What are the Advantages & Disadvantages of Credit Cards?

 

What are the Advantages and Disadvantages of Credit Cards?

Credit Card Benefits,

1. Whether at home or on the go, cash theft is unlikely to happen.

2. With a credit card, you can make purchases from anywhere at any time, without having to go to the store. There is no need to go out with cash to pay various bills, fees. All of this can be done sitting at home.

3. In case of an emergency condition, if you don't have money in your hand, you can get the benefit of meeting the need immediately by using the credit card limit.

4. If cash is lost, the chances of a refund are slim, and if a credit card is lost, the card can be blocked immediately. There is an opportunity to avoid the possibility of financial loss.

5. In the case of credit card transactions, in case of fraud due to any reason other than one's own negligence, considering the importance of the situation, the credit card company bears the responsibility for the fraud, and the customer does not have to face financial loss.

6. Credit card limits can be used free of charge for the billing period.

Suppose someone has a credit card limit of one million rupees and a billing period of forty days (usually forty to fifty days).

He bought a car with the credit card for one million rupees,

Car purchase date, 01-01-2020.

Credit card bill payment date, 09-02-2020.

For this reason, the cardholder does not have to pay any separate amount to the credit card company for using Rs' fund.

Absolutely free, for 39 days, the opportunity to use one million rupees.

7. When cash is lost, it is difficult to find out who got it. If a credit card is lost, there is no need to find out who got it or where. Right away, the card can be blocked.

8. In the case of credit card fraud, it is possible to find out from the system's records how, where, and how the fraud took place. By tracking IP, fraud can also be identified.

9. Credit card purchases and timely bill payments help a credit card holder create a CIBIL record (indicator number of eligibility for a bank loan).

10. As a result of credit card purchases, depending on the total amount of the purchase, Reward points are credited or cash-backed.

The advantage of the reward point is that it can bring gift items, or if you don't want a gift, you can convert the reward point into money (encash) and deduct that money from the bill. The monthly card statement mentions how many reward points have been accumulated.

The difficulty of Credit Card,

1. Due to shopping convenience, the tendency towards unnecessary expenses may increase, and unnecessary financial stress may be created.

2. In case of late payment of credit card bills, high interest will be charged.

3. For credit cards, you have to pay an annual fee.

If you have any inquiries about credit cards, please let me know in the comment section.