Credit cards become a valuable financial tool once you learn to use them sensibly and responsibly. It offers rewards, protection, convenience and helps build an effective credit score. So, what kind of benefits can one reap using a credit card? To begin with, let us examine some of the top advantages of using a credit card:

Credit Card : Benefits

Arguably, the most attractive feature of a credit card is the interest-free grace period that can be availed by users provided, the amount to be repaid, is cleared by the due date. IndusInd Bank allows up to 50 days of credit to its customers without having to pay interest.

Credit grace period (Spend Now Pay Later):

Since credit card transactions are similar to availing loans, all such transactions are reported to the credit bureaus that use them for calculating, as well as building your credit profile. Credit scores become crucial if you plan to avail loans towards business expansion, vehicle purchases, personal needs, or simply buying a new home. A healthy credit score empowers borrowers to negotiate the best deal with the lending institution, thereby helping them fulfil their financial goals.

Credit score: 

These include benefits like discounts, cash backs, reward points, loyalty credits, complimentary club memberships, free access to the airport lounges, among many others. You must select the card that offers the most and matches your lifestyle requirements.

Rewards and Benefits: 

You can time your big-ticket purchases in a way that can help you gain a longer credit period. <ul><li>Making purchases through credit cards in the initial days of the billing cycle can maximize the grace period. </li><li>Some card issuing companies provide a graphical view of your spending pattern that are divided into period buckets basis expense categories. </li></ul>This can help you analyze your expenses and make necessary adjustments to your cash flow plan.

Cash flow planning:

Banks and financial institutions offer Cardholders the option of paying for certain purchases through Equated Monthly Instalments (EMI). In fact, several card issuers even walk that extra mile, to offer interest-free EMIs with tenures ranging from 3 to 36 months. This is a useful option for those who do not wish to pay for large purchases in one go. Instead, they are comfortable spreading out the re-payments over a few months.

Credit card EMIs:

Credit card issuers offer pre-approved loans to card users with a healthy re-payment record and credit profile. Some credit card issuers offer loan amounts (with tenures ranging from 6 to 36 months) that are over and above the approved credit limit. This comes in handy in case of financial exigencies.

Instant pre-approved loan: 

The benefits of Credit cards are discussed in this article. 

Benefits of using credit cards: It offers rewards, protection, convenience and helps build an effective credit score

Explained: The benefits of using credit cards

Most people assume that owning a credit card means that you'll be swarmed in debt  but this is not always true. Let's explore the reasons why.

How to Avoid Piling Credit card Debts

Reading through the terms and conditions that come with opening a new credit card is important so you can ensure that you are getting favorable terms compared to what competitors are offering (this would require you do a little digging beforehand). For instance, you can find out what interest rates other issuers are offering and at the risk of stating the obvious, go for the credit card with the lowest interest rate.

1. Read the Fine Print

Credit card issuers prefer that you use your card for making purchase payments, if instead, you withdraw cash at an ATM, for instance, you get charged a transaction fee, finance charges and a higher interest rate. It’s the most expensive transaction you can make with a credit card.

2. Avoid Cash Advances

Medical bills may show up unexpected but putting them on your credit card is not the answer. Doing these will cost you a lot of money in interest instead, call your doctor or hospital’s billing department and ask about your options, hospitals usually have a structure for interest-free monthly payment plans.

3. Avoid Putting Medical Bills On Your Credit Cards

The better your credit card score the lower interest you should have to pay. If your credit score has improved and you have always cleared your bills on time, it might be time to give your credit card issuer a call. Most credit card issuers provide varying interest rates to cardholders based on their credit score. Look up your credit score by logging into your credit card issuers site then compare with the varying interest rates your issuer offers to find where you belong.

4. Negotiate A Lower Interest

Consumers are more likely to spend more money when they pay by credit card, this is said to be because people do not experience the abstract pain of payments. Staying on a budget is all based on your self-regulation but you can consider applying the following tips:Monitoring your payments, removing the autofill card option from your online shopping option, never using more than 30% of your available credit. Added to that If you can’t afford it without a credit card don’t buy it, limit the number of credit cards you have so your payments become easier to track.

5. Stay on a budget

Paying off your balance each month helps you avoid interest completely and improves your credit score. Using an autopay feature ensures that you never miss a payment and therefore never have to worry about paying extra in interest.

6. Link a bank account & Turn on Autopay

Emergencies are one of the reasons people go into credit card debt therefore building a safety net by saving or investing in appreciating assets will ensure that whatever the future throws at you, you’ll have the capacity to return a serve.

7. Have backup savings or investments

These Ideas show how to enjoy the rewards that come with using a credit card while also avoiding the threat of drowning in debt.

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Rewards, Debts and Interest: A Complete Guide to Credit Card Management

I try to avoid anything that would lead to debt, most people would too yet even though credit cards fall in this category; it remains one of the most popular means of payment. Why?

Why do people get credit cards?

