Most people think of credit cards as expensive and risky. Yes, this was true in the past but not anymore as credit card is very easy to use and come with numerous benefits. Here are the top 15 advantages of credit cards:
1) Universal acceptance:
Visa, MasterCard, and American Express cards are accepted at every store that accepts debit or credit cards. Even if a particular store does not accept credit cards, you can buy gift cards from them and use them for making payments at various stores. You can also pay online using your credit card without any obstacles.
2) Easy to get:
Most people say they do not need a credit card because they already have debit cards that serve their purpose well. A credit card is based on credit while the debit card is linked to your checking account. When you make a purchase with a debit card, the money comes out from your checking account immediately whereas it takes around 2-3 days for the bank to transfer the balance amount if any exists in your savings or current account when you use a credit card.
Most importantly, every time you swipe your debit card information about that transaction gets stored in the merchant's computer but it won't happen in the case of credit cards because each transaction has a unique number that records transaction details without disclosing the personal information of the consumer. This way merchants can easily get hold of all records even if one of their employees turns rogue for stealing customers' information.
3) Safety:
One of the major reasons credit card is safe to use is because it uses special technology called CVV (Card Verification Value). This helps in confirming the validity of credit cards without storing or recording any personal details on the merchant's system.
So, even if you lost your credit card, no one can make fraudulent transactions on your account as they do not have your number and additional information required to verify ownership of your credit card.
4) Cash out with a bank ATM:
If you are traveling abroad then you must know how difficult it becomes for a person who does not own foreign currency. You always need to find a money exchanger every time when you travel but now there is an easy way which removes this trouble called an ATM card. With an ATM card, you can withdraw foreign currency from any bank ATM and this money will be added to your credit card bill after two or three days. You do not need to pay anything at that time as you just need to pay money at the end of the billing cycle.
5) Protection against theft:
If anyone steals your credit card, he/she cannot use it for making payment because there is an expiry date given on credit cards. Also, if someone tries to make fraudulent transactions then banks are quick enough to detect fraudulence and block accounts within minutes of the transaction so that no other person can utilize stolen credentials.
6) Reward points:
Credit cards provide reward points every time you make a purchase using them which ultimately helps in earning free flight tickets, reward points for shopping, and cashback on purchases.
7) Insurance:
The credit card provides insurance cover of $100 for stolen or lost credit cards so that no consumer needs to worry as banks are there to protect them from fraudulent activities.
8) Cash advance:
If you do not have cash in hand at the time of emergency but your credit limit is enough then you can easily get cash through a credit card by making payment at any bank ATM with ease. We all know that during emergencies we always need some money and if we wait until salary day then it will be difficult for us to handle things properly.
9) Access to exclusive privileges:
Some credit cards provide access to exclusive privileges such as free access to the lounge which you can get for free with a credit card.
10) Preserve your score:
If a person uses a debit card every day then his/her bank account will be in red because the money comes out from their checking account every time they make a payment but it is not the case with credit cards as available credit line increases along with transactions and decreases when cash is paid to merchant or bank.
This way, credit score gets higher slowly and gradually over time which helps consumers in getting loans easily if required.
11) Multiple benefits:
You must have noticed that most debit cards nowadays provide reward points like credit cards so if you are looking for the extra benefit then always choose credit cards because they provide you multiple benefits at one time.
12) Instant credit:
One of the major benefits of credit cards is instant credit which means you can borrow money instantly whenever you need it without waiting for salary day or any bonus payment. Just make sure to repay the money within 30 days so that your loan does not turn into debt because debt cannot be paid easily especially on one income source.
13) Improved spending capacity:
If a person uses debit cards only then his/her spending power is limited but on the contrary, if someone uses credit cards then he/she has no limit upon how much they spend every month as long as they are capable enough to pay their bills at end of the billing cycle.
14) Avoid late payment fees:
banks charge around $25-$35 for late payment fees and this amount is very significant when you pay after 30 days of the due date. You can avoid paying such high costs by making timely payments on a credit card and this charge does not apply if payment is done within 30 days’ time frame.
15) Free credit score:
Credit cards provide free yearly credit scores so that consumer can understand their credit health which will help them in getting loans at lower interest rates or providing better terms to existing loan providers.
Conclusion:
Credit cards provide numerous benefits to users which is a great benefit as compared to debit cards. If anyone wishes to avoid late payment fees, then always choose a credit card over any other transaction-related product or service. Credit cards define as a small plastic card that has a magnetic strip on the back of them which gets transmitted every time a user swipe this credit card at the merchant location.
The most famous credit card company in India is American Express as it has the largest market share according to the latest reports and statistics provided by the Reserve Bank of India (RBI). People use credit cards for various purposes like online shopping, buying items, booking hotels rooms, flights tickets for family vacations, etc. because these days most of the big businesses accept payments through credit or debit cards without charging any extra cost which gives consumers ease of spending money in much efficient way.
Most people are still not aware of credit cards because they think that credit card is only for rich people but this is the wrong statement because it can be used by anyone according to their financial capacity to repay the required amount.
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