Credit limit

The credit limit is the maximum amount you can spend on your credit card. It is essential to choose a credit card with a credit limit that is sufficient for your spending needs. With the Bajaj Finserv RBL Binge SuperCard – First-Year-Free you can get a card limit if up to Rs. 2,00,000.

5. Interest rates

The interest is the amount charged by the credit card issuer for borrowing on a credit card balance that is not paid off in full, each month. It is the cost of borrowing money from the credit card issuer and is expressed as an annual percentage rate (APR). It is important to compare interest rates and choose the credit card with the lowest interest rate.

For example: Let's say that you have a credit card with an annual percentage rate (APR) of 3.99% + GST per month, and you have an outstanding balance of Rs. 50,000. This means that if you do not pay off your outstanding balance in full by the due date in that month, you will be charged interest at a rate of 3.99% + GST on your outstanding balance for each month. So, in the first month, your interest charge would be Rs. 1,995 + GST, which is calculated by Rs. 50,000 x (3.99% / 12 months).

6. Income

Credit card issuers will request details about your income to assess your ability to repay. Your income holds significance when applying for a credit card, serving as evidence to the issuer that you can meet your credit card obligations. As your income bracket increases, your choices of available cards expand accordingly.

7. All the terms and conditions of the credit card

Understanding all terms and conditions is vital, as they outline the agreement you enter when using the card. Familiarise yourself with the card's APR range, applicable fees, reward mechanisms, and other significant details. Take the necessary time to carefully read the fine print in the terms and conditions.

8. Understand the functionality of the grace period

The grace period is a period during which the issuer refrains from charging interest on purchases if you settle the new balance entirely before the payment due date. This grace period spans from the conclusion of the billing cycle to the subsequent payment due date. Failure to pay the balance in full before the due date results in the loss of the grace period, leading to interest charges on the outstanding balance.

9. Credit card fees and charges

Ensure you thoroughly examine all pertinent fees and charges linked to the card. Key factors to monitor include joining fees, annual fees, finance charges, transfer fees, cash advance charges, foreign transaction fees, over-limit fees, and more. Acquaint yourself with these figures beforehand to avoid unexpected financial burdens.

10. Know how credit cards impact your credit score

Credit cards have an influence on your credit score, reflecting your financial decisions and debt management. Exceeding your credit card's limit by overspending can have adverse effects on your credit score. Understanding these dynamics is crucial to maintaining a positive credit standing.

In conclusion, before applying for your first credit card, consider these essential factors and choose a card that matches your spending and repayment capacity. It is important to manage credit responsibly and avoid overspending to maintain a positive credit score.


While care is taken to update the information, products, and services included in or available on our website and related platforms/ websites, there may be inadvertent inaccuracies or typographical errors or delays in updating the information. The material contained in this site, and on associated web pages, is for reference and general information purpose and the details mentioned in the respective product/ service document shall prevail in case of any inconsistency. Subscribers and users should seek professional advice before acting on the basis of the information contained herein. Please take an informed decision with respect to any product or service after going through the relevant product/ service document and applicable terms and conditions. In case any inconsistencies are observed, please click on reach us.

*Terms and conditions apply

Frequently asked questions

What is the first thing you should look at when applying for a credit card?

First, you should look at the credit limit, annual fee, interest rate on EMIs and joining fee of the credit card. Then, you can consider the types of reward points across categories and cash back offers to make the best use of your cards.

What are the 5 things to consider when applying for a credit card?

The 5 things that you must consider are

  1. Joining fee
  2. Annual fee
  3. Reward points
  4. Interest rates on EMIs
  5. Unique reward points