Credit cards against Fixed Deposits

Credit cards are necessary in the modern scenario. Historically, they were unsecured loans. Now, banks offer credit cards against Fixed Deposits, connecting two random dots for mutual benefit.

How it works:

A lien is marked against your FD. This overcomes the risk factor for the bank. You get a credit limit of 80-100% of the FD value. Interest rates are lower than regular cards. You also get 45-60 days for repayment while your FD still earns interest!

Pros:

• No proof of income required.
• Lower interest rates.
• Repairs bad credit history.

Cons:

Defaulting will impact the liquidity of your FD. Interests will compound and boomerang on your savings figures.

Conclusion

This is the best option for those who need short-term credit but don't fulfill regular criteria. Use it for emergencies or necessary shopping and enjoy the flexibility.