Is Your Credit Card A Boon Or Bane?

Credit Card A Boon Or Bane

May 18th, 2018   |   Updated on May 21st, 2018

The history of credit cards dates back to 1981 where Andhra Bank was the first one to introduce Credit card to its customers. Since then the credit card industry has been on an upswing. Credit cards now come in more variety of flavor’s than any ice cream.

Credit cards, charge cards, ATM cards etc. and so on. In earlier days it was a privilege for the upper class in the society. But today in 2018, it is more of a necessity for a common man too.

There is not a thing that you cannot buy using the plastic money. Be it groceries, petrol, medicines, bills and the list is endless. It has enabled man to roam around with minimum to no cash.

But, not forget- every coin has two sides. Same is the case with credit cards. Without any doubt they offer lot many benefits and are convenient, but at the same time they come with cons of their own.

Credit card as Boon:

1. Managing day-to-day expenses: Using credit card for managing everyday expenses like groceries, bills payment, etc. is quiet common. It makes cashless purchases very convenient.

2. Rewards & Cashback: Another reason why credit cards are lucrative being the rewards and benefits that the company’s attach to it. You can earn certain reward points for the amount you spend using the card. Another perk attached is the system of getting certain % of cashback money each time you swipe the credit card.

3. Online shopping: Yet another revolution in the digital market is the online shopping trend. You can buy anything and everything at lesser prices. IndusInd Bank Credit card comes very handy at such places.

4. Discounts: Providing discounts on various services and products for the use of credit cards is also on a surge. Axis Bank Credit Card discount offers range from dining, travel, shopping etc.

Credit card as a Bane:

1. Unnecessary expenditure: The use of credit card at times leads to purchase of unnecessary things. A person may end up buying things which he may not be in need of. Extravagant use of cards to show RBL credit card status can cause financial strain. Unnecessary spending in the long run lead to debt trap.

2. Credit Card Fraud: Just like cash being stolen, credit cards also get stolen. People then use it to pay for their own expenses. Another way of credit fraud is hijacking the credit card details which had been earlier used to shop online. It can get the credit card holder in to hard circumstances.

3. Hidden costs and charges: The interest charged on credit cards is not the only one. There are penalties levied in case if the card limit is exceeded or the monthly amount due is not paid on time.

Hence, it is evident that credit cards come with pros and cons at the same time. It is up to the holder of the card to use it for beneficial purposes. Over use or lavish use of the card can lead to a big financial disaster.