October 24, 2025 · 10 mins read
Santosh Kumar
A fixed deposit is one of the most preferred modes of investment in India, and an FD that also provides you with a credit card, i.e. a credit card against an FD, is a win-win situation for the risk-averse investors/customers and for those who wish to build/improve their credit score.
A credit card against a fixed deposit or FD is a secured credit card. Having a fixed deposit account is the prerequisite for getting a credit card against an FD. Many banks like SBI, SBM Bank (India), etc. offer this feature with their FDs.
The prime feature of this credit card is that the linked FD is lien-marked, i.e. acts as collateral. The credit limit is generally 80%-90% of the FD amount. It should be noted that the lien-marked FD keeps on earning interest.
In case the cardholder misses the payment of the monthly credit bill, the bank can redeem the linked FD to recover the outstanding amount. Fees and charges on a credit card against FD are usually lower than those on an unsecured card, and these cards are easily approved.
SBM Bank (India) Ltd., with Paisabazaar as a co-branded partner, has introduced a credit card against a fixed deposit – Step UP Credit Card. This card is designed especially to cater to the needs of an average salaried individual. The minimum FD amount is kept only at Rs. 2,000, thus making it quite affordable. This is a 100% pre-approved credit card and takes minutes to apply. While the FD in the bank earns guaranteed interest, the Step-UP card adds to the purchasing power of the depositor. Let’s look at its features.
The following are the prime features of the Step-Up credit card:
1: Flexible credit limit
2: Digitised application process – zero contact
3: Nil joining fee for FDs of more than Rs 5,000 (Rs. 250 + 18% GST for FD of up to Rs. 5,000)
4: Nil renewal fee
5: Helpful in building a strong credit score
Also Read: Difference Between Annual Fee and Joining Fee
Banks in India issue credit cards against fixed deposits only to individual residents with a fixed deposit. The following persons are not eligible to avail of this facility:
1: Minors
2: Foreign nationals
3: Third parties
4: Partnership firms
5: Trusts
6: Societies
7: Depositors of tax-saving FD
8: Depositors of NRI fixed deposits
Also, a credit card is not issued against those fixed deposits which are already marked as a lien (i.e. FD against which a loan/overdraft has been taken).
Also Read: Foreign Transaction Fees on Indian Credit Cards
A secured credit card against an FD is an ideal choice for those who:
1: Need a credit card but are unable to get one
2: Have an irregular income (or source of income)
3: Have a poor credit history/no history
4: Do not have income proof
5: Freelancers, homemakers, etc.
6: Have an entry-level job (with low income)
Those who have a bad credit history or an irregular income often find it difficult to get a credit card. In such cases, customers who have a fixed deposit can use their FD against which credit cards can be issued.
The following are some of the highlights of credit cards issued against fixed deposits:
1: Credit limit not decided by the bank; depends on the FD deposit amount (generally 80% – 90% of the FD amount)
2: A fairly low fee is charged, or no fee is charged, by some banks
3: Lower interest rates as compared to unsecured credit cards
4: No income proof required
5: No credit score required, but it helps build one
6: No cumbersome paperwork
7: Instantly accessible like a virtual Step-Up Credit Card
Also Read: Best Spending Categories to Earn Maximum Rewards
The features of a credit card against a fixed deposit are mentioned below:
Affordable FD amount - The minimum fixed deposit amount usually ranges from Rs . 10,000 to Rs . 20,000 and is hence affordable.
Credit limit - Credit limit offered on secured credit cards typically depends on the fixed deposit amount. Generally, banks offer 75% to 85% of the deposit amount as the total credit limit on the card.
Minimum documentation - To apply for secured credit cards, you do not need to submit a lot of documents.
Minimum tenure - The minimum tenure of the fixed deposit that you are giving as security to the bank should be six months.
Interest-free period - Generally, banks offer an interest-free period of 48 days to 55 days on secured credit cards.
Rewards - These cards offer multiple rewards, such as reward points, cashback, etc., to the customers.
Interest on fixed deposit - Cardholders will continue earning interest on their fixed deposit.
Also Read: Should You Use a Credit Card for High-Value Purchases?
Having a secured credit card provides the following benefits –
No income proof required: Have a credit card without any income proof. This is helpful for students, senior citizens, homemakers, freelance workers, etc.
Helps to build credit history: Having a credit history has become a norm to avail any credit-related products. Having a secured credit card and using it properly would allow you to build a good credit history.
Access to other credit lines: Once you have a credit history and the associated credit score, you will not have any problem applying for other loan products, including personal loans, home loans, auto loans, etc. Thus, secured cards introduce you to the world of credit.
