Five Benefits of Using Credit cards for Shopping During This Festive Season

People usually plan to buy cars, home appliances or other big-budget items during the festival season as they consider this period auspicious. The other reason is that many companies offer huge discounts during this season.

But, people often take bank loans for purchasing such items as they don’t have enough money at their disposal. The drawback of availing loan is that interest is charged on the loan amount. One of the ways to avail loans at zero interest rate for a limited period is through credit cards.

Here are the five benefits of using credit cards for shopping during the festive season.

Cashback, refunds, credit points

Various merchants and retailers offer discounts, vouchers, higher reward points and cashback on transactions through credit cards. To check which retailers are offering benefits, go to the offer section of the credit card. In case no offers are available, users still get reward points on making payments through credit cards.

Credit score

If someone uses a credit card for purchasing products and makes payment by the due date, his credit score improves. However, if one does not make timely repayment, it affects one’s credit score. Besides, people should note that they should not do transactions above 30 per cent of their credit limit. Not repaying the due amount in time attracts a huge penalty.

EMI options

Nowadays, equated monthly instalment (EMI) options are also available on credit cards. This means one can purchase whatever he wants using a credit card and convert the repayment amount into EMI. This helps reduce the burden of repaying the due money in one go. The period of repayment can vary from a few months to five years.

Pre-approved loans

Those having a good credit score and an excellent repayment history get the option to get loan against their credit card. This loan is called pre-approved loan and it is sanctioned against the credit limit of the card. The benefit of this option is that users receive the amount within one or two day of making the request for loan. People generally take pre-approved loan for immediate fund requirements.

No interest rate

The most important benefit of using a credit card is that people can make transactions without having to worry about interest. Credit card users get a limited time period for repayment of the due amount. During this period, they are not charged even a single penny in the name of interest. This repayment period varies between 18 and 55 days. So, those who want to buy a TV, refrigerator, oven or any home appliances can make transactions through credit card and pay the due amount within the provided period.