The Credit Card is just opposite to a debit card. It gives us the opportunity to take emergency money in credit or as a short-term loan.
It gives quick money from bank’s own account while debit card gives the money from account holder’s deposited money. Credit card is very much helpful if you want to use it as emergency loan. When you get a card like American Express Gold Card, you can cash money from ATM.
What is credit card?
A credit card is made as a rectangular piece of plastic or metal. It has two sides. One side of the credit cards contains the name of the card user, Chip, Expire Date and credit card number in golden color and other side of that card contains CVV code number, Signature, Magnetic strip and Hologram. The card is issued by a bank or financial services company that allows cardholders to borrow cash with which to pay for products and services with merchants that accept cards for payment. The card is also usable on the internet to pay for something online.
It is also good for shopping in a sense of discount. Many credit cards give the opportunity of discounts in restaurants, fashion house, electronic shop, jewelry etc. We can share some credit cards name which is giving rebate regularly.
Most major credit cards—which include Visa, MasterCard, Discover and American Express—are issued by banks, credit unions or other financial institutions. These are Wells Fargo Active Cash Card, Citi Custom Cash Card, and Capital One Quicksilver Cash Rewards Credit Card.
In terms of study loan, “Discover it Student Cash Back card” is very flexible credit card for students.
It gives rebate or cash back in no time. And Blue Cash Preferred credit facilities from renowned American Express card. Bank of America Customized Cash Rewards credit card is popular among American people.
Blue Cash Everyday Card from American Express and American Express Blue Business Cash Card are also in the list of most used credit cards for its cash back offers.
Credit cards of Citi Bank are just nice credit cards. Citi Diamond Preferred Card and Citi Double Cash Card are the names of the cards.
Other discount heaven cards are Chase Freedom Unlimited, Capital One Venture Rewards Credit Card, Chase Sapphire Preferred Card, Chase Sapphire Reserve and Secured MasterCard from Capital One.
Credit cards are used in bill payments, like tuition fees, electricity bill, gas bill, fuel refill, water bill, internet connection bill etc. Credit cards are amazing in diagnostic center and furniture mall.
By money law, credit card issuers must offer a grace period of at least 21 days before interest on purchases can switch on to deduct. We can look at the points include the benefits of a credit card.
Benefits of using a credit card?
Credit Cards can give a Cash Advance facility: The credit card issuer may approve a separate cash line of credit (LOC) to credit card user, enabling them to borrow money in the form of cash advances that can be processed through bank tellers, ATMs or credit card convenience paper.
Credit Cards can make a Credit History: Credit scores are important in banking. Cardholders can build strong credit scores and potentially extend their lines of credit using credit card.
If you pay bills regularly before last payment dates, you will earn good credit scores. When the credit scores are good, you can apply for regular big loan for house building, car loan, or business loan.
Credit Cards can be the Rewards credit card: Many credit cards entice customers by offering incentives such as airline miles, hotel room rentals, gift certificates to major retailers and cash back on purchases. These types of credit cards are generally denoted to as rewards credit cards.
Branded Credit Cards gives good discounts: Many big retailers issue branded versions of credit cards, with the store’s name emblazoned on the face of the cards as the program of building customer’s loyalty.
Although it’s typically easier for consumers to qualify for a store credit card than for a major credit card, store cards may only be used to make purchases from the credit card issuing shops, which may offer cardholders perks like special discounts, promotional news, or special deals.
Deposit facility with Credit Cards: Secured credit cards are giving facilities of medium of the deposit. These are a type of credit card where the credit card user secures the card with a security amount savings.
Such cards offer limited lines of credit that are equal in value to the security deposits, which are often refunded after cardholders demonstrate repeated and responsible card usage over time. These cards are often sought by individuals with limited or poor credit scores.
Advantages of a Credit Card
For any purchase, you can pay in next month without any interest. It is giving EMI facilities for big size product such as refrigerator, furniture, motor bike, car, television, computer etc.
Cash money may be possible in need. Sometimes you need to pay cash; in that case you can use ATM.
Sometimes social status may find some extra miles. It is still controversial thing, but some people think like that.
Big loan may be possible with good credit history. After a while, Good credit score will be your wealth in banking system.
Foreign currency support is available in the credit card. In travel time or online purchase, credit card can save your time and money to pay with foreign currency.
Bad Sides of a Credit Card
Interest rate of the credit card is higher than general loan account. It is not acceptable, so that globally, card users give negative reviews on the blogs and social networking sites.
Card holder may increase his consume rate. Shopping habit gets extra-large size. Its other side is increasing product’s price in the market.
Bank may be defaulter for issuing a high number of bad credit cards massively to generate more profit from card users. Idle money may be the default money.
May argues that banks are saying low interest rate but receives high rates. This is a common allegation against bank officers. They give false hopes.
Hidden charge is a common issue in the credit card backdrop. People dislike such things as they want to trust banks.
Read: What to Do if Your Credit Card is Lost or Stolen?
Profit making from stores, that is good but some people say, this is not a good thing for regular banking nature. They are not Business Company.
Involving in the interest game, which is not good for healthy personal finance. Giving and receiving interest of money is prohibited in good business relationship. It is a hate thing in Muslim society.