Should you be Considering to buy a Pre-Approved Credit Card?

You might have received many emails in your inbox saying “you are eligible for a pre-approved credit card”. These offers might seem convincing at first sight. You might be excited to get a credit card. Does that mean you will surely get a card? Not always! Here are some of the facts of pre-approved credit cards.

What is a Pre-Approved Credit Card?

A pre-approved credit card, also known as a pre-qualify credit card, is basically a type of credit card option that the banks provide. According to the mails, such cards will be provided to you immediately without any further verification. So, first things first, always read the terms & conditions before you react to such mails.

Every credit card company has a database of credit scores by Credit Bureaus of people who are eligible for a credit card. This database is used as a reference for potential credit card buyers. The creditors then send an automated mail to the listed people stating an opportunity to get a credit card that is pre-approved.

You are tricked into believing that the cards are actually pre-approved and there are no strings attached. But there is a catch, once you agree to apply and get yourself into the gimmick, the credit card company will conduct a second round of background check of your Credit Score. In case they find that the score is not satisfactory your application will get rejected, which will hamper your credit score. This is the major drawback of applying for a pre-approved credit card.

Benefits of Pre-approved Credit Cards?

Following are some benefits of Pre-approved Credit Cards-

• Sometimes credit card companies might provide you with cards with special benefits and APRs (Annual Percentage Rate) as introductory offers.

• Pre-approved credit cards usually claim to have better rewards and sign-up bonuses.

Companies that offer pre-approved credit card

Here is a list of companies that offer pre-approved credit card in India-

• Pre-approved HDFC Credit Card
• Pre-approved Axis Credit Card
• Pre-approved Credit Card
• Pre-approved Standard Chartered Credit Card
• Pre Approved RBL Bank Credit Card
• Pre Approved CapitalOne Credit Card
• Pre-Approved American Express Credit Card

Conclusion

The concept of pre-approved credit cards may sound interesting to hear, but they come with their major set of downsides. Pre-approved credit is nothing more than a marketing gimmick that companies use to drive in more customers. In order to apply for this credit card, you should first consider the outcome of it and whether it is worth the risk.