Credit cards are a significant digital asset we can use anywhere in the universe. The main good reason credit card helps to generate a financial identity of a person. It secures from fraud or aid during an emergency period. More another reason why credit cards play a role as a good friend.
WHAT IS CREDIT CARDS?
Creditors offer a plastic card with a pre-approved limit that allows you to borrow capital from approved limits for purchasing products. The limit of credit card is determined according to the credit score or previous statement. The higher the credit score, then limit will expand.
HOW CREDIT CARD ACTS AS A GOOD FRIEND?
Create a credit statement – While taking a loan, credit scores are taken from credit history for your financial activity. All missing dates or time to time repayment are listed. The bureaus monitor credit score to track credit card balance on time for investigation about fraud.
The longer credit card use builds more credit history. Some lender does not require credit score but the interest rate high. If your credit history is not good, you need good credit score preparation.
Recurring payments – There is no chance to forget if you set an automatically recurring payment for utility bills, electricity bills, or many smart software bills. Credit cards are best for one time payments.
Fraud Protection – The government reformed a low concerning consumer credit. Under Section 75 of the Consumer Credit Act, creditors must provide protection above￡100 and below ￡30000 payments.
By fault, if the amount goes the wrong wallet or any company deceives, then you can claim for refund to credit card institution.
Worldwide accept – No tension while traveling in any country. Most credit cards accepted universally. A credit card is a best friend in a foreign country during booking rooms, emergency, rental.
Some experience only available at low prices by credit cards. Like as, scuba diving, desert camel riding, sea zone, etc. All hotels accept credit cards or the best way to reduce currency exchange rates by credit cards rather than paying high exchange rates at the airport.
“CREDIT CARDS ARE A REALLY GREAT CHEAP SOURCE OF FUNDS”
Emergency – During any emergency, we can pick a credit card instead of a friend. Many times everyone has no above $500 to deal with an emergency ( booking flights, meals, car repairing, shopping, or many more).
Whatever interest rate, it is the best of using a card instead of taking a payday loan that interest rate always high.
Track spending – Credit card companies track your spending where, how much, when & how often you spent on purchasing — all data they store in a statement.
Business expenses, rental property expenses, charity contributions, and more tricky tax return areas all show up on a credit card statement.
Rewards & Cashback offers – Nowadays, we can see a lucrative offer on an e-commerce website with 5% – 10% off on electronic gadgets till a limit time or combo offers only via credit cards. Moreover, for earning a point, we need to purchase more items via credit card.
After that, we can redeem points into a gift card voucher that can easily use in other online portals. More cashback offer appears while booking a domestic or international airfare.
Some credit card offers free air ticket only for people who have booked more flight of the same airline. So why we can say a credit card as a good friend.
Convenience – It allows us to contain huge cash while spending holidays in a different place. For example, if you want to make a party on the beach, then you can not keep more cash in your pocket.
Credit card saves safe money, or sometimes we plan to visit more countries in a month, so we will not need to buy the currency of every nation and stand at airport foreign exchange stalls again and again.
Car rental – Some rewarded car rental firms require booking cars by credit card, not debit cards. Sometimes, in saving accounts has no massive amount of what they demand, so they lock up huge fund until we don’t return cars.
Extend warranty – Some credit card companies have a partnership with manufacturers. They offer an extended warranty scheme if anyone purchases things by credit cards from XYZ supplier or manufacturer. In that case, we have a double warranty.
Interest rate – We have a specific period of repaying our debt amount that may be different according to companies’ policy. However, I did take a loan of $700 from my Axis bank credit card then returning time was 30 days.
Till 30 days no interest rate. Most credit cards have a month duration to return the money after then interest rate charge may apply.
Monthly installment – The credit cards good reason is the converted debt amount in EMI. The consumer has two options to pay the loan by full-time payment or monthly installment.
Many times peers take debt for works, and plans fail. Due to a lack of capital, they choose to repay the borrowed fund by equated monthly installments.
In conclusion – As a good friend always wants to do well of ours in the same way, a credit card never wants to hurt our finances, but our bad habits compel credit cards to do deficit our capital. We should repay a credit card loan before the due date for an excellent future score.