Can You Gift A Credit Card? Yes, And Here's How to Do It

Most banks allow cardholders to add family members, such as spouses, children (above 18), or parents, to their credit card account

Prepaid cards are another gifting option that allow the flexibility of a credit card without you being responsible for the payment.

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Festive gifting can be tricky business. With countless options available, finding the perfect gift for family and friends is something many of us have struggled with. One unique gifting option is a credit card which can help your loved ones save money while helping you build your credit score. Now, you can’t just hand your credit card to someone else but you can gift them an add-on credit card which offers all the perks. Let’s find out how you can go about this.   

What is an add-on card?

Most banks allow cardholders to add family members, such as spouses, children (above 18), or parents, to their credit card account. These are known as add-on cardholders who receive a separate card that is tied to the primary cardholder’s account. Here are some features of add-on cards that are important:

• The primary cardholder will be responsible for all transactions made by the add-on cardholder.
• The credit limit is shared between the primary and add-on card. This means, the add-on cardholder's purchases will count against the overall credit limit of the primary card.
• Add-on cards usually have the same benefits as the primary card, such as rewards points, cashback, and insurance coverage.

How to Apply for an Add-On Credit Card

1. Check eligibility: Banks usually restrict the issuance of add-on cards to immediate family members. So, find out the eligibility criteria for add-on cardholders to ensure that the person you want to gift the card to qualifies this criteria.
2. Submit an application: Once you have confirmed that the person qualifies for an add-on card, apply for it. Banks usually allow customers to do so via their mobile app, online banking, or by visiting a branch. Carry necessary documents like the add-on cardholder's ID proof, address proof, and a photograph. Banks may sometimes also offer pre-approved add-on cards depending on the primary cardholder’s eligibility and credit scores, making the process easier.
3. Receive the add-on card: Once your request has been approved, the bank will issue the add-on credit card in the name of the person you’ve added. This card can be used independently but the bill for it will reflect in the primary cardholder’s account.

Prepaid Cards

Prepaid cards are another gifting option that allow the flexibility of a credit card without you being responsible for the payment. These cards come with a pre-loaded balance and no credit, which makes them an ideal gifting option. Moreover, since this card comes with a pre-loaded balance, it does not attract any interest charges or penalty. As result here is no danger of overspending involved. Prepaid cards are widely accepted at most stores and online platforms. 

How to Gift a Prepaid Card?

To gift a prepaid card, simply purchase one from a bank or a financial institution. The amount you load onto the card becomes its spending limit, which the recipient can use until the balance is exhausted. Prepaid cards provide flexibility, security, and the ease of cashless transactions.

Add-on cards are a good way to provide financial independence and instil responsible financial management. However, do remember that while adding someone as an add-on cardholder gives them the ability to use a credit card, the financial responsibility to repay those charges will lie with you, the primary cardholder. If you aren’t comfortable with that, you can opt for prepaid cards which are a risk-free way of gifting someone with funds without the dangers of debt or credit risks.

The author is the CEO of BankBazaar.com. This article has been published as part of a special arrangement with BankBazaar.