A GUIDE to different types of credit cards

12 types of credit cards you must know of and when you become eligible to own one.

Convenient, quick, safe and trustworthy -- credit cards have become an inevitable part of our modern lifestyle. Knowing the type of credit card that suits the profile of the person concerned the best is important before selecting the card of choice.

With hoards of credit cards being issued by credit card companies, it becomes necessary for an individual to first know the various kinds of credit cards being offered by banks and financial institutions in India.

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1. Regular credit cards

This is the most basic type of credit card. It has a low credit limit and the most basic status among various credit cards. Credit card companies can club various other reward programmes like travel rewards, cash back offers etc to enhance its value and appeal to customers.

2. Silver credit cards

Silver credit cards have higher eligibility criteria than regular credit cards. They bring more benefits to the card holder as well as have higher credit limits than regular credit cards. For example the ICICI Bank Sterling Silver credit cards require salaried individuals to have an income of Rs 96,000 per annum while self-employed people need to have Rs 1,00,000 per annum as income.

3. Gold credit cards

Gold credit cards have a higher status and credit limits over silver credit cards. Thus the eligibility criteria needed for these cards is also higher than other cards. For example ICICI Bank American Express Gold card has income requirement of Rs 1,20,000 per annum for salaried individuals and Rs 1,00,000 per annum for self-employed people.

4. Platinum or Titanium credit cards

These types of credit cards bring more benefits to credit card holders than regular, silver or gold credit cards. These credit cards generally have platinum or titanium hue and are issued to a select class of clients who have excellent financial background and good income levels. Platinum credit cards have personal concierge services, in addition to exclusive platinum benefits.

5. Signature credit cards

A league of its own, the Signature credit cards usually have no pre-set spending limits, personal concierge service, signature travel, lounge and membership benefits. Offered to a very elite group, these credit cards require an excellent financial status. On June 9, 2007 ICICI Bank came up with the Visa Signature card and became the first credit card issuer in India to launch a premium credit card. This credit card has a joining fee of Rs 25,000 and no annual fees.

6. Credit cards by invitation only

These cards form the most elite form of credit cards and are given to customers only by invitation. This means no one can apply for these credit cards. For example, the American Express Black Credit Card, popularly called the Centurion Card, is issued by invitation to the most exclusive and elite, to those who spend a certain minimum amount (which can run into crores of rupees).

These cards have huge annual fees and minimum spending levels. In fact these credit cards are so exclusive, that they have an aura of mystery surrounding them and are considered as status symbols.

7. Reward cards

There are credit cards which offer rewards for specific kinds of purchases. For example the Airline Reward credit cards offer rewards on air travel, cash back credit cards offer cash rewards on every credit card purchases, fuel reward credit cards offer rebates on petroleum and other fuel purchases from specified outlets and preferred partners.

Similarly hotel reward credit cards give rebates on hotel stay and related expenses and health rewards credit cards give benefits on medical expenses, health treatments and related activities. The rewards offered by credit card companies in alliance with various brands and stores, make them more attractive for the credit card holders.

8. Business credit cards

These credit cards are issued to businessmen or corporate users which helps them in their business related activities and separates their business and personal expenses. For example the HDFC Bank Corporate Card comes with a unique 24x7 MIS availability online. The business credit cards are also a great way to promote your business.

The ICICI Bank Business Credit Card has an option for embossing of company name on the credit card.

9. Student credit cards

As the name implies these credit cards are especially designed for students and help them start their credit card journey. These credit cards bring lots of rewards especially suited for students, which help them save time, money and enjoy their student life. Student credit cards are a first step towards building credit history.

A good credit history goes a long way in creating a relationship with banks helping you secure much needed loans and credit in the future.

10. Special feature credit cards

Credit cards can also be grouped on the basis of their features. For example based on their introductory interest rates, credit cards can be low introductory interest credit cards, or 0 (zero) intro interest credit cards. The 0 intro interest credit cards provide interest free credit (0 per cent) for a specified time period, which is called the introductory period. Similar is the case with credit cards that come without any annual fee what so ever and are called no annual fee credit cards.

11. Balance transfer credit cards

Credit card companies provide lucrative offers with 0 per cent introductory interest or low introductory interest charges on balance transfers. This allows credit card holders to transfer the outstanding balances on their existing credit cards to a credit card with low or 0 interest on balance transfers. This brings them a lot of savings in the interest rates. The balance transfer credit cards may charge a balance transfer fees for every such operation.

12. Affinity credit cards

This is a special type of credit card which has a special tie-up or relation with an organisation, store, institution or company. This credit card carries the logo of the affiliated organisation on the card design and brings special benefits and discounts on products from that company. In case the affiliated company is a charity or non-profit organisation, a part of the credit card expenses go into the affiliate organisation's account.