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What is a Credit Card?
It is commonly known as plastic money which is used in place of the cash. A credit card is used to purchase any product from the market on credit. It has 16 digit no., CVV no. and a unique pin no. which has to be kept secret by the user.
It has replaced currency notes and has found a permanent place in our wallets however it is an unsolved mystery for many and thus resulting into hundreds of complaints about excess fees, charges since its poorly understood even though banks give users all the needed information in form of a printed “terms and conditions” that come with their card kit.
The users usually have mixed reviews about a credit card. Some users are very pleased with these while some are so irritated that they strictly deny to have one in the future. We are going to discuss here about the same topic.
Generally, a credit card comes with benefits and some charges which are not actually hidden. Like different cards come with different annual fees, late payment charges and other charges. But when a person applies for a card, he/she often views only the benefits and not other rules and regulations. Somewhere, there is also the fault of sales person as he is not able to properly guide the customer. Which results in his negative feedback. So, is there any solution to this problem? Yes off course, a little attention can save you from unnecessary charges. What you need to do now is read these important tips to follow to play safe with the credit cards.
Any person applying for it must be aware of these facts:
– There is due date mentioned in the bill statement. You need to pay your bill before this due date to avoid late fees. All banks have different late fee like Rs. 750 for a month.
– In the bill statement, two amounts are mentioned namely Minimum due amount and Total Due amount. To avoid interest on your next bill, be sure to pay total due amount instead of minimum due amount. Paying minimum due amount will get you low cibil score and unnecessary charges on your bill. These charges vary with the bank and can be 3-4%
– All the cards have fixed bill cycle and payment date. So, don’t forget to manage your expenses to pay the bill on time.
– Always check your bill statement. And if you think that it needs to be corrected, then do it within 60 days.
– Remember your credit card number always. In case, it is lost then it is easy for you to report it fast to the bank. Also, it can be easy for shopping online because you will not have to take it out always. However, at the time of shopping you also need CVV no. and expiry date. But it’s good to remember your credit card no.
– Check the annual charges and other fees of the bank while applying for a credit card. All the banks have different fees and charges which you need to check. This will help you in knowing about your credit card and the upcoming charges. So, that you would not be surprised with these fees and charges.
– Credit cards come with certain points and rewards program. These points convert into the value like in some cases 2 points = Rs.1 while in some it’s like 4 points = Rs.1. You need to know about these reward points to redeem later.
– Check that is your bank awarding you cashback with shopping. Cashback means that the amount of cashback that your card is liable for will get the cash back in your account at the time of bill cycle. The value of cashback gets debited in your account in the bill statement. This is a good feature and will help you in saving whenever your shop. For this you need to check out that what offer your credit card is offering.
– Don’t use complete limit of your credit card as it can give a loss to your credit score. To maintain healthy cibil score, you need to spend no more than 50% of your credit limit.
– Don’t use your card to pay the bills of other credit card or any other debt. It will lead to bad financial health. Instead you can apply for the personal loan which is available easily at very low rate of interest.