Queries related to FD backed credit cards

[bozon]

Please assist me in fully understanding what an "FD" credit card is and its associated limitations. Are FD-backed credit cards, such as the IDFC First Wow cc operate exactly like normal unsecured credit cards? Are there any transactional restrictions? Explain in detail with your personal experience.

What are the acceptance rates for FD-backed credit cards for online foreign transactions? Explain in detail.

I've come across videos suggesting that it's possible to increase the FD limit for certain FD credit cards. Is this legit?

What is the typical FD tenure when opting for FD ccs and can one continue using such credit cards indefinitely?

Could you share your experience with the CIBIL score when it's submitted by FD backed cc issuers?

It is advisable to always keep a secured revolving credit like FD cc along with unsecured ones for healthier CIBIL score?
Could you outline everything I should consider before opting for an FD cc?

 

[Skylar]

Are FD-backed credit cards, such as the IDFC First Wow cc operate exactly like normal unsecured credit cards?

FD credit cards function similarly to regular unsecured credit cards. You can use them for purchases, online transactions, and cash withdrawals. They contribute to building or improving your credit score.

 

[Skylar]

Are there any transactional restrictions?

You can enable overlimit facility in credit card which allows you to use little more than your credit limit with processing fees and charges.
But in case of FD card, you are limited to the amount you do the FD.

 

[Skylar]

I've come across videos suggesting that it's possible to increase the FD limit for certain FD credit cards. Is this legit?

Legit! but works with only few banks.

 

[Skylar]

What is the typical FD tenure when opting for FD ccs and can one continue using such credit cards indefinitely?

The FD tenure can vary depending on the bank's offerings. But If bank decides to convert your secure card to unsecure than you'll be informed and you can close the secured and opt for unsecured card.

 

[Skylar]

It is advisable to always keep a secured revolving credit like FD cc along with unsecured ones for healthier CIBIL score?
Could you outline everything I should consider before opting for an FD cc?

If you already have an unsecured card, there is no need for a secured card.

For instance, the total credit limit of all my unsecured cards amounts to 1,243,000,
TransUnion (TU) recommends maintaining a healthy credit mix that includes both secured loans (such as home loans or auto loans) and unsecured loans (such as personal loans and credit cards).

However, obtaining a 50,000 FD-backed card would not significantly balance out with the 1,243,000 unsecured cards. The FD card represents merely 4% of my total unsecured loan amount, and the weightage of credit mix contributes only about 10% to your credit score, having minimal impact.

 

[bozon]

FD credit cards function similarly to regular unsecured credit cards. You can use them for purchases, online transactions, and cash withdrawals. They contribute to building or improving your credit score.

Great! Thank you for the clarification. And like an unsecured credit card, FD credit cards can also be used for international transactions right? I guess IDFC wow credit card could be a good option for that.

 

[zacobite]

Great! Thank you for the clarification. And like an unsecured credit card, FD credit cards can also be used for international transactions right? I guess IDFC wow credit card could be a good option for that.

idfc wow is the popular card now

 

[Skylar]

I guess IDFC wow credit card could be a good option for that.

Yeah, you can consider that card as it has Zero markup fee.
But, consider the following scenarios. If you’re a frequent international transactor, you can deposit 2 to 5 lakhs and utilize the card. However, if it’s a one-time international transaction, creating an FD specifically for this card is not advisable.

 

[bozon]

Yeah, you can consider that card as it has Zero markup fee.
But, consider the following scenarios. If you’re a frequent international transactor, you can deposit 2 to 5 lakhs and utilize the card. However, if it’s a one-time international transaction, creating an FD specifically for this card is not advisable.

Yes absolutely. Thanks a lot! I appreciate the elaborated response.

 

[Skylar]

Yes absolutely. Thanks a lot! I appreciate the elaborated response.