Santa Claus comes around just once a year. In the meantime, there are Credit Cards.
  • Things to Remember Before Swiping CC

    If there is one financial product that has revolutionised the world it has be to credit cards. These small plastic cards have completely revamped the way individuals purchase and sell items. Credit cards also come with a lot of offers making it advantageous for customers to use this product. The number of credit card issuances are growing by the day and with the recent ‘demonetization’ ruling by the Indian government, the figures might just grow bigger as most individuals prefer going cashless while paying for their purchases. According to information provided by the Reserve Bank of India, individuals have also increased their dependency on credit cards for their debt related requirements.

    As on 31st August, outstanding loans on credit cards were Rs.46,300 which was an increase of 28.7% as compared to 2015. This could be attributed to a number of reasons. One of the most common is that individuals fail to pay their due on time or just pay the minimum amount that is due. This can lead to their getting trapped in a vicious cycle of debt. While most banks function based on credit card spends, misusing these products can do more harm than good.

    Mistakes that Individuals Make while using their Credit Cards

    There are other mistakes that individuals make while using their credit cards which could affect them financially. The most important mistakes to avoid are given below -

    Revolving Credit

    Banks provide customers with the option to pay only the minimum amount due on their credit card bill during the end of their interest-free period. Additionally, the remaining amount can be carried forward to the next month. The catch here is that customers will have to pay an interest every month on this amount. This may seem to be a small inconvenience, however this amount can accumulate to over 35% on an annual basis. The amount that individuals would pay later will attract interest each month until the complete amount that has been paid.

    Paying the minimum amount due seems to be the easy way out, however experts warn that this could lead to card holders falling into a debt trap which will have an impact on his/her credit score and also on their financial standing.

    Multiple Equated Monthly Installments (EMIs)

    Individuals who wish to procure a luxurious product or service can do so through the option of Equated Monthly Installments or EMIs. Using this option that is provided by most banks, individuals can repay the amount that they have used on their credit card through Installments every month. The rate of interest charged on this is lower than the annual rate of interest that is charged by banks on outstanding amount in case of revolving credit. While rate of interest varies across banks, it is usually in between 13% to 18%.

    Although this option is feasible, customers should not depend on it completely as well, as it could again result in their falling into a debt trap. Cardholders must also take into consideration the processing fee and other applicable charges.

    Cash Withdrawal

    Banks and lenders allow cardholders to withdraw cash from their credit card from any of the ATMs that are affiliated to that particular bank. While this might seem like an additional method to procure cash, the charges levied on this service is quite heavy. Interest rate on this is more or less equal to the rate that is charged for revolving credit facility. Unless individuals have cleared out their outstanding amount, cash withdrawal comes with a higher rate of interest.

    Credit Score

    Credit score is a 3 digit numeric representation of an individual’s credit worthiness. Compromising on this would result in pretty serious repercussions for the individual. If the cardholder fails to pay the due amount on time, it can negatively impact his/her credit score. Without a good credit score, it will be difficult for the individual to procure loans and other credit cards.

    Reckless Spending

    Credit cards work as temporary loan providers for individuals. However, this can also lead to individuals spending more money than they should. Indulging in excessive or unplanned spending is detrimental to the cardholder’s financial health. Repaying these would be a huge burden. Hence, only planned and necessary spending should be done through credit cards.

    Credit cards are extremely popular and also very useful. However, misusing them can be just as bad. Credit cards also come with various offers and discounts on dining, fuel, shopping and other services. Using credit cards judiciously can enhance the customer’s credit report. By ensuring that they are careful regarding their credit card spends, customers can make the most of all that credit cards have to offer. Financial discipline should be given priority. If not, customers can get trapped in a viscous credit cycle of debt which will be hard to come out of. As long as cardholders do not follow the practises mentioned above and use credit cards wisely, they can enjoy all benefits of this financial product.

      

