Credit cards offer many benefits that can make your life easy and provide convenience. The benefits that can be availed through credit cards are:
Secure Alternative to Cash – Carrying cash comes with a certain risk. If your wallet is lost or stolen then there is not much you could do to recover the lost amount. However, a credit card can be hotlisted so no one can use it. Also if you make payments with a credit card but the services were not rendered, then you can dispute the transaction. This will lead to an investigation by the credit card provider and in the interim period, a temporary credit is extended to the user equaling the disputed amount.
Emergency Cash – Crises do not come with a warning and at such times additional cash or credit can help one immensely. Whether it is a medical emergency or an urgent cash requirement, credit cards can come to your rescue by providing cash against credit.
Increased Purchase Power – Credit cards can be used to spend more than you actually have. Credit limits mean you can spend over your actual income. This allows you to make those big purchases that you otherwise could not make.
Interest-Free Credit – Credit cards offer you interest-free period on purchases. This means you do not accrue any interest on your spends as long as you pay off the amount within due date.
Grace Period – The Reserve Bank of India has made it mandatory for the banks to provide a grace period of three days to their customers. Customers won’t incur any late payment charges during this period. The banks will also not report the late payment to Credit information Companies during the grace period.
Reward Points – Many credit cards offer reward points on the transactions you make using them. These Reward Points can be redeemed on items, gifts, vouchers, etc. Some of these credit cards offer accelerated reward points when used for certain transactions like flight booking, dining, online or retail shopping, etc.
Credit Score – A long term benefit of owning a credit card is that you can build a credit score especially if you have never taken up a loan. The credit score is not generated until an individual takes up a loan. The score monitors the individual’s financial responsibility so if you haven’t taken up a loan then you won’t have a credit report. This will prove to be a hindrance if you apply for a loan in the future. This is because banks are apprehensive to lend money to individuals whose financial behaviour is not known. So owning a credit card is a prudent financial decision.
Tracking purchases – Transactions made on credit card are always recorded. Your monthly credit card statement will tell you when and where all the transactions were made. This can be used to make your monthly budget and see where you are spending a lot of money.
- Premium Benefits
Premium cards come with additional benefits that are aimed to offer convenience to the financially elite. These benefits are:
Golf Program – Many premium credit cards offer complimentary golf rounds at golf courses around the world. The program can offer complimentary training session, entry fee, green fee, etc. any additional fee will be borne by the individual.
Concierge Services – Many premium credit cards offer concierge services to the user. The service can be used to make travel itinerary, flight and hotel bookings, gifting and in some cases make any legal wish of the cardholder come true.
Insurance – Few premium credit cards also provide insurance to the user. The insurance offered can be life insurance, air accident insurance, burglary insurance, etc.