Smart Money Moves: Unlocking the Benefits of Credit Cards Linked to FDs

credit card against fd

Credit cards are popular among people as they provide an immediate credit facility. They are recognised as a blessing as they make spending comfortable and more suitable. Also, it saves you from carrying cash all the time. Although, there are certain eligibility criteria that need to be fulfilled to be eligible for securing a credit card. 

When analysing credit card applications, card issuers consider your income and credit score. Now, it might become a challenge if you don’t have a steady income or a good credit score. This is where the credit card on FD comes into play. One of the specific variants of credit cards linked to FDs is the fuel credit card. This card type is designed to offer benefits and rewards tailored explicitly to fuel-related expenses.

In this post, let us acknowledge the theory of credit cards on fixed deposits, how they operate, their eligibility criteria, and everything you need to understand.

Understanding Credit Cards Linked to FDs

Credit cards on FDs are a type of secured credit card. A secured credit card determines the credit limit by the money you deposit as collateral. In this case, the collateral is a FD. The credit card issuer holds the FD as security, and the cardholder can access a credit line that is a percentage of the FD amount.

How Do Credit Cards Linked to FDs Work?

When you apply for a credit card linked to an FD, the card issuer will require you to open an FD account with them. They will then issue a credit card with a credit limit, usually 90% to 100% of the FD amount. Your credit limit decreases as you use the credit card for purchases and payments, but your FD continues to earn interest. Once you repay the credit card dues, your credit limit is restored.

Best Credit Card Offers: How to Choose Carefully

With numerous options, finding the best credit card offers can be tricky. To make a wise choice, look at things like interest rates, annual fees, rewards, and special deals when comparing them. It will help you find a card that fits well with your money situation and what you want to achieve.

Advantages of Credit Cards Linked to FDs

Credit cards linked to FDs come with various benefits that make them an attractive option for consumers: 

Lower interest rates

Interest rates on credit cards linked to FDs are generally lower than regular credit cards. Since the FD acts as collateral, the risk for the bank is lower, allowing them to offer more favourable interest rates.

Credit limit based on FD amount

The credit limit of these credit cards is directly related to the FD amount. By depositing a higher sum in the FD, you can secure a higher credit limit, giving you greater spending power.

Reward programs

Many credit cards linked to FDs come with attractive reward programs. Cardholders can earn cashback, reward points, or discounts on various transactions, making spending more rewarding. 

Avoiding credit card debt

As the credit limit is linked to the FD, you must stay within it, preventing overspending and accumulating credit card debt.

Emergency funds

Credit cards linked to FDs can act as a safety net in financial emergencies. You can use the available credit for urgent expenses without breaking your FD prematurely.

How to Apply for a Credit Card Linked to an FD?

It is a common question that arises in the mind of individuals “How do I apply for my credit card”. To apply for a credit card linked to an FD, you need to follow these steps:

● You will need to visit your bank’s branch or apply online on the website or app.

● You must open an FD account and complete the credit card application process.

● The card issuer will evaluate your eligibility based on your credit score, income, and FD amount.

Eligibility Criteria For a Credit Card On an FD

The eligibility criteria for a credit card can vary, depending on the purpose for which the card is applied. Here are some of the primary eligibility necessities listed below:

● Minimum tenure of FD account: 6 months

● The applicant must be at least 21 years old.

● Applicants must have a fixed-term deposit account with the relevant bank.

● Only available to Indian residents, not open to foreign nationals.

● The minimum value of an FD account for a secured credit card is between Rs 5000 to Rs 10,000.


Credit cards on FD offer many advantages for people who want to handle their finances responsibly. These cards come with lower interest rates, help build a good credit score, and provide rewards without worrying about getting in debt. These credit cards can be really useful for managing your money smartly.

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