Credit cards are a form of banking cards issued by the bank or any other financial institute which heel of the cardholder to make online transactions easily without having to worry about the actual balance on his current or savings account. Credit cards or kreditkort helps the users to enhance their financial flexibility. Credit cards are considered to be very helpful in making significant payments or to buy things that are expensive or tough to offer. These credit cards can be used for all kinds of day-to-day transactions.
Rewards with credit cards
Credit cards turn highly helpful when used responsibly. One of the significant advantages of a credit card is the idea of earning while you spend. Yes, this actually refers to the incentives and loyalty points which a person can get by using a credit card sensibly. Credit cards offer incentives such as cash back, air miles or loyalty points to its users which actually encourage the users to use credit cards. So this is a way of indirectly making money using your credit card but this works only if you pay your bill on time and entirely or else you will be charged high rates of interest.
The next significant advantage of credit card is the speed of transaction or purchase that you can make in general. If you want to buy the expensive thing that you feel is not easily affordable, then you can use a credit card and make payments and then spread the cost over a number of months and clear it by making regular monthly payments. But you must make this payment before the end of the interest-free period or else you will have to pay fine or penalty in the form of additional interest being imposed on the amount you borrowed.
Some of the credit cards offer 0% periods that means you get an interest free loan and that with this offer you can make fixed monthly payments and clear your due within the given period of time so that you will not have to pay any additional interest for it. In case you fail to repay the taken amount within the mentioned period then you will have to pay other attention as beautiful the average interest after the 0% offer ends will usually be up to 18% which is quite high.
When compared to debit cards credit cards offer better security because credit cards are not directly linked to your savings account. While using your credit cards,there is always a chance of losing money from your account in case of card theft or card being misplaced. But this is not possible in fact of a debit card,and if you lose your card you can easily block any suspicious transaction just using your mobile phone
But while choosing the credit card always make sure that you decide sensibly because a wrong choice may make you pay more than what you have actually borrowed and in case if you don’t make repayment regularly then there are chances of your card being imposed with high-interest rates which you may find tough to pay