Non-Resident Indians (NRIs), who live and work abroad, often face challenges when it comes to managing their finances. However, with the evolution of banking services, NRIs can now access a wide range of financial products, including credit cards, in India. Owning a credit card facilitates NRIs to transact in rupees but the terms and conditions for applying for NRI credit cards may vary from one financial institution to another.
Let’s explore the eligibility criteria, benefits, and considerations for NRIs applying for credit cards in India.
Eligibility criteria
Banks have recognized the importance of catering to the specific needs of NRIs and have introduced credit card offerings tailored for this segment. While eligibility criteria may vary slightly across different banks, some common requirements for NRI credit card applicants include:
NRI Status: To apply for a credit card in India as an NRI, individuals must hold a valid NRI status or possess an Overseas Citizenship of India (OCI) card.
Age and Income: Applicants are typically required to be at least 21-year old and have a steady source of income, either in India or abroad. The income requirements may differ based on the type of credit card and the issuing bank.
Bank Account: NRIs applying for a credit card in India must have an NRI account or an NRO (Non-Residential Ordinary) account with the issuing bank. This account is used for credit card bill payments and other related transactions.
Benefits of NRI credit cards
NRIs who obtain credit cards in India can enjoy a variety of benefits that cater to their requirements. You must check the credit card features before applying. Some advantages may include:
Accessibility and convenience: NRI credit cards allow individuals to access funds in India easily during visits or emergencies. They can be used for various purposes, such as shopping, dining, travel bookings, and online transactions, both in India and abroad.
International usage: Many NRI credit cards come with international acceptance, enabling NRIs to use their cards globally. This feature is particularly beneficial for frequent travellers or those who often take international trips.
Rewards and offers: NRI credit cards often offer rewards programs, including cashback, airline miles, discounts on travel, dining, and entertainment. These perks enhance the overall value and make credit card usage more rewarding.
Adhil Shetty, CEO, Bankbazaar.com, suggests, “Research the features and benefits of the credit card you intend to apply for, including rewards, cashback, travel benefits, and any associated fees and charges. Choose a card that aligns with your financial needs and spending habits.”
Online banking, bill payments: Online banking facilities allow NRIs to manage their credit card accounts, view statements, and make bill payments conveniently from anywhere in the world. Apart from some benefits, it is crucial to take into account the charges one must pay for using these credit cards. Individuals must read the terms and conditions and go through the charges for services they think they will be availing the most.
Currency exchange rates: When using an NRI credit card for transactions in a currency other than the Indian rupee, exchange rates and associated fees may apply. It is essential to compare exchange rates and assess the impact on overall costs.
Annual fees and interest rates: NRI credit cards may have annual fees and interest rates that vary depending on the type of card and the issuing bank. It is advisable to review and compare these charges to select a card that aligns with your financial requirements.
Shetty says, “The interest rates on credit cards in India may vary depending on the type of card and issuing bank. It is essential to compare interest rates and select a card with the lowest rate possible to minimize interest charges.”
Credit history and limits: Establishing a credit history as an NRI may be challenging, especially for individuals who have recently moved abroad. This can affect the credit limit initially offered on the card. Timely payments and responsible credit card usage can help build a positive credit history over time.
Security and Fraud Protection: NRIs should ensure that the credit card they choose offers robust security features and fraud protection measures. It is crucial to keep track of transactions, regularly monitor statements, and report any suspicious activity promptly.
It is essential to know that a credit score is a crucial factor in determining your creditworthiness. As an NRI, you may not have a credit score in India, but you can still build one by obtaining a secured credit card or a credit builder loan.
Benefits
- Annual fees and interest rates may vary depending on the type of card and the issuing bank
- NRI credit cards allow individuals to access funds in India easily during visits
- When paying for transactions in a foreign currency, exchange rates and associated fees may apply
