As the name suggests, a student credit card is a credit card designed especially for students. These cards provide much needed financial aid to students and help with rewards on payments, free issuance, discounts on shopping and travel, etc.
A student in India can borrow as much as INR 10 lakh at a subsidized interest rate. This fund is provided by the state co-operative bank, affiliated with the central co-operative banks, district central co-operative banks, or the public or private sector banks. The concession on the interest is for the course duration.
In India, some state governments help students get student loans at a concessional rate have launched student card schemes such as West Bengal Student Credit Card Scheme and Bihar Student Credit Card Scheme. The plan aims to help students pursue higher education without financial constraints.
These plans seek to financially support students to pursue secondary, higher secondary, madrasah, undergraduate and postgraduate studies, including professional degrees and other equivalent courses in any schools, madrassas, colleges, universities and other affiliated institutes within and outside India.
Students studying in various coaching institutions for appearing in competitive examinations like engineering, medical, law, IAS, IPS, WBCS etc., can also avail of the loan under this scheme.
Who Can Apply for a Student Credit Card?
Students above the age of 18 years can apply for student credit cards. Since students are not earning members of society, credit cards have no income eligibility requirements.
A student credit card can help with the following:
1. Creditworthiness: Credit score has a significant impact on one’s life. Since college students don’t have an income stream, there is less chance of building creditworthiness. Thus, getting a student credit card allows you to build a credit score even before one starts earning—factors like limit utilization per cent, limit, and repayment schedule or timeliness in repayment impact your creditworthiness.
2. Emergency: Emergency can arise at any time. If there is an urgent need for funds, having a student card gives the individual more financial flexibility and stability.
3. Rewards: With a student card, you can reduce your expenses by utilizing discounts, cashback, bonuses, gifts, coupons etc., available on a wide range of consumables such as groceries, books, stationery, meals, travel, etc.
List of Best Student Credit Cards
- SBI Student Plus Advantage Card: The SBI Student Plus Advantage card provides many benefits to students. Students can apply for this card only if they have an education loan from the State Bank of India. They can also apply for it by providing a nominal fixed deposit.
To get the interest rate benefit, you can transfer the balance of any other credit card balance to a student card. Some advantages are when you book travel tickets for railways and airways discounts up to 10x rewards points. Other benefits are on paying utility bills and on international transactions.
The card doesn’t have an annual fee, and the holder gets up to 2.5% cash back for purchases made on groceries, fuel and related items.
- Axis Bank Insta Easy Credit Card: Axis Insta card is provided against a fixed deposit. The limit is a function of the deposit amount and is up to 80% of the deposit amount. The card offers attractive discounts on food and dining with a 1% fuel surcharge waiver.
- CICI Bank Student Travel Card: The ICICI Student Travel card is meant for students studying abroad. It can be used to pay application fees and course fees online or through a physical swipe. The card is powered by MasterCard and has a vast network worldwide.
Through this card, you also become eligible for the International Student Identity Card (ISIC) membership, which is tremendously valuable in its own right. The card can be used for travel, food, dining, fuel, etc.
- HDFC Bank’s ISIC Student ForexPlus Card: HDFC ForexPlus card is for students residing abroad and gives access to multiple currencies. The card is powered by both Visa and MasterCard and has wide acceptability. One of the attractive features of the card is that currency fluctuation doesn’t affect the user.
Application Process for Student Credit Cards in India
An application form can be filled out and submitted to the bank. For an application form, the following documents are required must be submitted:
- PAN or any other government-approved photo ID
- Aadhaar Card or any other government-approved address proof
- Birth Certificate
- College Identity Card or any other proof of enrolment
- Passport-size photographs
- Evidence of Education Loan and or Fixed Deposit (as per the credit criteria of the bank)
Bottom Line
A student credit card is a great tool that empowers students to manage their own expenses. It provides excellent flexibility while simultaneously inculcating financial discipline during the initial years of an individual’s career.
Student credit cards help build creditworthiness which can come in handy in the long run, especially for borrowing funds for personal or business reasons. The card also provides flexibility in cash management, mainly when used in cross-border transactions, as it improves mobility and conversion.
