Q. What is a secured credit card? Who can avail it? – Nagendra Sharma
A. Usually the credit cards you use are unsecured and not backed by any collateral. However, secured credit cards are backed by collateral such as Fixed Deposits. Unlike unsecured credit cards, the secured credit cards get quick approval. Secured credit cards come handy for people who don’t have a credit history, and may not be eligible for an unsecured card. If you fail to repay the bill on a secured credit card, the issuer has the option to adjust the outstanding amount from the collateral security. Interest on secured credit cards are usually much lower than the unsecured credit cards. If you are finding it difficult to get credit card due to lack of credit history, secured credit card could be a good option. It also helps you to build a credit history and later you can apply for an unsecured credit card or get a loan product.
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