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    Credit Cards Reviews

    • IndusInd Bank Credit Card
      "Good card"
      0.5 5.0/5 "Blown Away!"
      Recently applied for INDUSIND BANK PLATINUM AURA EDGE CREDIT CARD, they have not charged me annual fee, the credit limit which they have given to me was good, there was no specific reason behind choosing this card, the card came on time, the process of getting credit card was good.
      Was this review helpful? 0
      , new delhi
      Reviewed on Apr 20, 2019
    • ICICI Bank Credit Card
      "Good Credit Card"
      0.5 5.0/5 "Blown Away!"
      ICICI gives good support to the customer, but the charges are bit higher for the late payment. The credit limit is very sufficient, I am using this card around 1.5 year. Whenever I use my card they are providing the points for fuel purpose its good.
      Was this review helpful? 0
      , virudhunagar
      Reviewed on Apr 20, 2019
    • Bank Bazaar Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      Since registered member of Bank bazaar i was aware about this website .Need to aware of the current situation from bank end .whether customer is applying for any product communication should be transparent and should not miss guide anything beyond the process.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • Citibank Credit Card
      "GOOD"
      0.5 5.0/5 "Blown Away!"
      I have been using the credit card with the CITI BANK where they have given the good offers also the customer service good with this bank as they are responsive and the card service is good without any hassle process. There is a EMI option with this card.
      Was this review helpful? 0
      , pune
      Reviewed on Apr 20, 2019
    • ICICI Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I hold ICICI bank credit card from long time, they have not charged me annual fee, i am happy with the credit limit which they have given to me good credit limit, i am happy with their service, they use give good offers in shopping, movie tickets etc.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • IndusInd Bank Credit Card
      "Not Satisfied with the Service"
      0.5 3.0/5 "Satisfactory"
      I have applied for Indusind Bank Credit card .The agent gave the required details and not faced any issue.This is a free card but after that paid the charge of Rs.900. This was not informed earlier .The Bank agent not gave the relevant details about the charges.I was not satisfied with the service provided by the bank .Other than that it was ok.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • YES Bank Credit Card
      "GOOD"
      0.5 4.0/5 "Great!"
      The process of getting the YES BANK credit card is simple and easy also the card has the good credit limit along with that it is hassle free to use. It has the offers like rewards points, cash backs, online purchase. The card is good card to use.
      Was this review helpful? 0
      , pune
      Reviewed on Apr 20, 2019
    • ICICI Bank Credit Card
      "GOOD"
      0.5 4.0/5 "Great!"
      I have taken the credit card with the ICICI BANK and the card limit is good i have been using the card since from last few years and the documentation process was simple with fast to get the credit card. There was satisfactory offers with this credit card.
      Was this review helpful? 0
      , pune
      Reviewed on Apr 20, 2019
    • Standard Chartered Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I took Standard chartered bank credit card, They have not been charging me annual fee, the credit limit which they have given to me was good, they have given me limit on based on my expectation, their mobile application is user friendly , so far experience was good with this card.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • ICICI Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I use Kotak mahindra bank credit card from long time, They have been charging me annual fee but waiver option is available , i am happy with the credit limit which they have given to me, they use to give good offers in airport lounge, their service was prompt, my experience with this card was good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • SBI Cards Credit Card
      "GOOD"
      0.5 4.0/5 "Great!"
      I am holding the credit card with the SBI CARD the credit limit with this card is satisfactory also the card is user friendly to access. I am getting the offers but i am using it also the card has the EMI conversion option it is easy to convert the payment.
      Was this review helpful? 0
      , pune
      Reviewed on Apr 20, 2019
    • HSBC Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      HSBC credit card service is good, they use to give give good offers, like based on my requirement i take offers whenever i get, they have not charged me annual fee, their customer care service is good , they response me well, they use to give good credit limit.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • HDFC Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I hold HDFC bank credit card for an while, They haver given me good credit limit based on my requirement, they did not charged me annual fee, their service is good, they did not charged me any hidden charges, i can easily transfer into emi option whenever i want, their overall service is good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • Citibank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I hold CITI bank credit card from longtime, they have charged me annual fee , but waiver option is not available , the credit limit which they have given to me was good, they use to do good transaction, their offers are good, they use to give good cash back and discounts everytime.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • Axis Bank Credit Card
      "Average card"
      0.5 3.0/5 "Satisfactory"
      I hold Axis bank credit card from long time, They have not charged me annual fee, the credit limit which they have given to me was good, but i am not happy with their service, their service is not that up to the mark, their customer care should be improved, there is no issue with card.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • IndusInd Bank Credit Card
      "Average card"
      0.5 3.0/5 "Satisfactory"
      I applied for Indusind bank credit card recently. The process of getting card was simple and easy, the card came on time, the reason behind choosing this card is for their offers they use to give good offers in movie tickets every 1+1 movie tickets every month they give. I am happy with the credit limit which they have given to me.
      Was this review helpful? 0
      , mumbai
      Reviewed on Apr 20, 2019
    • HDFC Bank Credit Card
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      I am using this HDFC Bank Credit Card for the past 4 years.The credit limit was good and i have directly applied with the bank.There was good cashback offers and reward points .There was no difficulties faced so far .I have received the credit card on time .The service is good to me so far.
      Was this review helpful? 0
      , new delhi
      Reviewed on Apr 20, 2019
    • Kotak Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I am also using Kotak credit card and got reward points and I donâ??t know how to redeem my points and this information is not provided on the mobile app too.The customer service is okay and even the branch response was prompt. I think, they do charge annual fee of Rs.500.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Apr 20, 2019
    • IndusInd Bank Credit Card
      "AVERAGE"
      0.5 4.0/5 "Great!"
      They have given the good offers so i have taken the credit card with the INDUSIND BANK. The documentation process was good but there was delay to get the card which is twenty days. The credit limit is good and satisfactory and it is a life time free card.
      Was this review helpful? 0
      , bangalore
      Reviewed on Apr 20, 2019
    • Bank Bazaar Credit Card
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      I have no issues with Bank Bazaar and its been a good experience. I have installed the mobile application to check the credit score then it is easy to apply the card according to the offers. I have been using it for long time. The executive explained the details very clearly about the product.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Apr 20, 2019
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