Credit cards play an essential role in modern-day financial life. They offer consumers a convenient way to purchase goods and services, earn rewards, and access credit when needed. While credit cards can be a useful tool, it is essential to use them responsibly. One significant mistake that credit cardholders make is missing credit card payments. In this article, we’ll explore credit cards in detail, the benefits they offer, what happens when you miss a credit card payment, and the options of credit cards available, including the Bajaj Finserv app.
Understanding Credit Cards
A credit card is a form of payment where the issuer lends money to the cardholder, allowing them to make purchases while accruing interest charges if the balance is not paid in full every month. Credit cards come with a credit limit, which is the total amount of money that can be borrowed. Interest charges are typically levied on the unpaid balance, and late fees may apply for late payments.
Shopping with Credit Cards
One of the key benefits of using credit cards is convenience. They are widely accepted and can be used for online and in-person shopping. They also offer rewards such as cashback, reward points, or discounts on purchases. Additionally, credit cards can assist in building a good credit history, as well as providing access to credit during emergencies or cash flow gaps.
Benefits of Credit Cards
Credit cards offer several benefits, including convenience, cash-back rewards, buyer protection, fraud protection, and credit score improvement. Most credit cards offer some form of reward program, which can range from cash-back on purchases to airline miles or other rewards. Credit cards also offer consumer protection for purchases made with the card, including fraud protection, refund policies, and extended warranties.
What Happens When You Miss a Credit Card Payment?
Missing a credit card payment can result in several consequences, including late fees and finance charges, interest rate increases, damage to credit score, and legal actions. Late fees and finance charges may be added to the account when payments are missed or made after the due date. If the cardholder continues to miss payments, it can result in an increase in the interest rate charged on the outstanding balance. This can result in higher interest charges, and it can take longer to pay off the debt.
Missed payments can negatively impact the credit score. Late payments can stay on the credit report for up to seven years. This can lead to increased difficulty in obtaining credit and higher interest rates for future loans. In extreme cases, missed payments can result in legal actions being taken against the cardholder, such as wage garnishment, seizure of assets, or legal proceedings.
Options of Credit Cards Available
There is a wide range of credit cards available in the market with varying benefits, interest rates, and fees. Here are a few types of credit cards:
1. Rewards Credit Cards: These credit cards offer reward points, cashback or other benefits for purchases made with the card.
2. Balance Transfer Credit Cards: These credit cards allow the transfer of an outstanding balance from one or more credit cards, typically with low or 0% interest rates for a fixed introductory period.
3. Business Credit Cards: These credit cards offer special features and benefits for businesses to manage expenses, and cash flow, and earn rewards.
4. Student Credit Cards: These credit cards are designed for college students and offer rewards, low or no fees, and credit-building opportunities.
5. Secured Credit Cards: These credit cards require a security deposit are designed for individuals with limited or bad credit and offer a means to rebuild credit over time.
Options for Credit Card Apps Available in the Market
There are several other credit card apps available in the market that offer numerous benefits, including mobile access, reward tracking, and payment management.
Bajaj Finserv Credit Cards:
– Bajaj Finserv offers several credit cards with various features and benefits, including rewards, cashback, and discounts on shopping, dining, and travel.
– The Bajaj Finserv RBL SuperCard offers 20,000 reward points as a welcome bonus, 10X Reward Points on Dining, Movies and utility bill payments, and 5% Cashback on Grocery spending.
– The Bajaj Finserv Health First Credit Card covers health expenses, such as doctor’s appointments, diagnostic tests, outpatient services, and pharmacy bills.
Citibank Credit Cards:
– Citibank offers a range of credit cards, including rewards, cashback, and premium cards with travel, dining, and lifestyle benefits.
– The Citibank Rewards Card offers reward points on every transaction, and the accumulated reward points can be redeemed for various merchandise and vouchers.
– The Citibank Cashback Card offers cashback on movie ticket bookings, telephone and utility bill payments, and more.
HDFC Credit Cards:
– HDFC offers a variety of credit cards, including rewards cards, premium cards, and co-branded cards with airlines and hotels.
– The HDFC Regalia Credit Card offers rewards points on every transaction, with benefits including airport lounge access, travel insurance, and concierge services.
– The HDFC Moneyback Credit Card offers cashback on every transaction, with benefits including fuel surcharge waiver and zero liability on lost or stolen cards.
SBI Credit Cards:
– SBI offers a range of credit cards, including rewards, cashback, and secured cards.
– The SBI SimplyCLICK Credit Card offers rewards points on online shopping and bill payments, with benefits including fuel surcharge waiver and milestone rewards.
– The SBI Card ELITE offers rewards points on every transaction, with benefits including airport lounge access, welcome benefits, and movie ticket discounts.
Credit cards offer a convenient way to make purchases, manage cash flow, and earn rewards. However, it is important to use them responsibly, by paying bills on time, staying within the credit limit, and avoiding overspending. Missing a credit card payment can result in several consequences, including late fees, interest rate increases, damage to credit score, and legal actions. There are various credit card apps available in the market such as Bajaj Finserv, CRED, Paytm First, and Google Pay that offer unique benefits, mobile access, and payment management. By choosing a credit card and an app that aligns with your needs and financial habits, you can reap the benefits while keeping your credit health intact.