What are Credit Card Eligibility Criterias & Required Documents

A credit card can significantly improve your credit profile and can also be an excellent savings tool. In India, where credit usage is not yet widespread, many people still view credit cards as a luxury rather than a practical financial tool.

Despite this, the credit card industry in India has grown at a compound annual growth rate (CAGR) of 20% over the past five years, with the number of credit cards exceeding 78 million by July 2022.

If you are considering applying for a credit card in India, you might be unsure about the eligibility requirements. Many people hesitate to apply because they fear they might not qualify. However, understanding the eligibility criteria can clarify this for you. In this blog, we’ll explore how credit card eligibility works, so let’s get started.

What Do You Mean by Eligibility Criteria for Credit Cards?

When you’re looking to get a credit card from a bank, it’s important to know the eligibility criteria. These are the conditions set by banks to determine if you qualify for a credit card. Typically, they include your age, income, and credit score.

Understanding these factors helps you figure out which credit cards you might qualify for, saving you time and protecting your credit score from being negatively impacted by unsuccessful applications.

While the eligibility criteria are generally similar across major banks, there may be slight differences based on each bank’s policies. Factors that affect eligibility include whether you’re salaried or self-employed, and your annual income and other credit obligations.

Credit Card Eligibility Criteria in India

Let’s take a closer look at the factors that affect your credit card eligibility in India:

1. Age: To apply for a Credit Card, you typically need to be between 18 and 60 years old. This age range ensures that applicants are legally adults and not approaching retirement. Some card issuers may have slightly different age requirements.
2. Income: Your income is an important factor in determining credit card eligibility. Banks require proof of a stable income to ensure you can pay off your credit card bills. Different types of credit cards have varying minimum income requirements, with premium cards generally needing a higher income.
3. Employment Status: Your job status significantly affects your credit card application. Those with a salaried position often have an easier time securing a credit card because they can provide evidence of a regular income. Self-employed individuals and entrepreneurs can also qualify, but they need to demonstrate a higher stable income.
4. Credit Score: Your credit score, ideally above 750, reflects your history of managing credit responsibly. This score is derived from your credit history, including previous loans, credit cards, and your repayment behaviour. A high credit score indicates that you are a low-risk borrower.
5. Residential Status: Both resident Indians and Non-Resident Indians (NRIs) can apply for credit cards. NRIs may need to provide additional documentation to verify their employment and living arrangements abroad.
6. Banking Relationship: If you already have an account with the bank, it might be easier to obtain a credit card. Your existing relationship with the bank can sometimes help offset lower credit scores or income levels.
7. Existing Loans and Liabilities: If you have other loans or significant debts, it can impact your credit card eligibility. Lenders evaluate your Debt-to-Income Ratio to ensure you can handle additional credit without becoming financially overextended.

Documents Required for a Credit Card Application

General Documents

These documents are commonly required for most credit card applicants:

• Proof of Identity: Aadhaar card, PAN card, passport, driving license, or voter ID card.
• Proof of Address: Aadhaar card, passport, driving license, voter ID card, utility bills (electricity, gas, water, telephone), or rental agreement.
• Income Proof: Salary slips, Form 16, bank statements, or ITR returns.

Extra Documents for Self-Employed Individuals

If you are self-employed, you might need to submit additional documents to prove your income and business operations:

• Proof of Business Ownership: Partnership deed, GST registration certificate, or business license.
• Income Tax Returns: Previous years’ income tax returns to demonstrate your income.
• Bank Statements: Business bank account statements to show income and expenses.

Extra Documents for Non-Resident Indians (NRIs)

NRIs must submit these documents to get a credit card in India:

• Passport: Valid passport with an Indian address.
• Overseas Address Proof: Utility bills, bank statements, or rental agreements from your overseas address.
• Indian Address Proof: If you own a property in India, you can submit property documents or rental agreements.
• Income Proof: Overseas income tax returns or salary slips.
• Visa/OCI Card: Proof of your visa or Overseas Citizen of India (OCI) card status.

Factors Affecting Credit Card Eligibility Criteria

1. Credit History: This shows your past financial behaviour, especially how consistently you’ve made credit payments. A positive history of timely payments improves your chances of approval, as it demonstrates that you are a reliable borrower.
2. Debt-to-Income Ratio: This ratio compares your monthly debt payments to your income. A lower ratio is better, as it suggests you manage your debt well and are less likely to have trouble with new credit.
3. Number of Existing Cards:Having several credit cards can be both beneficial and risky. While it might show your experience with managing credit, too many cards could raise concerns about your financial stability and affect your eligibility negatively.

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