Most of us don’t know we have a choice between different credit cards. The credit card offered to us is the one we accept. But choice is our fundamental right. Banks of India actually provide a dizzy assortment of cards that carry specialized benefits that range from rewards, cashback and shopping to miles, fuel and entertainment. Choosing the perfect card for you can make all the difference between enjoying benefits that are perfect for you or getting benefits that make no sense to you. There’s no perfect card in the world that can be rated number one. The number one card for you depends on your preferences and tastes.
Banks offer different cards to suit the varied tastes and preferences of customers. You need to identify which category you prefer the most to find out which credit card is right for you. You need to identify who you are rather than who you want to be. The main types can be categorised as follows:
Shopping – If you like to shop, lifestyle cards will offer you a number of benefits that include deals, discounts, cashback and rewards. Many times, banks partner with stores to bring you fabulous deals that you will not be able to resist. These cards may also give you access to exclusive sales, previews and more. Shopping cards are not limited to retail shopping. Cards are designed for groceries and household needs. With these grocery cards, homemakers can enjoy deals while they look after their home and family.
Travel – There’s a difference between a person who loves to travel and a traveller. If you actually travel a lot on business or on pleasure, you can earn a number of rewards by spending on your credit card. If you’re a person who loves to travel, but doesn’t actually get down to doing it, this card wouldn’t be the best for you. Travel cards let you earn miles when you spend. It also might provide you great insurance cover for your life, baggage and travel time. These cards may also provide access to lounges and concierge services like flight, hotel and cab bookings.
Entertainment – Do you like going out? If you like clubs, dinners, movies, concerts and more, you could get discounts, complimentary drinks, free tickets, exclusive invites, and earn rewards on your spends.
Fuel – If you find yourself filling up your gas tank often, the fuel cards could benefit you. You will get fuel surcharge waivers. You can earn credit card reward points when you spend on fuel and related products. Make sure you know the details of your credit card. Some cards require you to fill up only at specific petrol pumps or swipe on the bank’s specific machine.
Others – There are a number of other unique cards that are designed to suit special needs. There are rewards cards, cash back cards, student cards, golfing cards, educational cards, and more. Choose the card that you feel would be apt for you.
Apart from choosing the right card, you need to choose the right bank. Many banks may offer you credit cards. You could choose the bank with which you maintain your savings or current account. There are other banks that allow you to take cards without having an account. You can find out about the credit cards you are eligible for by using websites like BankBazaar. You can then view and compare different offers to find the best card for you.
Know the right details:
While selecting your ideal credit card, look at the details. Some of the important information you need to be aware of has been listed below.
Billing cycle - Banks usually set the billing date as the 15th or 20th of every month. Knowing this date is important to get a longer interest-free cycle. If you’re interest free credit period is 45 days and the billing date is 15th, then when you make a purchase on 14th, it will be billed the next day and you do not have a long free credit period. If you make the purchase on 16th, you will get the full 45 days to pay your bill back.
Interest rate - You are charged interest only when you carry forward a balance. If you pay your bills in full, you will never incur interest. So if you are one to pay your bills on time and in full, interest rates shouldn’t matter much.
Annual Fees - Most credit cards carry an annual fee, joining fee and renewal fee. If you are one to use your credit card sparingly, go in for a credit card that does not carry annual fees. Some cards waive the annual fee if you spend above a certain limit. So if you are a big spender, you needn’t worry about the annual fee.
Late Payment charges - Be aware of how much your bank charges if you miss the payment due date. Banks also increase your interest rate when you default on a payment.
Cash Credit - Cash credit usually carries high interest rates and no credit free periods. So cash should be withdrawn only if absolutely needed. Know the details before you use your credit card to withdraw money.
Rewards - If your bank is offering reward points, don’t be taken away by how many points you can earn on your credit card. Credit card reward points are just a small reward for spending on your card. You can usually earn 1 point for every Rs. 100 you spend. You can redeem these points at an average rate of 1000 points for a Rs. 250 - Rs. 500 voucher. So it might cost you Rs. 1 lakh to earn a voucher worth Rs. 500. You can view reward catalogue before you apply for a credit card to see if your rewards are worth it.
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