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Add-on credit cards are supplementary cards linked to a primary account, allowing trusted family members or individuals to make purchases under the primary cardholder's credit limit. The primary cardholder remains responsible for the payments, while the usage of the add-on card helps both users build their credit history. These cards are a practical solution for families, students, or individuals who need access to credit but aren't yet eligible for their own. With add-on credit cards, you can manage spending while helping others establish financial independence.
An add-on credit card is linked to the primary cardholder’s account, allowing other users to make purchases using the same credit limit. The primary cardholder remains responsible for paying the bill, while the add-on cardholder can make purchases within the available limit. Importantly, the add-on cardholder doesn’t have a separate credit limit; they share the same limit as the primary cardholder.
For example, if the primary cardholder has a ₹50,000 credit limit, both the primary cardholder and the add-on cardholder can use this total limit. Once the limit is reached, the primary cardholder must pay the outstanding balance. In some cases, add-on cards may come with a lower spending limit to help manage the add-on cardholder's spending.
By linking the add-on card to the primary account, the primary cardholder can maintain control while offering family members or trusted individuals access to credit.
If you're considering an add-on credit card, understanding its advantages can help you manage your family's spending wisely. Here are the key benefits to consider:
Convenience: Family members can shop easily without needing their own credit card.
Shared Limit: Users access the primary cardholder’s credit limit without applying for their own credit.
Credit Building: Timely payments improve credit scores for both the primary cardholder and the add-on user.
Family-Friendly: Ideal for children, spouses, or elderly parents who require access to credit without separate accounts.
Controlled Spending: The primary cardholder can set spending limits to prevent overspending by add-on card users.
Being aware of the potential drawbacks of add-on credit cards helps you make an informed decision and protect your financial health:
Primary Holder Responsibility: The primary cardholder must pay all charges, even if the add-on cardholder overspends.
Risk of Misuse: The primary cardholder cannot control every purchase, increasing the risk of irresponsible spending by add-on users.
Credit Score Impact: Any missed or delayed payments can negatively affect both the primary cardholder’s and the add-on user's credit scores.
Shared Credit Limit: High spending by an add-on user can quickly use up the primary cardholder’s available credit, restricting future purchases.
Applying for an add-on credit card is relatively straightforward. The process typically involves the following steps:
Check if your primary credit card account is active and in good standing
Verify the eligibility criteria for add-on cardholders with your bank
Visit the bank’s website or branch to access the add-on card application form
Fill in the application form carefully with accurate personal details
Attach essential documents such as ID, address proof, and relationship proof with the primary cardholder
Submit the completed application form online or at the nearest bank branch
Wait for the bank to verify and approve your application
Receive your add-on credit card, usually delivered within 1–2 weeks after approval
Here is how to determine if an add-on credit card matches your family's financial situation:
Families with Students
Parents can help students handle everyday expenses while teaching them responsible spending and credit habits.
Young Adults
Young adults without their own credit can safely access funds and begin building a positive credit history with an add-on card.
Elderly Family Members
Senior family members who may find managing finances challenging can comfortably make purchases while the primary cardholder monitors spending.
Spouses or Partners
Couples can conveniently share expenses and manage finances together, maintaining clarity over spending habits with a single, shared credit limit.
Dependents or Caregivers
Dependents or caregivers who require regular financial support can receive controlled access to funds without the risk of overspending.
Here is why understanding how add-on credit cards affect your credit score matters for maintaining healthy financial habits:
Shared Credit Score Impact: Late payments on the add-on card affect both the primary cardholder’s and add-on user's credit ratings.
Credit Utilisation: High spending by an add-on cardholder can lead to increased credit utilisation, negatively affecting both users’ credit scores.
Timely Payments: Making payments on time boosts the credit scores of both the primary cardholder and the add-on user.
Credit History Building: Responsible use of an add-on card helps the add-on user establish a positive credit history, benefiting their financial future.
Financial Risk: Missed or irregular payments due to the add-on cardholder's spending habits can damage the primary cardholder’s financial reputation.
Deciding whether an add-on credit card suits you depends on your financial situation and family dynamics. If you trust your family members or dependents to spend responsibly, an add-on card is a helpful tool. It simplifies expenses and allows users to build their credit history safely.
However, if there’s a risk of overspending or financial disagreements, alternatives like prepaid cards or secured credit cards may be better. Choose an add-on credit card only if you can comfortably manage the shared responsibility without risking your financial health.
Here are reliable alternatives to add-on credit cards if you prefer separate financial responsibility:
Individual Credit Cards
Apply for a personal credit card to maintain independent control over spending and build your credit score separately.
Secured Credit Cards
Secure a credit card by depositing funds upfront, helping individuals with limited credit history safely manage spending and build credit.
Prepaid Cards
Use prepaid cards to provide family members or dependents with controlled spending limits without affecting your personal credit rating.
Debit Cards
Issue a debit card linked directly to a bank account to track spending easily, avoiding debt or credit risks associated with credit cards.
Digital Payment Apps
Manage family expenses with payment apps or digital wallets, offering convenience without involving credit checks or affecting your credit score.
An add-on credit card is a supplementary card linked directly to the primary cardholder’s account, allowing family members to share the existing credit limit. It helps manage family expenses while building credit history for the add-on user.
Adding someone to your credit card helps them build a strong credit history through shared spending and responsible usage. It also simplifies family finances by offering controlled access to credit under one account.
Many banks issue add-on credit cards without fees as a benefit to primary cardholders, especially with premium cards. However, some financial institutions may charge issuance or annual fees depending on card type.
Yes, you can add family members or trusted individuals to your credit card, typically through your bank’s online portal or branch. Once added, they share your existing credit limit and spending privileges.
Responsible use of an add-on credit card, including timely payments and low credit utilisation, positively impacts both users’ CIBIL scores. However, misuse or missed payments can negatively affect the scores of both parties.
An add-on credit card does not increase your credit limit, as it shares the primary cardholder's existing credit limit. Both users draw from the same limit, potentially affecting credit availability.
Banks typically set a maximum number of add-on cards per primary credit card account, often ranging from two to five supplementary cards. Each card shares the primary account’s total credit limit.
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Posted on 16 May
Roshani Ballal
Academy by Bajaj Markets
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