Over the past few years, the boost in demand for credit cards has been noticeable. Its journey from a luxury financial instrument to a handy tool has also converted several cautionary mind-sets. With useful and attractive credit card features, this particular payment option has changed the way borrowers used to consider debt.
Nonetheless, these features can differ across different financial institutions and product line itself. Similarly, there are a few fundamental features of credit cards that remain constant. Unlike debit cards, any fraudulent transactions on credit cards are 100% reversible. Generally, the card-issuing authorities take immediate actions against any such unaccounted transactions reported by the cardholders.
Thus, borrowers can secure their expenses by using these cards. Here are some of their other notable features –
-
Instant funding
One of the most useful credit card features is instant funding that helps borrowers to meet daily financial obligations without any hassle. With the help of this financial tool, individuals can purchase a wide range of products or services like groceries, entertainment, gas, jewelry, air tickets, etc. Furthermore, various utility bills such as electricity, cooking gas, post-paid mobile bills, etc. can also be paid for by these cards instantly without compromising the liquidity of one’s finances.
Depending on earnings and obligations, borrowers can repay the bill generated either through EMIs or at once.
-
Credit limit
The credit limit represents the maximum amount that borrowers can spend on their cards. This maximum spending limit comprises of purchases, cash withdrawals, balance transfer, and financial fees. Card users can assign the entire borrowable amount as per their requirements without any end-usage restriction.
Nonetheless, borrowers should always try to keep the expense amount on credit cards less than a specific threshold of the total limit. This way, they can maintain a low credit utilization ratio as well as an excellent history.
-
A tool to improve the credit profile
Credit cards are also considered as a great tool to enhance the creditworthiness of users. It offers closer insights into individuals’ credit behaviors like repayment patterns, credit usage tendencies, etc. Thus, card users should always repay the full monthly bill on time as card outstanding not only accumulates interest but also adversely impacts their credit portfolio.
Furthermore, borrowers need to be careful about their credit card online and offline purchases. The expenses should never exceed their repayment capacity as it helps them to pay off the debt amount within the due date.
Therefore, with responsible usage of credit cards, users can build a promising credit profile that reflects their creditworthiness.
-
Exclusive reward programs and customized advantages
Another attractive feature of these cards is customized incentive programs. In other words, most credit cards offer various rewards like points, discounts, vouchers, coupons, cashback, etc. on specific purchases. Card users can redeem reward points and use them to enjoy perks on their future transactions.
For instance, with cashback, borrowers can avail of a certain percentage of the expenses back to their accounts. Other incentives such as coupons, vouchers, and discounts can be availed on different credit card online transactions and utilized in upcoming purchases.
Read More: 6 Benefits of Credit Cards Over Debit Cards
This way, individuals can save a significant amount of money on recurring spending through credit cards. Thus, it is important to understand the spending pattern and select a card as per its reward program. For example, for individuals who travel frequently, any incentive on the hotel or flight ticket booking can be helpful to manage cost-efficiently.
-
Grace period
Every billing cycle comes with a statement date and the due date. The statement date signifies the end of one billing cycle, and on this date, borrowers receive the account of expenses incurred during the concerned month. The payment due date is usually 15-20 days from the statement date, and card users are entitled to repay the bill amount before this due date.
Moreover, individuals need not pay any interest if they can settle the complete payable amount before this due date. Also, any purchases after one billing cycle are accountable for the next cycle. That means borrowers can get 45-60 days to pay for their purchases during the grace period. So, individuals should know how to use a card wisely to enjoy the maximum benefits of it.
For better credit card features, individuals can avail of RBL Bank Credit Card from NBFCs like Bajaj Finserv. This card offers several advantages and benefits like charge-free cash withdrawals from ATMs, loans against unused credits, etc.
Lastly, individuals should consider these credit card features while comparing the available options to choose the best one at hand. They should know all the important things before applying for a credit card to ensure their financial stability and enforce disciplined spending habits.