A co-branded credit card is a type of credit card issued by a financial institution (usually a bank) in partnership with a retail brand, airline, e-commerce company, or service provider.
New Delhi: Credit cards have been extremely popular off late. Buy now, pay later – abbreviated as BNPL – gave a push to the adoption rate. Despite the surge in UPI usage, they are still one of the most preferred ways of spending, especially for big-ticket purchases, with education, healthcare, and auto ancillary sectors seeing strong growth in digital credit adoption. But do you know that using a co-branded credit card can maximise your return on spending? Let’s understand everything about such credit cards in detail.
What is a Co-branded Credit Card?
A co-branded credit card is a type of credit card issued by a financial institution (usually a bank) in partnership with a retail brand, airline, e-commerce company, or service provider. These cards carry the branding of both the bank and the partner brand. According to Bhargav Errangi, founder of POP, they are tailored to reward spending with that specific brand through loyalty points, cashback, or exclusive perks.
“For instance, the YES Bank POP-CLUB Credit Card is co-branded between POPclub and YES Bank. It offers enhanced benefits when used on the POPclub app and ecosystem, such as increased reward rates and exclusive redemption options,” he added.
Difference Between Co-branded, Regular, and Store Cards
Feature
Co-branded Credit Card
Regular Credit Card
Store Card
Branding
Issued by a bank in partnership with a brand
Issued solely by a bank
Issued by a retail store or brand
Usage
Can be used anywhere (Visa, Mastercard, RuPay, etc.)
Can be used anywhere
Often limited to the issuing store
Rewards
Higher rewards on partner brand spends
General rewards on all spends
Rewards usable only in-store
Acceptance
Universally accepted
Universally accepted
Restricted to one brand/store
Key Benefits of Co-branded Credit Cards
High Rewards with Partner Brand: These cards often offer higher cashback, reward points, or miles when used with the partner brand. For example, a travel co-branded card may offer accelerated miles on flight bookings with the airline partner.
Exclusive Offers & Discounts: Cardholders get early access to sales, extra discounts, or special privileges such as complimentary tickets, free upgrades, or buy-one-get-one offers from the brand.
Redemption Flexibility within Brand Ecosystem: Rewards earned are typically redeemable for purchases, vouchers, or services offered by the partner brand. Some cards may also allow conversion into brand loyalty points.
Welcome Benefits: Most co-branded cards come with joining bonuses such as vouchers, reward points, or discount coupons—worth thousands of rupees—on first spend or activation.
Additional Perks: Depending on the card, you might get airport lounge access, dining discounts, EMI conversion, fuel surcharge waivers, and more.
Joining Fees & Charges
Co-branded credit cards may or may not have a joining or annual fee. “Some are lifetime free, especially when targeting a mass-market audience, while others may charge Rs 500 to Rs 1,000, often waived on reaching a spending milestone,” Errangi said.
Always check for:
Annual fee & waiver conditions
Interest rate (APR)
Late payment charges
Foreign transaction fee (if applicable)
Eligibility Criteria
Eligibility for co-branded credit cards typically includes:
Age: 21 to 60 years (salaried) or up to 65 (self-employed)
Income: Minimum monthly income (usually Rs 15,000 to Rs 30,000 depending on card tier)
Credit Score: Good credit history (CIBIL 700+ preferred)
Residency: Must be a resident Indian with valid ID and address proof
Some fintech or app-based cards may offer relaxed eligibility, especially for first-time credit card users or young professionals.
Is a Co-branded Credit Card Right for You?
A co-branded card is ideal if you frequently shop or transact with the partner brand. It maximises your return on spending by aligning your lifestyle with reward potential. However, if your purchases are more varied or you prefer flexibility in reward redemption, a regular credit card might be more suitable.
Store cards, on the other hand, are only beneficial if you’re loyal to a particular store and don’t mind the limited usability. Their rewards are often not as generous or versatile as co-branded or regular credit cards.
