There is great emphasis on making digital payments across India. It is also not practical to have a huge wad of currency notes in your pocket every time you go shopping. Credit Cards provide the perfect alternative. It is the easiest way to make payments for your purchases. In addition to the convenience, banks offer reward points on using their Credit Cards. You can redeem these reward points subsequently and buy products of your choice.
Credit Cards work on the 'Buy now and Pay later' principle. It is a straightforward process. Every Credit Card comes with a prescribed limit. If the threshold is available at the time of your purchase, the bank approves the payment. The bank raises the bill on the fixed date. You have to make the payment on or before the due date mentioned in the statement.
What are the Benefits of Using a Credit Card?
- Credit Cards are the perfect alternative to cash. There is no need of carrying large amounts of money when you have a Credit Card.
- You get an interest-free window depending on the date of billing and the due date. The maximum interest-free period is between 52 and 55 days.
- Credit cardholders can avail cash advance facility on an urgent basis. Every Credit Card comes with a cash advance limit. Note that this is not an interest-free advance. You have to pay interest on the cash advance portion from day 1.
- Banks allow credit cardholders to apply for add-on cards for their family members. They can use these cards on an individual basis.
- Banks issue unique Credit Cards that allow the cardholders to avail travel benefits like air miles, airport lounge access, airline offers, hotel offers, and travel insurance. These cards are also known as Co-branded Credit Cards.
- Some Credit Cards come with lifestyle benefits like dining, shopping, entertainment, and wellness and so forth.
- Many banks offer fuel surcharge waivers to their credit cardholders.
- Proper usage of the Credit Card can improve your credit history.
- Today, you have international Credit Cards that allow you to make payments in foreign currency. You can also withdraw cash in foreign currency when you travel abroad
- There are Credit Cards that come with general insurance coverage. Some cards come with lost card liability or insurance to protect the cardholders from missing cards and forged transactions.