October 23, 2026 · 9 mins read
Nowadays, a credit card is extensively used for various purposes, and the basic idea of a credit card is to make payments for the purchase of goods and services or to withdraw cash. However, a fixed deposit enables you to keep aside money for a definite period of time while also earning interest on the deposit.
When looking up online for FD credit card apply or a secured credit card, you can find different types of credit cards, along with their benefits, eligibility criteria and application procedures.
Table of contents:
1. Introduction
2. What is an FD & how does it work?
3. Does your FD earn any interest?
4. What is the credit card limit against your FD?
5. What happens if you miss a credit card payment?
6. Eligibility criteria to get a credit card against your fixed deposit
7. Things to consider before applying for an FD-backed credit card
8. Prime features of FD-backed credit cards
9. Advantages of getting a credit card against a fixed deposit
10. Can an FD-backed credit card help build your CIBIL score?
11. Conclusion
An FD Credit card is a secured credit card granted by a bank against a Fixed Deposit you hold with them. An FD-backed credit card makes use of that fixed deposit as security, providing you access to credit without withdrawing the deposit. The FD acts as collateral for the credit card, and the credit limit is usually determined by the amount deposited in the FD.
The bank places a lien on the fixed deposit (FD), which serves as collateral for the credit card. Therefore, the deposit cannot be easily withdrawn or closed until the lien is released, depending on the bank’s terms. This protects the card; hence, an FD-backed credit card is also known as a secured credit card. The credit limit is usually used to make eligible purchases and payments, while the fixed deposit keeps earning interest.
Nowadays, you can look for these FD-backed credit cards either directly via major Indian private, public or small finance banks or even digital lending platforms like ZET, which also offers a ZET FD credit card.
1. Discounts and cashback
2. Credit limit up to 90% of the FD amount
3. No annual fee or hidden costs
4. Enhance your credit score
5. 100% online application process
Your FD will continue to earn interest at the standard rate throughout the tenure. The only limitation is that you cannot prematurely close or break the FD while the credit card is active. If you decide to close the credit card, the FD is released.
The credit limit on a credit card against a Fixed Deposit is normally 80% - 90% of the principal amount deposited in your FD via a few banks, which may provide up to 100% based on their particular policy.
With online apps such as ZET you can also get an FD-backed credit card. The credit limit of the ZET FD-backed Credit Card is Rs. 2,000. You can also earn up to 7% interest on your fixed deposit. Besides, your seamless UPI payments are easily accessible.
If the outstanding dues on your FD-backed credit card are not paid in a timely manner, the issuer can recover the eligible outstanding amount from the linked FD as mentioned in the credit card application process.
The FD-backed credit card framework does not eliminate the need to pay your credit card bill. Timely repayment stays essential for managing the card and keeping up with a healthy credit history.
The issuer’s right to use the FD as security is applicable when the conditions stated in the card agreement are met. The deposit is not automatically used to pay every credit card bill.
To apply for a credit card FD, you need to meet the following eligibility criteria:
1.You must be a resident Indian citizen with a valid residential address in India.
2. In terms of age, you must meet the age requirement as stated by the card issuer, usually ranging from 18 - 65 years. However, various credit card companies may have differentiations in age restrictions. Hence, you should check with your credit card issuer beforehand.
3. To apply for this type of credit card, you should have a current Fixed Deposit account with the bank providing the card or be prepared to open one.
4. The minimum FD amount required to opt for these cards differs across banks with ZET offering an FD-backed credit card starting at just Rs. 2000.
Before you apply for an FD-backed credit card, assess the terms of both the FD and the credit card.
1.Look for the minimum FD amount, FD tenure, credit limit provided against the deposit, interest rate, joining or annual costs, finance charges, delayed payment costs and other applicable fees.
2. You should also understand how the FD is linked to the credit card, when the lien can be released in case a payment is missed, and the procedure for closing the card and withdrawing the FD.
3. If you are taking into account instant approval credit cards, examine the lender’s eligibility requirements and approval procedures. A decision related to approval does not change your responsibility to repay your credit card dues in a timely manner.
1. Collateral: The bank places a lien on the fixed deposit to secure the credit card against unsettled dues fixed deposit, which means that you cannot break or prematurely withdraw it until you close the credit card or pay off the dues.
2. Interest earning: Your fixed deposit continues to earn regular interest, even when locked as collateral.
3. No income proof needed: For beginners or those who want to rebuild their credit, this is an ideal option as it does not require salary slips, income tax returns or previous credit score or CIBIL history.
4. Builds credit score & history : Timely bill payments are reported to credit bureaus, facilitating you build or enhance your credit score.
For those who are new to credit or have a limited credit history, obtaining a credit card against a fixed deposit can be a strategic way forward. Here are some reasons why several people regard it as favorable:
1.Quicker approval - As the FD acts as collateral, approval is more accessible despite not having a high credit score or a consistent source of income.
2.Develops credit history - Using the card mindfully supports building or enhancing your credit score over a period of time.
3.Your FD and credit limit - You can get a credit limit of up to 90% of your FD amount, providing you access to funds without breaking the deposit.
4. Consistent interest earnings - While your FD serves as collateral for a credit card, it keeps earning interest, which you can estimate with a Fixed Deposit Calculator.
5. Reduced risk of rejection - Since your fixed deposit acts as collateral, the bank has an additional means of recovering unpaid dues. This may enhance your chances of approval, depending on the bank's eligibility criteria.
Banks consider a secured credit card like any other regular credit card. They habitually check your monthly credit usage, repayment history and outstanding balances with vital credit bureaus.
Moreover, the credit limit is backed by your fixed deposit as collateral, so banks do not demand a salary slip or a previous credit history for approval. Furthermore, you can notice your credit score improve or start updating within 3-6 months of appropriate use and reach a stronger score like 700-750+ within 6-12 months.
Additionally, some best practices to enhance your credit score are to always pay your total balance statement prior to the due date. A missed payment would usually adversely affect your credit score, and the bank can easily recover missed dues or interest by deducting them from your fixed deposit.
Credit utilization ratio is when you try to make use of only a small amount of your credit limit (ideally below 30%) each billing cycle. Avoid closing the credit card before the maturity date. A longer history of consistent, responsible repayments develops strong confidence in lenders in the long run.
In essence, though an FD-backed credit card offers several benefits, it is also significant to bear in mind its usage and the various consequences if the card is misused. If the card is used responsibly, paying your dues in a timely manner can help regulate your expenses while also ensuring that your savings goals or plans make steady progress.
1.What is an FD credit card?
A Fixed Deposit credit card is a type of credit card that is secured against a fixed deposit. This means that the credit card remains linked to your Fixed Deposit, which is used as collateral to secure the credit limit against the FD.
2.Is a minimum credit score required for the credit card?
No, a credit card against a fixed deposit does not require a minimum credit score. This makes it quite beneficial for those with a lower or no credit score and who are looking to avail of such a credit card and build their credit history.
3. Does an FD Credit Card increase CIBIL score?
Yes, an FD Credit Card helps enhance your CIBIL score. But to ensure that happens, you need to use this low-risk credit card mindfully and follow best practices like clearing credit card bills in a timely manner, keeping credit utilization low and using the same credit card consistently.
4. What is the minimum deposit amount for an FD Credit Card?
The minimum deposit amount for an FD-backed Credit Card will differ from bank to bank.
Contact
care@zetapp.in
Social
Build and Maintain a 750+ Credit Score
