Many people put off applying for a credit card, worrying about the interest rates and the possibility of falling into debt. The reality is that credit cards can be a very useful tool when you use it wisely. If you clear your dues within the due date, there is absolutely no need to fear credit cards. Credit cards come with a grace period (generally up to 45 days). Once you make it a habit to pay the due amount within this period, you need not pay any interest at all. First you need to know about what is credit card and its benefits.
If you are applying for your first credit card, here are some essential things to consider:
- The rate of interest:
The rate of interest charged by the financial institution should be the first thing to know before you apply for a credit card online.
- Annual fees:
Some companies often charge an annual fee and additional taxes. Keep yourself informed about these charges.
- Reward points:
Reward points are one of the many benefits why individuals opt for credit cards. You can earn reward points for every transaction made via your credit card. These points can be redeemed later in the form of gift vouchers, coupons, cashbacks, etc.
- Credit card type:
Majority of the cards are designed to meet specific types of expenses. Some common purposes for which you can apply for a credit card online include:
If you are a shopaholic, you must opt for a shopping credit card. These can give you higher reward points, offers, and discounts when shopping online or offline.
If you frequently travel by air, then a travel credit card can suit your expenses better. You can even use the reward points for purchasing air tickets for free.
You can also get access to airport lounges. For example, the Bajaj Finserv RBL Bank World Plus SuperCard offers up to 8 complimentary lounge accesses every year.
- Fuel surcharge
If you tend to spend more on fuel, these cards are for you. Such credit cards offer waiver of fuel surcharge when purchased from partnered petrol pumps.
- Credit limit
The credit limit defines the total amount you can spend with your credit card. This credit limit depends on your income, CIBIL score, credit history and many other factors.
- Minimum repayment due
At times, you might find it difficult to repay the entire due amount. Failing to make the payment within the due date will attract additional charges over and above the actual due amount. Under such circumstances, you can opt to pay the minimum due amount.
On doing so, the actual due amount is added in your next billing cycle without incurring any additional interest.
So, there are many features and benefits of a credit card which you can avail if you use it wisely.