Benefits Of A Credit Card Against Fixed Deposit (FD)


When it comes to managing finances, understanding the advantages of different financial tools is crucial. Two popular options that often come into comparison are credit cards and fixed deposits (FDs). Each has its unique benefits, but using a credit card against a fixed deposit is a strategy that combines the best of both worlds. In this blog, we will explore the benefits of a credit card against FD and how it can enhance your financial flexibility and rewards.

The Concept of Credit Card Against FD

A credit card against FD is a secured credit card where the fixed deposit acts as collateral. This type of credit card is beneficial for individuals with low or no credit history, as it offers a chance to build or improve their credit score. Banks issue these credit cards with a credit limit, usually a percentage of the FD amount, providing a risk-free way for banks to offer credit.

Benefits of Using a Credit Card Against FD

1. Building Credit History

One of the significant advantages of a credit card against FD is the opportunity to build or repair your credit history. Regular use of the card and timely payments can positively impact your credit score, making it easier to qualify for unsecured credit cards and loans in the future.

2. Higher Approval Chances

Since the credit card is secured by the FD, banks are more willing to approve the application, even for individuals with poor or no credit history. This makes it an excellent option for students, first-time credit card users, or those looking to rebuild their credit.

3. Leverage Your Savings

By using a credit card against FD, you can leverage your savings to access credit without liquidating your fixed deposit. This means your investment continues to earn interest, while you also enjoy the benefits of a credit card.

4. Interest Earnings on FD

Despite the credit card utilisation, your fixed deposit continues to earn interest at the agreed rate. This dual benefit allows you to maintain your investment growth while also enjoying the perks of a credit card.

5. Rewards and Cashback

Using a credit card against FD can help you earn rewards, cashback, and other benefits on your spending. For instance, rent via credit card payments can earn you points or cashback, which can be redeemed for various perks, adding more value to your everyday transactions.

Comparing Credit Card Against FD with Traditional Credit Cards

While traditional credit cards offer numerous benefits, they often require a good credit score for approval. A credit card against FD, however, provides similar benefits with easier eligibility criteria, making it an attractive option for those with limited credit history. Here’s a comparative look:

Approval and Eligibility

  • Traditional Credit Cards: Require a good credit score and income proof.
  • Credit Card Against FD: Easier approval with minimal eligibility requirements since the FD acts as collateral.

Credit Limit

  • Traditional Credit Cards: Based on your creditworthiness and income.
  • Credit Card Against FD: Typically a percentage of the FD amount, offering a clear and straightforward credit limit determination.


  • Traditional Credit Cards: Unsecured, posing a higher risk to banks.
  • Credit Card Against FD: Secured by the FD, reducing the bank’s risk and ensuring higher approval chances.

Benefits of Using an Airtel Credit Card

The Airtel credit card stands out as an excellent choice for those looking to use credit wisely. Here are some of the benefits it offers:

1.   High Credit Limit

The Airtel credit card provides a high credit limit of up to ₹5,00,000, ensuring you have ample credit for your needs.

2.   Annual Savings

You can save up to ₹16,000 annually through various rewards and cashback offers, making your spending more rewarding.

3.   Low Annual Fees

The Airtel credit card comes with low annual fees, making it an economical choice for those looking to benefit from credit card perks without high costs.

4.   100% Digital Process

The application and management of the Airtel credit card are entirely digital, providing ease of use and convenience.

5.   Relaxed Eligibility Criteria

The eligibility criteria for the Airtel credit card are relaxed, with an age range of 18-70 years, making it accessible to a broad demographic.

6.   Exclusive Discounts

Airtel credit cardholders enjoy exclusive discounts and offers, adding more value to their everyday spending.

Using a credit card against a fixed deposit offers a unique combination of benefits, including building credit history, leveraging savings, and earning rewards. It provides an accessible way to enjoy the perks of a credit card with the security of an FD. The Airtel credit card further enhances these benefits with its high credit limit, annual savings, low fees, and digital convenience. By making informed choices and managing your finances wisely, you can turn a credit card against FD into a powerful financial tool.