Quick approval: Ensures instant approval of the credit card application upon booking an FD.
Also Read: When to Convert Credit Card Payments into EMI?
Following is a list of secured credit cards offered by some major banks in India, with important features:
Bank Name: SBM Bank (India) Ltd.
Credit Card Name: Step UP Credit Card
Minimum FD Amount: Rs. 2,000
Features:
1: Credit limit of up to 90% of the FD amount
2: NIL annual fee (Lifetime Free Credit Card)
3: Nil joining fee for FDs of more than Rs 5,000 (Rs. 250 + 18% GST for FD of up to Rs. 5,000)
4: Earn an FD interest rate of 6.50% p.a.
5: 1 reward point on every Rs. 100 spent
6: Helps in building/improving a credit score
7: No savings account required
8: Up to 50 days of interest-free credit period
Bank Name: State Bank of India
Credit Card Name: SBI Unnati Credit Card
Minimum FD Amount: Rs. 25,000
Features:
1: No annual fee for the first 4 years
2: 1 reward point per Rs. 100 spent
3: 1% fuel surcharge waiver of up to Rs 100 per statement cycle (on purchase between Rs. 500 – Rs. 3,000)
4: Milestone Rewards – Rs 500 cashback on achieving annual spends of Rs 50,000
5: Attractive offers & discounts from Zomato, Xiaomi, Amazon, ClearTrip, Ajio, MakeMyTrip and other top brands
6: Balance Transfer on EMI, i.e., transfer outstanding credit balances of other banks to SBI Card Unnati
Also Read: Online Shopping with Credit Cards – Safety Tips
Bank Name: ICICI Bank
Credit Card Name: ICICI Instant Platinum Credit Card
Minimum FD Amount: Rs. 50,000
Features:
1: No joining and annual fees
2: BookMyShow Offer – 25% discount of up to Rs 100 on the purchase of a minimum of 2 tickets
3: Dining Offers on TGI Fridays, Café Coffee Day, Pizza Hut, etc, through ICICI Bank Culinary Treats Program
4: Redeem reward points against multiple categories like Electronics, Travel & Luggage, Health & Beauty, Fashion and Lifestyle, e-Vouchers and Home & Kitchen.
Bank Name: Kotak Mahindra Bank
Credit Card Name: Kotak 811 DreamDifferent Credit Card
Minimum FD Amount: Rs 5,555 (for 811 saving account customers); Rs 5,000 (for Non 811 saving account customers)
Features:
1: Annual fee – NIL
2: Credit limit – 90% of the FD amount
3: Cash withdrawal is allowed up to 90% of the credit limit
4: 1% fuel surcharge waiver on all petrol pumps for transactions between Rs. 500 and Rs. 3,000 (Maximum Rs. 3,500 per year)
5: Up to 48 days of interest-free cash withdrawal from the date of purchase made
6: 500 bonus reward points on Rs 5,000 spent in the first 45 days
7: Milestone Program – Earn Cashback of Rs 750 or Get 4 PVR Tickets
Also Read: what is fd in credit card
Bank Name: IDFC FIRST Bank
Credit Card Name: IDFC FIRST WOW! Credit Card
Minimum FD Amount: Rs 10,000 (Rs 25,000 for NRIs)
Features:
1: Credit Limit – Minimum 100% of FD
2: Cash withdrawal limit is up to 100% of the FD value
3: Earn 7.50% p.a. FD interest rate
4: Up to 20% discount across 1,500 restaurants
5: Personal Accident cover of up to Rs 2 lakhs
6: 1% fuel surcharge waiver of up to Rs 200 on the transaction value of Rs 200 to Rs 5,000
7: Welcome Benefit – 5% cashback of up to Rs 1,000 on the first EMI transaction
8: 4 complimentary Roadside Assistance (RSA) of worth Rs 1,399 in a year through Global Assure
Also Read: how to get credit card against fd
Yes, you can apply for a credit card against an FD online, no matter whether you are a non-FD accountholder or an existing FD accountholder.
Yes, you can avail yourself of an interest-free period of 48 to 55 days through a credit card against an FD.
Yes, the credit limit of FD credit cards can increase by selecting multiple eligible FDs while applying for FD credit cards.
Yes, some banks allow you to withdraw money from an ATM up to 100% of the credit limit. The credit limit on your card will be 85% of your fixed deposit amount.
No, you cannot get 100% of your FD amount as a credit limit for credit cards against FDs, as banks usually offer around 80% to 90% of the amount of your fixed deposit as your credit limit.
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