Recently, several banks announced to offer credit cards for new customer and existing customers on the opening of fixed deposits. The card will be known as fixed deposit cards (FD cards) and will be linked with fixed deposits.

Recently, ICICI which is the largest bank of India has announced to offer credit cards if a customer open fixed deposit. It is for that customer who doesn’t meet the conditions of Bank criteria. The card which will be offered by ICICI FDs account will be known as Fixed Deposit Instant Credit Card.

In this row Axis bank is also announcing the same features and scheme. There are many other banks also who are ready to launch the scheme but now they don’t want to comment on the scheme.

From HSBC, Ravi Subramanian who is the head of cards said in news, “this product not only secures the lending, but also allows banks to issue a credit card to a person who is otherwise not eligible.”

About the scheme banks are announced to open fixed deposit accounts from Rs 20,000 of minimum amount and Rs 3 lakh of maximum amount. The card limit will be 85% of the FD amount.

In this condition the FD holders can’t withdraw their amount to remain cards active. But they are able to withdraw their interests.

The T&C is very high with the card. If a customer is not able to pay his outstanding amount within 90 days then bank has the right to transfer amount from the FD.

From the foreign bank credit cards head said in news, “Many banks are toying with this idea with a view to expanding their credit card base. But it makes sense only for low-end customers.”

We can’t say how effective it will be in the future but it has own importance because it is the business plan by banks to make a longer time and loyal customer for their services.