Why Gen Z is Going All-In on Zero-Fee Credit Cards

India has a competitive credit card market. You can find a good number of credit cards online that cater to the cost-conscious Gen-Z consumer by eliminating annual fees. A credit card annual fee is the charge issuers impose on their borrowers to keep their cards active. The charge can go up to 3%  of the outstanding amount.  

However, if you choose correctly, you can get away with the fees and enjoy the same perks. These cards offer a financially savvy alternative for those seeking to avoid annual fees.

Understanding Credit Card Annual Fees 

Credit card issuers usually charge an annual fee for offering their services. This fee can range from a small, affordable amount to a few thousand rupees, depending on the card’s features and benefits. 

However, there are two simple ways to avoid paying an annual fee:

• Opt for a card that waives the annual fee if you meet its minimum yearly spending criteria, as specified by the issuer

• Choose a zero-fee or lifetime-free credit card that doesn’t charge any annual fee at all
  
  

What Is a Lifetime-Free Credit Card?

A credit card that does not charge any annual fee or renewal fee for the entire duration you hold the card is known as a lifetime-free credit card. This card is ideal for:

• First-time credit card users

• Budget-conscious customers

• People who want to build credit without worrying about yearly fees

Lifetime-free doesn't always mean completely free. While these cards may have no annual or renewal fees, other charges can still apply—such as late payment fees, interest on unpaid balances, or foreign transaction fees. 

Additionally, some cards are only conditionally free, meaning the annual fee is waived if you meet a specific spending threshold. This threshold varies from card to card. These credit cards function like regular credit cards and typically offer the following features:

• No Annual or Renewal Fees: You don’t have to pay a yearly fee to keep the card active 

• Standard benefits: They usually include features such as online and in-store purchases, bill payments, EMI conversion, and sometimes rewards or cashback 

• Eligibility Requirements: Issuers assess your credit score, income, and existing banking relationship before approval

• Time-limited Deals: Some cards are offered as lifetime-free during limited-time promotions or when specific conditions are met at the time of application

Why Indian Youth Prefer Zero Annual Fee Credit Cards

Gen Z prefers financial flexibility and convenience without the added costs. As more young people embark on their financial journeys, they seek options that are simple, low-risk, and rewarding without the burden of fees.

Here’s why zero annual fee credit cards online appeal to Indian youth:

• Cost-Effective Entry Point

Young earners or students may not want to commit to recurring charges. A no-annual-fee card provides access to credit without the worry of paying a yearly fee, making it ideal for first-time users. Many also prefer instant virtual credit cards, which are often available with zero-fee options

Young earners or students may not want to commit to recurring charges. A no-annual-fee card provides access to credit without the worry of paying a yearly fee, making it ideal for first-time users. Many also prefer instant virtual credit cards, which are often available with zero-fee options.

• Focus on Budgeting

With limited or fixed monthly incomes, many young people prefer cards that don’t eat into their savings. Avoiding annual fees helps them focus on essential spending and build responsible credit habits.

• No Pressure to Spend More

Annual fee cards sometimes require users to meet a minimum spend threshold to waive the yearly fee. Zero-fee cards eliminate this pressure, making them perfect for those who don’t make high monthly purchases.

• Great for Building Credit

Many young individuals use no-annual-fee cards to start building their credit history. By maintaining low credit utilisation and paying bills on time, they can develop a strong credit score—without paying anything extra.

Top Zero-Annual-Fee Credit Cards

Zero-annual-fee credit cards offer a smart way to access credit without paying yearly fees. 

Here are some of the top credit cards that come with no annual fee.

With so many zero-fee credit cards online in India, it's now simpler than ever to get a card that suits your spending habits and financial goals. It's important to compare the features, benefits, and rewards of different cards before choosing the one that best suits your needs. 

Equally important is reading the terms and conditions carefully to understand any hidden fees or charges that may apply under specific circumstances. Selecting a credit card with transparent policies, especially one with zero annual and joining fees, can help you avoid unnecessary expenses. 

One great option to consider is the One Credit Card, as it comes with zero joining and annual fees, offering true lifetime-free benefits. Enjoy 5X reward points on your top two spending categories every month. Plus, your reward points never expire, so you can redeem them using the OneCard App whenever you like to maximize your savings. 

Additionally, take advantage of the app to pay your bills, online subscriptions, and rent with ease. Apply online now and start experiencing the benefits of this instant virtual credit card right away!