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Know the Advantages of Owning a Credit Card
Money & Co

Know the Advantages of Owning a Credit Card

M Saran

According to the recent update by Reserve Bank of India, there are approximately 30 million active credit cards in India. Demonetisation may have added on to these already rising numbers. Moreover, various companies are now introducing a range of credit card offers to benefit the users further.

Not just offers but advantages of credit cards are also diverse. Some of the known benefits of these financial tools are easy access to funds, smooth transactions, universal acceptance, etc. But, you can also enjoy a few lesser-known advantages.

Know the Advantages of Owning a Credit Card

1. Improve your CIBIL score –

The CIBIL score is a scale ranging from 300 to 900 which signifies your creditworthiness and financial stability. A healthy score of 750+ makes you more eligible for financial products or services in the future.

If you want to improve your CIBIL score with your credit card, ensure to make your monthly bill payments within the due date. Defaulting on a bill payment or paying only the minimum amount can decrease your score. Also, always try to keep your credit utilization ratio within 50%.

2. Joining rewards –

Most financial companies provide with welcome bonuses as their credit card offers. Lenders like Bajaj Finserv come with 20,000 reward points as joining gift. You can redeem these points for exciting discounts, coupons, and offers to make your future purchases more affordable.

3. Aids in global shopping spree –

You can use the best credit cards on your international trips as well without worrying about foreign exchanges. So, book your flight and accommodation, shop souvenirs, etc. and finance miscellaneous expenses during the trip. There are no conversion charges applicable in this case.

4. ATM withdrawals with no interests charged –

Credit cards from leading NBFCs like Bajaj Finserv allow interest-free ATM cash withdrawals for up to 50 days with a processing fee of 2.5%.

5. Reward points and benefits –

One of the most profitable advantages of credit cards is the rewards points it offers. Cardholders can redeem these points for:

  • Travel miles – You can convert the reward points into travel miles which can be beneficial during travels with family and friends. Besides, you can also redeem reward points for offers and discounts on flight bookings, food, accommodation, etc. There are airline-branded credit rewards as well which can be redeemed for offers on flying miles in that particular airline.
  • Cashback – Users can also redeem reward points for cashback which will be reflected on their next credit card bill. In case of cash back credit cards with flat interest rates, the percentage of cashback is the same on every purchase. The cardholders can redeem their reward points for direct money which is discounted from the succeeding bill.
  • Gift vouchers – At times, when reward points are redeemed for gift vouchers, cardholders often get a 10-20% discount. They may get additional benefits of free delivery or gift-wrapping, VIP entry to events if the reward cards are directly linked to stores or brands.
  1. EMI purchases – EMI financing can be vitally helpful during financial crunches. Credit cards allow you to convert your purchases into monthly installments. Therefore, you can make every expensive transaction affordable.
  2. Security of cards – One of the significant advantages of credit cards is the security assured with transactions through them. Certain cards like the Bajaj Finserv RBL Bank SuperCard offer ‘In-hand security’ along with ‘Zero-fraud liability cover’ to protect against cybercrime.
  3. Emergency loan – Urgencies can crop up anytime. If you need immediate cash, you can also apply for an emergency personal loan against the credit’s unutilized limit.

A growing number of people prefer credit cards because of the simple and straightforward eligibility criteria. The requirements are basic and simple to adhere to – stable employment history, age limit ranging from 25 to 65 years of age and a CIBIL score of 750 or above.

If you wish to apply for one soon, approach a reputed financial institution which brings the credit card offers as per your requirements.

Bajaj Finserv brings pre-approved offers which make the process of availing finances simpler and helps save the customer’s time. Pre-approved offers are also valid on credit cards and several other financial products and services. Check your pre-approved offer by providing a few essential details like name, phone number, etc.

With proper utilization, credit cards can be one of the most beneficial tools for you. Pay your credit card bills on time and make sure not to pay just the minimum amount. Maintain this routine and avail a higher credit limit other than leading benefits.