Importance of credit cards :
Having a credit card in today’s world is a necessity. So, we have to know the importance of credit cards. For e.g. we book our reservations in hotels, flights and restaurants via this card. These cards are a ready source of a revolving line of credit, whenever necessary, we make use of it. According to credit card issuers, the best credit card holder always maintains a balance at the end of each month after paying off the minimum balance.
The issuers have made sure that the acceptance of payment through credit card is easy and is available across different areas. Also, a credit card makes an impact on the credit history of the borrower. These credit history in turn will be determining the rates and terms of different loans which a borrower is granted of. Higher the credit score, lower the rate and vice versa. So, now we
know the importance of credit card and credit history.
The average cardholder in America has about a dozen of credit cards with minimum credit debt of $13,000. The reason is that credit card usage is not limited only to reservations. The other uses are : cashless transactions (no need to carry cash), online and telephonic shopping, cash advances through ATM during the most needs, shopping can be done when there isn’t enough money, ‘no-interest’ loan from the time of purchase till the payment is due etc. These are in real sense important. These are the importance of credit cards.
Cash once lost can never be retrieved. But, credit cards are retrievable. Thus, no fear if by chance misplaced. Moreover, credit cards have nowadays become a financial tool. How? The credit card companies provide their customers with a processed record of the financial outgoing, so this record can be treated as a tool of budgeting. If the credit cards are of students, they may gain economic
budgeting knowledge through these records.
The credit card issuers like Visa, Master Card, American Express along with the credit provides it’s customers with benefits and privileges like rebates, flyer miles etc. But, there are few responsibilities on the part of credit card holder too. S/he must be paying off the debts on time, should be aware of the prespending line and to maintain the credit worthiness.
If the holder does not follow by these responsibilities, the credit score may easily fall down and hence make it difficult for the holder to maintain good credit history. If one is able to maintain their spending and payments effectively through credit cards, then they are rewarded with higher lines of credit and if the card holder fails to manage, the table may turn worse on the part of the borrower.
Thus, from the above writing, we have come to realise the importance of credit cards and moreover the perfect maintenance of it. Hopefully, the article has served your purpose. If yes, ensure a comment from your side in the comment box positively. Take care!
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