THINGS TO KNOW BEFORE HAVING A CREDIT CARD

What is credit card?

            The word "Credit" itself  means something given to you on the basis of your credentials. If you continue to maintain your credentials more credit will be provided to you. Similarly, what actually banks do is that they provide you the virtual money in the form of card whose limit depends upon the nature of  your banks statements and  monthly earnings.

How to get Credit Card?

             There are lots of companies where you can apply for credit cards. There are also various online platforms from where you can apply . Any person who is working professional, businessman, self employed having valid PAN Card , Banking transactions and IT return can get this card very easily.

Benefits of credit Cards

             If you wisely use the credit card then there are lots of benefits which you can avail. Some of them are as under:-

A)  Period of repayment

           Most of the banks give the time for repayment of about 45 days to 50 days. But, you have to understand one thing that if your billing cycle start at 20th of March and ends on 20th April, then whatever you have spended  upto 20th of April is taken into account and you have to pay that whole of the amount which is accumulated within  this period by 8th of May. So, the most important thing that you need to understood is that if you spend something on 20th of april than you will get only 18 days for repayment of the outstanding. amount

         So, basically  point is that you get 45 to 50 day only for the repayment of those amount which you spended on the 20th of March.

            And, if you are salaried person then you should be very careful with your expenditure calculations so that you are in situation to repay the outstanding amount . As most of the people find difficulty in managing the credit card and they got themselves into serious trouble. So, if you are good in maths and can manage this 50 days period wisely then CREDIT CARD is for you.

            Most of the banks also give the grace period of 2 to 3 days for  repayment if you fail to repay the outstanding amount within the due date without any penalty.

B) How you can use this Period of repayment wisely

             Now, the queston arises is that how we can use this 45 to 50 days wisely. Nowdays, everyone is having smartphones and they are actually using various e-commerce apps like Paytm, Amazon etc for shopping. So, if you are using  e-commerce platforms for purchasing something and by paying through credit card you are actually paying vitual money. And you can use your cash money in some other important purpose during this period. Moreover, it is upto you how you manage between your virtual money and real cash money.

C) Various kinds of Payback points and offers

              Most of the credit cards are linked up with the PAYBACK points which get accumuluted and you can use it in various places like Big Bazar, Petrol pumps and for Movie tickes etc. In addition to that ,many electronic gadgets company having tie ups with credit card companies which offers a lucrative discounts and also No cost EMI options.

D) No Cost EMI option

          In No Cost EMI option , companies are not going to charge you the interest but they will charge the GST on the interest+ principle amount. For example, you purchased any product costing Rs.10000/- and interest amount you need to pay for six months installements is suppose Rs2000/-. Then the total amount you are paying is 12000 in which they wavied off the Rs.2000/- interest amount but the GST(18%) on Rs.12000/- is Rs.2000 which is divided equally in the six intallments.

E) Insurance benefits

     Many credit card companies also provide the medical insurance and also life insurance.

F) The most important part of the credit card is that suppose you are in vacation or somewhere else apart from your home city and your credit card get lost, then in that case credit card company not only settle your hotel bill along with your returnig flight tickets but they also give you some money so that you can come back safely. And all the expenditure will  added in your next bill.

Drawbacks

The only drawbacks is that if you failed to pay the outstanding amount on the due date then penalty charges is very high and it also affect your CIBIL score .There is lots of benefits of the Credit cards but one has to use it very wisely.