Secured vs unsecured: the key difference
Every credit card lets you borrow the bank's money and repay it later. The difference is what protects the bank:
| Secured credit card | Unsecured (regular) credit card | |
|---|---|---|
| Protection for the bank | Your fixed deposit | Your income and credit score |
| Income proof | Not needed | Usually needed |
| CIBIL score | Not needed | Usually 700+ |
| Approval | Usually simple | Often slow, often rejected without history |
| Limit | Linked to your FD | Based on income and score |
| Builds CIBIL | Yes | Yes |
Read what an FD credit card is for a plain-language explanation.
How a secured credit card works in India
- You open an FD of the minimum amount or more, in your own name.
- The bank places a lien on the FD. It stays yours and earns interest, but you can't withdraw it while the card is active.
- The bank sets your limit as a share of the FD, often 75% to 90%.
- You get a normal credit card with a number, expiry and CVV.
- You spend and pay a monthly bill like any card.
- The bank reports your account to credit bureaus every month.
- You close the card after paying all dues, and the lien is removed.
Who a secured card is for
- Students aged 18+ with no income. See student credit card without income.
- 18-year-olds starting a credit history. See our page for students who just turned 18.
- Freshers waiting for their first salary slip.
- Homemakers and freelancers without regular income on paper.
- People with a low or damaged score who want to rebuild.
It's less useful if you already earn well and have a good score, because you'd qualify for a regular card with a higher limit and more benefits.
What limit to expect
Your limit depends on the FD, not your income. As an illustration at 80%:
| FD | Example limit | Healthy monthly spend (under 30%) |
|---|---|---|
| ₹2,000 | ₹1,600 | about ₹480 |
| ₹5,000 | ₹4,000 | about ₹1,200 |
| ₹10,000 | ₹8,000 | about ₹2,400 |
| ₹25,000 | ₹20,000 | about ₹6,000 |
The exact percentage is set by the bank. Read how much limit you get on a ₹2,000 FD card.
Fees and charges to compare
| Charge | What to look for |
|---|---|
| Joining fee | Some secured cards have none |
| Annual fee | On a small FD, a high fee can outweigh the FD interest |
| Interest rate | Only matters if you don't pay in full, but it's high |
| Late payment fee | Avoid with autopay |
| Cash withdrawal fee | Avoid using the card at ATMs |
| FD interest rate | Usually the bank's normal FD rate |
Benefits of a secured card
- Easy approval without income or a score.
- Your own credit history, reported against your PAN.
- Your money keeps earning FD interest.
- A built-in safety limit, so mistakes stay small.
- A path to better cards once you have a score.
Drawbacks to know
- Your FD is locked while the card is active.
- The limit is small unless you deposit more.
- Fewer rewards than premium cards.
- Late payments still hurt your score. The FD protects the bank, not your CIBIL.
How to use a secured card to build a strong score
- Put one or two small bills on it each month.
- Keep the statement balance under 30% of the limit. Read credit utilisation explained.
- Set autopay for the total amount due.
- Don't apply for other cards for at least six months.
- Check your report after about six months.
For the full method, read our CIBIL plan for students.
Moving from a secured to a regular card
After 6 to 12 months of clean use, you'll usually have a score. From there:
- Your bank may offer an upgrade to an unsecured card.
- Or you can apply for a regular card once you also have income proof.
- Keep the secured card open if it's free, because it's your oldest account.
Is a secured credit card safe?
Yes, when it's issued by a regulated bank and applied for through the bank's own process. Never pay an agent a fee, and never share your OTP. Read is an FD credit card safe?
Example
Sahil, 18, from Jaipur had just started college and was turned down for two regular cards. He opened a ₹2,000 FD and got a secured card with a ₹1,600 limit. He paid his ₹249 recharge with it every month by autopay. After eight months he had a score above 740, and his FD had earned interest the whole time.
How to apply for a secured card as a student
You need to be 18 or older with your own PAN, Aadhaar linked to your mobile and ₹2,000 for the FD. Check the student credit card eligibility page, or leave your name and number in the form below. Our team will call you and help you apply online.
Key takeaways
- A secured credit card in India is backed by your own fixed deposit.
- It needs no income proof or CIBIL score, so it's ideal for students and first-time users.
- Your limit is a share of the FD, and the FD keeps earning interest.
- Late payments still hurt your score, so use autopay.
- After 6 to 12 months of good use, you can move to a regular card.
Bottom line
A secured credit card is the simplest way into credit in India. It trades a small, locked deposit for a real card, a credit history and a path to better cards. Use it lightly and pay in full, and it'll do its job. If you're starting with no history at all, read credit card without CIBIL score.
Frequently asked questions
What is a secured credit card in India?
A credit card backed by a fixed deposit you open with the bank. The FD secures the card, so you don't need income proof or a CIBIL score.
Is a secured credit card a real credit card?
Yes. It works online, in shops and for bills like any card, and your repayments are reported to credit bureaus.
What is the minimum deposit for a secured card?
It depends on the bank. For the card we help students apply for, the FD starts at ₹2,000.
Can I convert a secured card into a regular card?
Some banks offer an upgrade after a period of good use. Otherwise, your score from the secured card helps you get approved for a regular card.
Does a secured card have an annual fee?
Some do and some don't. Check the joining and annual fees before you apply, especially on a small FD.