Things need to know about Credit Card Today

Creditcard Meaning

     An individual gets a credit card from any bank and financial institution. A cardholder can enable the credit card in borrowing funds from any of the above institutions. According to the terms and conditions of financial institutions or banks, a Credit cardholder can pay the interest for his money taken as credit. 

Difference between Credit Cards and Debit Cards: 

            Both cards are issued by financial institutions or banks with some same features as plastic cards with 16-digit numbers, expiry date magnetic strips, and EMV chips. With one key difference. We can use both cards either in stores or online for our shopping. 

We use Debit cards depending upon our cash deposited and have a limit.  We use Credit cards to a certain limit depending on the cash we borrow from the issuer. 

Credit cards and their categories: 

Types of Creditcard

   Banks or financial institutions issue cards in various categories, they are : 

  • Reward  Credit Cards: It is one type of credit card issued by banks which is very beneficial to the customers in getting cashback offers like travel points, gold: and purchase based on their use 

  • Premium credit cards: Cards are used to give perks to steward services, airport lounge access, and more but usually collect more fees on this card. 

  • Standard Credit Cards: It is a normal credit card in which an individual can make their transactions for shopping, fund transfer, etc. No annual fees. 

  • Secure Credit Credit Cards: A cardholder should maintain initial cash in this card as security. 

  • Balance Transfer Cards: Balance transfer fees from one credit card to another have lower interest rates. 

  • Charge Cards: A cardholder should pay fees monthly on these cards and also no usage limit on them. 

Credit card benefits

 Credit cardholders have more benefits than debit cardholders by using reward points on their cards. He should be aware of reward points when it expires and what options on them before redeeming them

Advantages and Disadvantages of Credit card 

A credit card is a good financial tool if it uses properly. 

  1. Convenience: It is so convenient to use irrespective of the balance in our account. We can purchase things with higher interest rates which we cannot pay with our credit cards. 
  2. Record Keeping: A Credit card account gives us monthly statements and an online account on our expenditures. 
  3. Cash Rewards: We can get cash by using this option, we can draw the cash for our needs but have higher interest rates. 
  4. Member Perks:  We can get a wide range of discounts and cashback offers depending on our purchases. We avail the best perks on smart shopping. 
  5. Build good credit history: If we properly use a credit card, and pay back the cash at the right time with interest, lenders can give us an offer with less interest rate. 

   Purchase protection and low-cost loans are also advantages of credit cards. 


  •  Temptation: It is very easy to use which makes us tempted towards overspending. 
  • Interest Charges: We are paying more interest on our purchasing items along with the purchase price. 
  • Fees: We are paying not only the interest on our purchases but also annual fees on our credit cards. 
  • Monthly Scrutiny:  We should be aware of fraud usage of our credit by scammers, so we should review our monthly bill. 
  • Tricky short-term interest rates: It seems to be a good deal for cardholders, but it is temporary. In end, a cardholder pays more interest than expected. 


      Credit card plays a vital role in our day-to-day financial commitments. It is the best financial tool to meet our requirements. Before taking any financial instrument either credit or debit we should be aware of its nuisances.