[dropcap]M[/dropcap]ost first-time credit card applicants assume that this financial product is just another means to purchase products. However, the truth is, a credit card is much more than that.
Credit cards help you enhance your credit score, build your credit history, earn you rewards, discounts and cashbacks, provide superior protection, and a lot more. It also imbibes a financial discipline in the user.
However, as a first-time user, you should know the significant benefits of using a credit card before applying for one. Some of the most significant ones are as follows.
Improves credit history
Your card plays a crucial role in building your credit history. Using the cards wisely and repaying your credit bills on time will significantly improve your CIBIL score. This further increases your chances of getting loans or credit cards with higher limits easily.
Barrier between the trader and your money
Most credit cards come with protection and security that ensure your money is safe. The credit card companies are good at handling fraudsters in case there’s an unauthorised use of your credit account.
You may also face a situation where you want to return a product after purchasing it. The reason can be a faulty product or bad service. In such cases, the financial company helps you reverse the payment from the retailer without any hassle.
Reward points and cashbacks
You can choose your card depending on your spending pattern. For example, your choice can depend on whether you spend more on travel tickets, groceries, clothing or fuel. Now, you’ll get reward points and cashbacks depending on the card you choose.
Tips to choose the right credit card:
You have to keep multiple things in mind when you apply for a credit card for the first time.
- Know the difference between a secured card and a normal card
Secured credit cards are given against fixed deposits. Thus, the lender can forfeit the F.D. in cases of non-payment. On the other hand, you don’t need any security to avail the services if you go for unsecured credit cards. There are many lending institutions from where you can get credit cards of both types.
- Consider your spending pattern
As mentioned earlier, choose your credit card depending on your lifestyle. Go for a card that gives travel bonuses if you often travel for work purposes or vacationing. Or, select a card that gives discounts on apparels or groceries if you purchase these items more.
- Know your credit limit
Depending on your credit score and credit history, the card issuer fixes the credit limit that you can use every month. Know your limit before getting one. However, try to avoid utilising the entire credit limit every month as this can hurt your CIBIL ratings.
- Go for special features
Credit cards like the Bajaj Finserv RBL Bank SuperCard offer features like emergency loans and protection plans like Zero-Fraud Liability Cover. It also has exclusive features of interest-free cash withdrawal from ATMs if you repay the amount within 50 days.
Hence, if you do not own one yet, apply for a credit card that comes with benefits such as easy EMI product financing, reward points, discounts, minimal processing fees etc.
Nidhi Mahajan is a Business and Finance Content writer and She Loves to write all the Latest Information On Business and Finance. For More info you can check her Business and Finance Contents at pop-pins.com
