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5 Benefits Of Using A Credit Card


Most of us don’t use credit card thinking that it will make us end up in debt. Following this old school, we don’t usually pay heed to the advantages that credit cards have over other methods of payments.

Overspending with a credit card will indeed make you pay huge interest, but if you use your credit card wisely, then it can give you enormous benefits. The advantages of credit cards go far beyond mere convenient usage especially during emergencies. Read on to find out 5 benefits of using a credit card.

Benefits of using credit card


What Is A Credit Card?

Credit cards are plastic cards issued by financial institutions such as bank. They allow the holder to purchase goods or services on credit. The credit which the user takes needs to be repaid in the given time to avoid huge interests. Users get the credit card swiped at offline retail stores or enter details online to make transactions.

Benefits Of Using A Credit Card

If you spend conservatively and make your credit card payments on time, then credit cards can offer you the following benefits:

1. Cash Back

Shopping with a credit card often gives around 1-5% cash back on purchases. Users can get cash back opportunities while paying their monthly bills, online shopping and more using credit cards.

2. Reward Points

Many banks offer reward points on purchases via retail outlets, travel bookings and more. The accumulated points can be redeemed later to purchase gifts from company’s reward page.

3. Safety & Convenience

It your credit card is lost, you can immediately ask your bank to block the card. This will avoid any unauthorized person to make transactions using your card. Moreover, emergencies where you need cash can happen anytime, and if you don’t have cash available in such situation, then using your credit card at that time is a better option than going to a bank to withdraw cash.

4. EMI Option

If you want to buy expensive products such as electronics items, then you can make the payment through monthly installments using your credit card. You may however have to pay certain amount of interest for converting the payment into EMI’s.

5. Build Credit History

If you use your credit card responsibly and make your monthly payments on time, then it will help you build good credit score. Credit card companies report your payment activities to credit bureaus. If you have good credit score then it means that you can be trusted by lenders. This will benefit you at the time of lending money from financial institutions.

These are the benefits that credit cards offer besides convenience. Hope you found this post useful. Don’t forget to share it with your friends on Facebook, Twitter and Google Plus.

Also Read: 9-Point Checklist To Keep In Mind Before Buying House In India


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