Demystifying Add-on Credit Cards: Everything You Need to Know

Credit cards have gained popularity not only as a means to get additional purchasing power but also to save on regular spend in the form of rewards, cashback or discount. Other complimentary services such as lounge access, hotel memberships, fuel surcharge waiver, etc. add to their benefits. However, every credit card comes with its own eligibility criteria that you need to satisfy to be able to get it. In such cases, add-on credit cards come as a good option for those who are not eligible for a credit card of their own. An add-on card user can enjoy all the benefits offered on the primary credit card. Here is all you need to know about add-on credit cards and their benefits.

What are Add-on Credit Cards?

Issued against the primary credit card, add-on credit cards can also be called secondary or supplementary cards that are issued to the immediate family members, like spouse, children, or parents. These cards come with similar benefits as offered on the primary card in terms of the rewards program, discounts and other forms of value-back. However, certain feature on add-on cards may be different from primary cards. For example, complimentary lounge access on credit cards may not be extended to add-on users and only applicable to the primary member.

The only difference between a primary and an add-on card is that only the primary cardholder has to manage the credit account bill payments and it is only the primary account holder whose credit profile is affected. So, if you want to build your credit score, getting an add-on card would not be the right approach as it only affects the primary cardholder’s credit.

How to Apply for an Add-on Credit Card?

In most cases, primary cardholders can request for add-on cards either via netbanking or by contacting the card issuer’s customer service. While submitting the request, the primary cardholder will need to provide the necessary information and may be required to authorise the individuals who will be using the add-on cards. These secondary cards may or may not incur additional issuance charges or annual fee, depending upon your card type.

How do Add-on Cards Work?

Once the request for add-on cards is accepted and the cards are issued, the add-on cardholders can use their card to avail the features and benefits thus offered and share the credit limit with the primary users. However, the primary cardholder would still be responsible for the credit card account. 

This means the primary users will have to track the card usage and repay all the dues on time on their own, which also include the transactions made via the add-on cards. They would also have complete control over the account and can set spending limits on add-on cards and even cancel the supplementary card, if needed.

Benefits of Getting Add-on Credit Cards

When used wisely, add-on credit cards can prove to be very beneficial for both primary as well as secondary cardholders. Given below are some of the key benefits:

  • Assist in Understanding on How Credit Works

Using add-on credit cards helps new users in getting an understanding on how credit cards function and develop a responsible credit behaviour. The add-on credit card users can use this experience to get an official introduction to credit cards and learn how to manage their own credit cards responsibly in the future.

  • Help Maximise Rewards

Add-on credit cards help the primary user in utilising the card features to their full potential and scale up the rewards earning on the card spends, thus increasing the total value-back. Benefits like spend-based milestone bonuses are also easier to unlock without overspending as, instead of a single primary cardholder, multiple users make their spends using the same account.

  • Give Complete Control to Primary Card User

Even though the add-on card members can use their add-on cards and enjoy its benefits, the final control still lies in the hands of the primary cardholder. Only a primary cardholder can get an add-on card issued upon request and set the terms of card usage. Add-on card issuance, cancellation and spending or cash withdrawal limits, are all under the control of the primary credit account holder who can also monitor the monthly spends made by all the cards linked to their account. This helps in better account management and reduces the chances of misuse, as only one person is responsible for the account maintenance.

Things to Consider

Despite their benefits, there are certain things that you must keep in mind regarding the add-on credit cards, which mainly include their effect on the cardholders’ credit profiles. 

As an add-on member, you may get to avail the card benefits and gain experience on how credit cards work. However, add-on cards do not help you build your credit profile. All the add-on cards are linked to the same account holder and their usage is directly reflected on the primary user’s credit profile. So, while the add-on cards help maximise the card rewards and benefits, they are not the right choice for add-on card users if they wish to build their credit profile.

Moreover, if managed judiciously, add-on cards can help boost the savings as well as the credit score of the primary cardholder. But if used recklessly, there would be equivalent negative effect on the primary user’s credit score. Hence, even though having complete control over the add-on cards helps the primary user in better account management, it is also accompanied with the risk of impacting their credit score negatively if the add-on member does not use the card mindfully.

So, the credit cardholders must make sure that they only allow trusted family members to use add-on cards linked to their credit account to ensure that there is no misuse of add-on cards and to minimise the risk of getting debt-trapped due to reckless credit card usage.

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