Why do I need to create an FD to get a credit card?
There are several eligibility criteria based on which we issue a OneCard. Credit score, bank statement, salary slip, refundable security deposit, are some examples. Currently, your credit score doesn’t match our eligibility criteria, but you still can get a credit card as you fall in the group which needs to create a refundable security deposit with us, which is in the form of an FD.
And that is why you are being asked to create one. By simply creating this FD, the OneCard will be yours to enjoy! The credit limit of this card will be 110% of your FD amount, and the interest rate is 6.5% per annum. The FD is safe as it is with SBM Bank, an RBI approved bank.
Once you start using the OneCard and keep paying your dues on time every month - your score will start improving. If you don’t have a score - it will start building fast.
Parallelly, as you are using your OneCard, we will continuously track your score improvement at the back-end, and will keep offering you higher credit limits as your score keeps increasing. You will not have to increase your refundable security deposit (FD amount) to get these higher card limits. Then, the day you meet our credit score eligibility criteria, we will immediately reach out to you in the app with the good news and return your security deposit (FD), while you will still continue to be a proud OneCard owner!
That’s not all; once your credit score is high, other banks and lenders will give you larger loan amounts with lower interest rates and credit cards with higher credit limits.
My friend got a OneCard without creating an FD. Then why are you asking me to create it?
A lot of people you know must be owners of a OneCard and they never had to open an FD when they got the card. So why are you being asked to do so? Before we go ahead to answer the questions, we need to first tell you what a “credit score” is.
A credit score is a three-digit number that indicates to Banks and other lenders how likely you are to pay back the money you borrowed. Based on this, they decide whether to give you a loan/credit card or not and at what rate of interest/credit limit, respectively. In other words, they use this score to determine whether you are ‘worthy of credit’ or not. Hence, in financial terms, we say the credit score represents the ‘credit worthiness’ of a customer.
Your friend who got the OneCard would have met our credit score eligibility criteria. But there’s nothing to worry! You don’t have to wait any more for your score to meet our criteria. All you have to do is meet one of our other eligibility criteria - a refundable security deposit, by simply creating the FD in our app. You will become a OneCard owner soon after. It’s that simple!
As you use our card month-on-month and pay your bills regularly, your credit score will improve and you will soon meet that eligibility criteria too. As soon as that happens, we will immediately reach out to you in the app itself to let you know the good news and return your security deposit (the FD you created). You will still continue to enjoy the OneCard, just like your friend!
Ok… but is this FD safe? Will my money grow in this FD?
Absolutely! This FD you create is with SBM Bank, an RBI approved bank, and is completely safe. It is also 100% insured by DICGC. Also, it is a great investment, with an annual rate of interest of 6.5%, which is much higher than what other banks are offering today. Once you create this FD, you will get the receipt from the Bank in your email.
To put it simply, the FD is just a refundable security deposit, which also earns money for you. You earn interest on it while it’s there and we quickly return it once your credit score increases and meets our criteria.
A security deposit that earns you money. Beat that!
What if I want/need to close my FD in a few months after taking this card?
In 99% of the cases, our customers who create this FD and take the OneCard never want to close the FD midway because of the high-interest rate, the safety of the money they invested and the fact that using the OneCard is improving their score with every passing month. Yet, if you want to close your FD for any reason before your score meets our criteria, you can do it digitally in our app itself, any time! It’s instant and has no charges whatsoever. However, in that case, your credit card account will close too and you won’t be able to use it.
Your money will be refunded into your account within 3-4 working days.
Why can’t I just wait till I improve my score and meet your credit score criteria to get the OneCard?
Sure you can.
But the catch is that the only way to improve your credit score is to use a credit product consistently and repay in a timely manner. However, banks and other lenders prefer to give credit products to people who already have high scores. So your chances of getting a credit product are low. This will unnecessarily slow down the process of improving your credit score, when actually the sooner you start, the better it is for your future.
On the contrary, meeting our refundable security deposit criteria and getting the OneCard immediately is assured. Using the card thereafter and paying your dues regularly, is the easiest and quickest way to improve or build your credit score from scratch, without any further delay.
As you use this card month-on-month, your credit score will automatically improve, and we will let you know in the app itself as soon as you meet our criteria. We then return your security deposit (the FD) while you continue to enjoy the OneCard!
Can I check my credit score and track it on my own?
Yes! Just download the OneScore app to get your CIBIL & Experian score in less than 3 mins and keep tracking it every week yourself to see how it improves by just using our FD backed OneCard. In just a few months of you using the card, you will be able to see the progress.
If you still have any more questions related to why you should create this FD, go to the app and on the FD payment page, type out your question in the box at the end of the screen. Don’t forget to click on submit so that the question reaches us! We will get back to you with our answer within 2 working days.
This post was originally published on our OneScore blog, on August 02, 2021.