Students may find it thrillinMay 05, 2023
Benefits of Having a Credit Card| How to Use It Wisely?
Most people in India are not well-aware of the large-scale benefits of a credit card holder, which is why everyone has an account but quite a less number of them own a credit card. Having a credit card may assist you in several ways; it can improve your CIBIL score and your account activity as well.
Today, we will tell you why exactly you must own a credit card and how you can use one effectively for your benefit:
Obtaining emergency help when necessary
Your credit card might be a helpful resource in an emergency to get help when it's most required. Imagine, for instance, that you are visiting another country and your wallet is stolen, leaving you stuck without any cash or credit cards.
Fortunately, you may get help by calling the 24-hour customer support number on your card. The customer care agent might be able to provide you with a short-term credit line and assist you in having a replacement card delivered to you. You can travel the world without anxiety if you have the correct credit card.
Increasing your credit score by using credit cards responsibly The possibility to raise
The possibility to raise your credit score is one of the key advantages of having a credit card. Lenders evaluate your credit score, a number that represents your creditworthiness, to decide whether or not to approve the loans you have requested. Credit bureaus utilise the information that credit card issuers provide about your credit behaviour to determine your credit score. You might be able to apply for a credit card with a greater limit and better rewards after a year or so.
Utilising credit card rewards programmes to get incentives for your expenses
In exchange for using your credit card, credit card issuers provide a variety of rewards programmes that let you accrue benefits, points, or cash back. Many of these awards are connected to e-commerce sites like Amazon and Flipkart, which you may already be aware of.
Popular examples include no-cost equated monthly payments (EMI) or points on credit cards from banks like HDFC, ICICI, Axis Bank, and others. These benefits can be applied to purchases or vacations. To get the most out of your card, it's crucial to comprehend the conditions of the rewards programme and to use it wisely. This is a fantastic way to earn points or save money on purchases you would have made otherwise.
Protection against fraudulent activities
You should constantly monitor your credit card account and report any suspicious activity right away if you want to be secure. You may phone the bank to block your card or report a loss and promptly get a replacement if your card is lost or stolen.
A credit card is simple to lose or have stolen. This is why safeguards against fraud are present on the majority of credit cards for customers. This implies that unauthorised use of your card may not subject you to liability. They may then keep an eye on your account for any unusual behaviour, alert you to any possible fraud, and cancel any erroneous charges that have been made to your card.
Having credit card purchase protection and insurance gives you peace of mind
Purchase protection and insurance are features that many banks and credit card issuers include with their cards. For example, the cost of products you purchased with your card but were destroyed or stolen may be covered by purchase protection.
Cards often provide accident and credit insurance in addition to purchase protection. Many Indian credit card issuers provide purchase protection up to INR 50,000, but accident insurance claims can be as high as INR 40 lakh. However, it's crucial to comprehend the terms and conditions of insurance and submit a claim as soon as necessary if one is required in order to use a card for these advantages.
Assists in extending the warranty coverage
Prior to the time when you really need them, certain credit card advantages might not seem like they're all that wonderful. The extended warranty is one such unnoticed benefit that might spare you from the anxiety of unanticipated repairs or replacements.
On specific goods, credit card issuers frequently provide extended warranties, which might offer extra protection on top of the manufacturer's guarantee. This only extends the existing warranty that was provided with the item. However, it may be a lifesaver when it comes to expensive items when even a minor problem might cost a lot to fix or replace.
Now let’s how you can use it in order to benefit your account activity.
Credit cards may help you in many different ways to increase your cash flow, regardless of whether you operate a small business or receive some other type of monthly income. When money is tight, for instance, you may use your credit card to make purchases or pay bills, and then use the remaining balance to make a payment once cash flow is better. You may utilise rewards to pay for some of your bills. Additionally, some credit cards include balance transfer options or 0% introductory interest rates that let you postpone payments or pay off high-interest debt.
Credit cards provide the utmost freedom and convenience by enabling you to make purchases whenever and wherever you choose without having to carry cash. When your account balance is low or paying with cash is not an option due to unforeseen obligations like medical bills or unforeseen purchases, they may be a lifesaver.