0 hidden charges. 0 forex

Credit Cards Against FD: Meaning, Features, How to Apply

Reviewed by
Created on
May 4, 2023


What’s Inside

What is a Credit Card against FD?

A Credit Card against FD (Fixed Deposit), often a Secured Credit Card, is a type of credit card issued to individuals against the security of a fixed deposit account they hold with a bank or financial institution.

Why Apply for a Credit Card against FD?

You should apply for a Credit Card against FD if you:

  • Need a credit card but are unable to get one
  • Have an irregular income (or source of income)
  • Have a poor credit history/no history
  • Do not have income proof
  • Freelancers, homemakers, etc.
  • Have an entry-level job (with low income)

Difference between a Credit Card against FD (Secured Card) vs an Unsecured Card

Card features

Unsecured credit cards

Secured credit cards

Deposit required?



Minimum recommended credit score to qualify

Usually 670 or higher

Usually available for no credit history or scores below 669

Average APR

Usually over 20 percent

APRs tend to be lower for secured credit cards

Annual fee charged?


Usually not; a one-time, refundable security deposit is required

Helps build credit by reporting to credit bureaus



Rewards available?

Yes, with many rewards credit cards


How does a FD-backed Credit Card work?

1. Fixed Deposit Security

To get a credit card against FD, open a fixed deposit account with the bank. The amount you deposit serves as security. The bank may have a minimum deposit requirement.

2. Usage

You can use a credit card against FD just like any other regular credit card for making purchases, paying bills, and other transactions. The credit limit is your spending cap, and you must make monthly payments on the outstanding balance.

3. Interest Rates

Interest rates on credit cards against FD are generally lower than those on unsecured credit cards because the fixed deposit acts as security. If you fail to make payments, the bank can use the FD to cover the outstanding dues.

4. Builds Credit History

These cards can benefit individuals with limited or no credit history, as they provide an opportunity to build a positive credit history by making timely payments.

5. Approval Process

Approval for a credit card against FD is typically easier to obtain than an unsecured credit card because the bank faces lower risk due to the collateral. It's a good option for those who may have been denied a regular credit card in the past.

6. Fixed Deposit Tenure

These credit card is usually linked to the fixed deposit, so you cannot prematurely withdraw the FD until the credit card is closed or the bank releases the lien on the FD.

Features of Secured Credit Cards

1. Lower interest rates

Credit cards against FDs generally have lower interest rates compared to traditional credit cards, making them a suitable option for borrowing money against your FD without the worry of high-interest rates.

2. Improves your credit score

Using a credit card against FD can help you improve your credit score, making it easier for you to secure future loans. Once your credit score increases, you can easily apply for traditional credit cards with higher credit limits and more rewards.

3. Safety

Fixed deposits are considered a safe investment choice in India, as they generate impressive returns while ensuring your money stays secure. Using an FD-backed credit card is a no-risk option.

4. Minimal Documentation

With a credit card against FD, you don't need to submit any additional documentation because you already have an existing relationship with the bank.

Eligibility for a Credit Card against FD

  • You must be a resident Indian individual
  • You must be at least 18 years old
  • You should have a fixed deposit for a minimum time horizon of 6 months
  • You must have an active fixed deposit with the card issuing bank
  • Your FD must be free from other liens, i.e., not already marked as collateral for other credit facilities

Credit Limits of a Secured Card

The credit limit on your credit card is usually a percentage (often around 80-90%) of the amount you have deposited in the fixed deposit account. For example, if you have a fixed deposit of Rs. 50,000, your credit limit might be around Rs. 40,000 to Rs. 45,000.


Credit cards against FDs can be a great option for you if you may not be eligible for a traditional credit card due to low credit scores or lack of income proof. They offer several advantages, such as lower interest rates, the ability to earn interest on your fixed deposit while using it, and improving your credit score. Plus, they're backed by a safe investment choice, which makes them a no-risk option. And the best part is that you can use your fixed deposit for spending while it continues to earn interest!

Invest in Fixed Deposits 2.0 with Fi

Save and earn interest with deposits on the Fi app. Want to save for a Goa vacation? The new iPhone? Or a new house? Jars at Fi help you with your customised goal-based savings. These are smart deposits that give you up to 6.75% p.a. returns on your savings. 

Frequently Asked Questions (FAQs)

1. Which bank gives credit cards against FD?

Several Indian banks offer credit cards based on fixed deposits, including Federal Bank (Fi Money’s banking partner).

2. What is the minimum fixed deposit amount required to get a credit card?

The minimum fixed deposit amount for a credit card against FD varies from bank to bank.

3. Is it good to take a credit card against fixed deposit?

Using a credit card against FD responsibly can improve your credit score despite the low credit limit.

4. Does the credit limit of a credit card against FD increase?

You can increase your credit card limit by adding more money to your fixed deposit.

5. Will I get 100% of my fixed deposit amount as my limit for a credit card that is taken against an FD?

Credit limits on credit cards against FD are typically offered at around 80% of the amount deposited in the fixed deposit account by the bank.

6. What are the disadvantages of secured credit cards?

In order to obtain a secured credit card, you are required to have a minimum deposit, which then becomes locked for the entire fixed deposit tenure. If payments are not made on time, your deposit may be negatively impacted along with your credit score.


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
Share this article
Copied Link!
Credit Cards
Credit Cards Against FD: Meaning, Features, How to Apply


View similar articles in
Credit Cards
Get the Fi app