If you don’t have a credit history, you won’t have a good credit score. A credit score is a number that rates your credit risk. Creditors use it to determine whether to give you credit and what terms to offer you. Having a high score can make it easier for you to get a loan, rent an apartment, or lower your insurance rate. Having a properly managed credit card increases your credit score.

1. Building Credit

If you need to buy something and you don’t have the cash on hand. A credit card can be a very expensive type of loan but circumstances can make it difficult to ignore.

2. Emergencies

With a credit card you can get cash back on your purchases, airline points, discounts, coupons and more. These rewards are not available for Debit card users

3. Rewards

Most credit cards can be used internationally and online, whereas cash and bank cards often cannot, you’d have to use some form of currency exchange or maybe PayPal (if it’s an option).

4.Convenience

For some transactions providing a credit card is compulsory. For instance, hotel reservations or car rentals may require that you submit a credit card as this would ensure that whatever extra costs you run up can be easily recovered.

5. Inevitable

These ideas help to understand why credit cards remain a popular means of payment despite being a form of debt.

There are not many things more familiar than credit and debit cards yet while their popularity remains undeniable, some parts of their workings remain obscure especially with credit cards. Understanding credit card payments, rewards, debts and interest can provide a major boost and security to your financial well-being and in the sections listed below, I’ll…

<ul><li>The use of credit cards originated in the United States during the 1920s, when individual firms, such as oil companies and hotel chains, began issuing them to customers.</li><li>References to credit cards have been made as far back as 1890 in Europe. Early credit cards involved sales directly between the merchant offering the credit and credit card and that merchant's customer.</li><li> Around 1938, companies started to accept each other's cards. Today, credit cards allow you to make purchases with countless third parties.</li></ul>

Credit Cards: The Beginning

Credit cards were not always been made of plastic. Throughout history, there have been credit tokens made from metal coins, metal plates, and celluloid, metal, fiber, paper and now mostly plastic cards.

The Shape of Credit Cards

The inventor of the first bank-issued credit card was John Biggins of the Flatbush National Bank of Brooklyn in New York. In 1946, Biggins invented the "Charge-It" program between bank customers and local merchants. The way it worked was that merchants could deposit sales slips into the bank and the bank billed the customer who used the card.

First Bank Credit Card

<ul><li>In 1950, the Diners Club issued their credit card in the United States. The Diners Club credit card was invented by Diners Club founder Frank McNamara as a way to pay restaurant bills (1950). A customer could eat without cash at any restaurant that would accept Diners Club credit cards. Diners Club would pay the restaurant and the credit card holder would repay Diners Club. </li><li>American Express issued their first credit card in 1958. </li><li>Bank of America issued the BankAmericard (now Visa) bank credit card later in 1958.</li></ul>

Diners Club Credit Card And American Express

<ul><li>Credit cards were first promoted to traveling salesmen for use on the road. By the early 1960s, more companies offered credit cards by advertising them as a time-saving device rather than a form of credit. American Express and MasterCard became huge successes overnight.</li><li>By the mid-70s, the U.S. Congress begin regulating the credit card industry by banning practices such as the mass mailing of active credit cards to those who had not requested them. </li></ul>

The Popularity of Credit Cards

When was the first credit card issues? Credit has been around a long time and has come in the form of metal coins, metal plates, celluloid and more.

Stashed ideas

Who Invented Credit Cards?

<ul>
<li>The concept of a multiple-establishment credit card came in the mind of Frank X. McNamara in 1949, when he had forgotten his wallet and was unable to pay for his dinner at a fancy restaurant, where he was dining with his relatives.</li>
<li>Store-specific credit accounts were used at that time, but a single credit card capable of handling all merchant establishments, and involving a middleman company, was never thought of before.</li>
</ul>
McNamara founded The Diners Club, the first credit card company, in 1950.

The Birth Of The Credit Card

The initial card offered by Diners Club didn’t involve revolving credit, and the dues were to be paid off in full by the end of the month. The credit cards that we see now came much later.
Initially targeted at salespeople, the company started charging a $3 annual fee and also charged the establishments 7 per cent for each transaction. The paper-based cards showed tremendous growth in a year, with 20,000 people using it.

Convenience In The Pocket

Eventually, the Diners Card became a status symbol and more and more establishments began to trust it. The company printed a list of participating merchants for the help of the members.
Innovative ideas, like associate cards for married women who wanted to shop in the afternoon using their husbands money became popular.

Status Symbol

The founder of the card didn’t think this ‘fad’ would last long and sold off his shares in 1952.
With American Express coming in the picture in 1958 and two banks started their personal credit card business at the same time (MasterCard and Visa), the concept of a universal credit card turned into a multi-billion dollar business.

The Concept Of A Universal Credit Card

Though the concept of credit has existed longer even than money, it wasn't until 1950 that the first modern credit card was invented.

Explained: The benefits of using credit cards

Rewards, Debts and Interest: A Complete Guide to Credit Card Management

Rewards, Debts and Interest: A Complete Guide to Credit Card Management

Who Invented Credit Cards?

Incredible True Story of the Very First Credit Card

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