Buying a car is one of the biggest financial decisions most of us make. Whether it’s your first hatchback, a family SUV, or even a luxury ride, the cost is significant. But here’s the thing many people don’t realize – if you use your credit card smartly during the purchase, you can actually earn lakhs worth of rewards, cashback, or benefits.
At prkshadvisors, we always tell our customers – “Why let free rewards slip away when you’re already spending big money?”
Let’s break this down step by step in a simple way, so you can actually maximize your credit card rewards while buying a car in India.
1. Can You Really Pay for a Car with a Credit Card?
In India, most car dealers allow partial payment via credit card, but rarely the full amount. Usually, you can swipe ₹1 lakh to ₹5 lakh depending on the dealership’s policy. For luxury cars, some premium dealers may even allow higher swipes.
👉 Example: If your new Hyundai Creta costs ₹15 lakh, the dealer might let you pay ₹3 lakh via credit card and the rest by cheque, loan, or NEFT. That ₹3 lakh swipe can fetch you big rewards if done smartly.
2. Why Paying Through Credit Card Makes Sense
Now, you might be thinking – “Arre yaar, dealer will charge me 1-2% extra for credit card swipe. Is it worth it?”
Here’s the simple math:
- Suppose you pay ₹3 lakh on credit card
- Dealer charges 2% fee = ₹6,000 extra
- But if your credit card gives you 5X rewards, cashback, or air miles, you could get benefits worth ₹10,000 – ₹15,000 easily.
So yes, in most cases, it’s worth it! Especially if you’re using premium cards like HDFC Infinia, SBI Elite, or ICICI Sapphiro.
3. Pick the Right Credit Card for Car Purchase
Not all credit cards are equal. Some give better rewards on travel, some on shopping, and some on high-value spends. For a car purchase, choose:
- Premium Travel Cards – like HDFC Infinia or Axis Magnus (great for air miles & luxury travel perks).
- Cashback Cards – like SBI Cashback or Axis Ace (straightforward money-back into your account).
- Lifestyle Cards – like ICICI Sapphiro or HDFC Regalia (good for vouchers, dining, or fuel).
👉 Pro tip from prkshadvisors: Always call your bank before making a big payment. Sometimes, they run special offers on big-ticket purchases – like “10X rewards this month on spends above ₹2 lakh.”
4. Split Payments Smartly
If you and your spouse or family member have different credit cards, you can split the payment across cards to double the benefits.
Example:
- You pay ₹1.5 lakh via HDFC Infinia (earning 5,000 reward points worth ~₹5,000).
- Your wife pays ₹1.5 lakh via SBI Cashback card (earning 5% cashback = ₹7,500).
Together, you’ve earned ₹12,500 worth of benefits, just by using two cards smartly.
5. Convert to EMI Without Interest Shock
Car loans are common in India, but what if you could convert your credit card swipe into no-cost EMI?
Many banks like HDFC, ICICI, and Axis offer EMI conversion on spends above ₹10,000. So if you swipe ₹3 lakh, you could split it into 12 months EMI with low or zero interest.
👉 This works best if you’re confident about repaying on time. Otherwise, interest charges can eat into your rewards.
6. Combine Rewards with Bank & Dealer Offers
Here’s a desi jugad: don’t just depend on your credit card rewards, also check for bank tie-ups with dealers.
- During festivals like Diwali, Dussehra, or Holi, many banks offer cashback of ₹10,000 – ₹20,000 on credit card swipes for car purchases.
- Dealers also run schemes like “Book your car with XYZ Bank credit card and get free insurance.”
So always ask your dealership – “Bhaiya, koi credit card offer chal raha hai kya?” You’ll be surprised how much you can save.
7. Redeem Rewards Smartly
Earning rewards is one thing, but using them smartly is another.
- If you’ve earned air miles, plan your next holiday trip with them.
- If you’ve got cashback, it directly reduces your car ownership cost.
- If you’ve got vouchers, use them for fuel, accessories, or even service.
At prkshadvisors, we always recommend – don’t let reward points expire. Keep track of them through your bank app or statements.
8. Things to Keep in Mind
Before you get too excited, remember:
- Don’t overspend – just because you’re getting rewards doesn’t mean you stretch your budget.
- Clear dues on time – credit card interest can be 36-40% annually, much higher than car loans.
- Negotiate swipe charges – some dealers may reduce the 2% charge if you insist or if the payment is high.
Final Thoughts
Buying a car is always special – whether it’s your first Alto, your dream Fortuner, or a family EV. Using your credit card smartly during this purchase can give you an extra edge with rewards, cashback, or miles worth thousands of rupees.
So next time you head to a showroom, don’t just focus on the car’s features – also think, “Which credit card should I swipe to get maximum benefits?”
At prkshadvisors, we believe in helping people make smarter financial decisions. After all, why leave money on the table when a simple credit card strategy can make your car purchase even sweeter?