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The basic costs you have to pay to own a credit card are the joining fee and the annual fee. These fees may be waived depending upon the credit card company and the offers that they might have at a given time. Also, these fees vary with the type of card you choose. A silver card may have low or even no annual fee whereas a titanium card may have a very high annual fee.

A reward point is the concept introduced by card companies to lure cardholders into frequent usage of cards. On every 100 rupees worth purchase made through the card, a cardholder would earn some reward points depending upon the type of card he/she owns. These points could be redeemed for gifts, select product purchases and even for paying the annual fees. So, every point would be equivalent to say one rupee.

Minimum salary criterion varies with the card type. It is always the highest for a titanium card and the lowest for a silver card. But one could say that you need a salary of at least Rs 70,000 per annum to get an ordinary card and Rs 1,20,000 plus per annum for a gold card. Also, different credit card-issuing institutions have different minimum salary criteria.

First, contact a credit card company or card-issuing bank like HDFC, Citibank and ask for a credit card application form. Submit the duly filled in form along with the required documents. You can get the list of documents from any sales representative of card-issuing banks. If the bank is satisfied with your credit worthiness, it will issue you a credit card with a preset credit limit.

* First and foremost, you can go shopping or dine at an expensive restaurant, without worrying about how much cash you are carrying in your wallet. Credit cards save you the hassle and reduce the risk of carrying hard cash around.
* During emergency when you might be in need of urgent cash you can use your credit card to get money from ATMs.
* You will be benefitted from reward programmes like cashback on shopping, fuel purchase, ticket reservations, etc., and can also get memberships to various prestigious clubs depending upon your card type.
* Credit cards are extremely convenient when you are on a trip and don’t have access to hard cash.
* For most online purchases you need credit cards.
* You can buy things using credit cards and pay for them at a later date. And, if you pay your bills on time you are not charged any interest on your spending through your card.

Titanium, platinum and gold are the premium credit cards. Basically, these are the terms used by card-issuing banks to differentiate between the levels of services offered on each card. In premium segment, titanium cards give higher reward points, more privileges and discounts. But at the same time, these cards attract the highest fees and service charges.
On the other hand, there are standard credit cards on the lowest segment. These cards have got very low or no annual fees, and do not offer as many discounts as a titanium card would. Basically, these are no-frills, low-cost cards offering benefits of a credit card. This is how you can classify the credit cards from the most expensive to least expensive.

* Titanium cards: Most expensive in terms of fees, and also give access to most privileges
* Platinum cards
* Gold cards
* Silver cards
* Standard cards: Least expensive in terms of fees, and also low-cost, no-frills cards

A credit limit is the maximum amount of money allowed for use by an issuer on a credit card. This limit is determined by the card issuer on the basis of your income, source of income, etc.

As of now there are three types of credit cards, namely, Visa, MasterCard and Amex that are available in India. Both Visa card and MasterCard are the most popular forms of credit card in the country while Amex is a new entrant. Amex cards are issued only through American Express Bank.

Financial institutions issue credit cards to their customers for the purchase of various goods and services up to a certain amount through a credit card account. When you use a credit card, you are using part of your credit limit which is predetermined by these institutions at the time of issuing the card. Interest is charged by these institutions on a percentage of your outstanding balance at the end of a billing cycle. But you can be saved from paying interest, if you pay back the whole balance in time.