With the festive season just around the corner, your shopping list getting longer by day is not a wonder. Every time you remember a gift or item to be included in the list, which you have otherwise left out, a few items just might be added on to the list. And with that, the expenses increase too. Given that you stand to incur a substantial expenditure, using credit card during a festive season can be highly advantageous for you.
To that effect, one also needs to know process of credit card application to avail it with minimum hassles. So, once you are through with the process, make sure to check the advantages accompanying the card.
Here are a few significant benefits of using credit card during festive season.
Advantages of using credit cards during the festive season
- Accelerated savings
While the festive season is in full swing, a large number of retailers and merchants extend a host of benefits by way of discounts, increased reward points, cashbacks, vouchers, etc. on transactions made through a credit card.
During a credit card application, you may see your credit card’s offer section to search for all the online platforms and retail outlets where such cashbacks and discounts would be valid. In case such offers are not available, a credit card can be utilised for an accumulation of reward points regularly. For instance, the Bajaj Finserv RBL Bank SuperCard comes with almost up to 20,000 reward points as a welcome gift.
- Managing cash flow during the interest-free period
If you use a credit card to make all the shopping during this festive season, the transactions will be financed free of cost within the interest-free period. This period includes the specific time duration between transaction date and the payment due date following the concerned billing cycle. In this period, the credit card company would not charge any interest. So, if you have multiple credit cards, your big-ticket expenditure can be spread in such a manner whereby the optimum interest-free period may be availed. It pertains to one of the main reasons why you are smarter with a credit card in your pocket.
- Expenses converted to EMIs
In the instance where you have ended up incurring a substantial expenditure on the credit card bills, the same may be converted into Equated Monthly Instalments (EMI) partly or in full. It takes away the added pressure on the repayment obligation of the credit cardholder and makes it easier to repay the credit card debt.
- No-cost EMIs
Your credit card may likely have a tie-up with specific merchants who extend no-cost EMIs on big-ticket purchases. The cardholder will only need to bear the purchase cost through the EMIs, whereas interest costs are internalised by the merchants.
- Improvement in credit score
The transactions that would be undertaken through a credit card are equivalent to availing loans for short durations. So, timely repayment of the dues would leave a positive impact on the credit score as relevant for any other type of loan.
However, the point of distinction in this regard is that if the bills are repaid within the due date, you would not have to bear any interest for the credit utilised. While you are considering how to get a credit card, keep in mind that the credit utilisation ratio (CUR) of the particular credit card should not ideally extend beyond 30% of the credit limit because under such an instance, the credit score is negatively affected.
- Meeting immediate fund requirements
If the individual has a reliable repayment history, then certain financial institutions extend pre-approved offers for as well. This is an essential aspect in case of credit application.
For instance, the pre-approved offers provided by financiers like Bajaj Finserv simplify the process of availing advances. Such an offer is available on other financial products as well like personal loans and business loans. You can check your pre-approved offer by entering only basic details such as your name and contact number.
Apart from the benefits mentioned above, a credit card would also enable you to make good of the shortfalls in cash as well as management of finances during festival. Make sure to consider other aspects such as your repayment capacity to utilise these cards to their maximum while ensuring affordability.
