Recently, the number of student enrolments in secondary and higher secondary courses has increased sharply. Along with that, education expenditure has also witnessed a steep rise. A report by NSSO reveals that in urban areas, annual spending for higher secondary education is almost Rs.23,832 and for rural areas, it is nearly Rs.9,148.
Naturally, it often becomes challenging for working-class households to meet such expenses without putting considerable strain on their finances. In this situation, a student credit card can prove beneficial in managing higher study expenses with ease.
Following is a look at the features and application process for such a card to help students optimise their benefits from it.
Features of student credit cards
A credit card can prove to be an excellent financial tool that not only helps in tackling financial emergencies but also meet day-to-day expenses. Moreover, considering varying needs, there are specific types of such cards available, especially curated, to suit the needs of different users. A student credit card is one of them.
Although it functions like a personal credit card, it is also equipped with specific features, making it different from other such cards available. Following are a few of them.
Generally, a student credit card offers a lower credit limit of up to Rs.15,000. It ensures that students do not overspend using the card and only swipe when it is necessary.
It further helps users build a credit history from a very early age. This expedites the process of applying for credit cards in the future and further enables users to imbibe the habit of managing their finances effectively. Using this card, students can learn how to repay credit card debts without defaulting and subsequently avoid incurring debt.
The validity of a student credit card is generally 5 years as opposed to 3 years, as is normal for a standard credit card. This enables students to use the card in 10 ways and do more with it, including enrolling in new tuition, purchase books, study material and other educational purposes for a longer tenure.
Since this credit card is extended to students, the annual charges and other applicable fees are nominal. In fact, in most of the cases, they do not have to pay any joining fees either.
Rewards and offers
Another excellent feature of a credit card for students is that it accompanies several attractive offers and considerable reward points on every transaction.
Cards like Bajaj Finserv RBL Bank SuperCard also accompany exciting reward programs. For instance, using this card, individuals can earn up to 20,000 reward points as a welcome gift. Moreover, it also provides several other benefits that help students bear their higher study expenses conveniently.
This NBFC also extends pre-approved offers that make the credit card application process straightforward and hassle-free. Besides credit cards, these offers are also available on various financial products such as personal loans, business loans and others. Applicants can check their pre-approved offer instantly by entering name and contact details.
Nonetheless, before opting for this credit card, students also need to know about the eligibility requirements for the same.
Eligibility for student credit cards
Individuals can opt for this card with a bad credit history or without any history at all. It will further help them to apply for a credit card online in 3 steps.
The eligibility requirements include –
- The applicant must be 18 years of age.
- Individuals need to be in college or university.
- Few financial institutions provide a student credit card only if the parents open a fixed deposit account with them.
- Few other NBFCs also mandate to have a savings account with a specific minimum quarterly balance to be eligible for a credit card for students.
- In some instances, financial institutions issue this card only if the applicant avails an education loan with them.
The eligibility requirements, as well as, the application procedure vary with different lenders. Thus, before applying, contact the preferred financial institution to know about their online credit card application procedure.
Moreover, besides financial institutions, the Government is also now extending some specific financial tools like Bihar student credit card that are equipped with some additional features to help students fulfil their dream of pursuing higher studies. For instance, female students, transgender and divyang need to pay only 1% interest on these credit cards. One can look for such a card before applying, to optimise his/her benefits from the financial product.