“A plastic card having a magnetic strip, issued by a bank or business authorizing the holder to buy goods or services on credit. Also called charge card”.
The free dictionary
A credit card is a plastic card issued by a bank in favor of its customer allowing the beneficiary to purchase goods and services on credit to the tune of the amount set on the card. The card is issued after the applicant has undergone a pre screening process which includes check on credit history and verifiable ability to repay.
Here are 6 tips about credit card you will thank us for.
1. Emergency Funds
It gives you opportunity for an emergency line of credit. It gives you access to fund when you are cash strapped. It provides comforts when emergency cost that must be taken care of immediately arises. With your credit card you are sure of enough cash within the limit set by your bank.
2. Credit History
It helps boost your credit ratings. Timely repayment of your credits when it is due improves your credit history and allows lenders view you as a credit worthy person. Just as you may ruin your credit if you are found defaulting on your credit card repayments.
3. Flexible repayment
Credit card provides you with the opportunity to repay whatever amount you may have utilized of your credit limit in flexible terms. For instance some banks allows you to pay only about 15% of what amount you have utilized before the monthly repayment date and 15% of the utilized balance monthly.
4. Borrow for free
You can actually borrow money from your bank free on your credit card. Most have interest free period of between 30 to 45 days. If you are able to pay back whatever you have utilized within 30 or 45 days depending on your bank, then you can have the money for free. You may however, have paid insurance fee when the card was used to pick cash on the ATM or when it was used to pay for goods and services on the net or POS.
5. Revolving credits
It gives you access to a credit line for between 1 to 3 years depending on your bank. It means you can utilize the banks funds, pay back and use again for up to 3 years without a review of your limits. The bank is however at the discretion to remove or alter your limit if you are found to have conduct your credit unsatisfactory.
Your credit card is insured, the limit on the card is insured against lost of income or Job or untimely demise of the card holder. This means that in the event of lost of job or income or even demise of the card holder, the insurance company takes care of the limit utilized on the card leaving your dependent with nothing to worry about.
So approach your bank today with your request for a credit card and enjoy the beautiful word of credit cards.
Read also: Prepaid Card