A lot of people are wary about using credit cards, because there are several myths associated with them. Chief among these is that they encourage reckless spending. But think about it – is reckless spending a function of a reckless spender, or a behaviour that a responsible spender might suddenly cultivate? If you are habituated to spending within your budget, paying all your bills on time and getting out of debt as soon as possible, you are a good candidate for a credit card.
Did you know that your credit card can keep your money safe? These are 4 ways in which it does: #1 You get access to a line of credit instead of finishing your account money. The fundamental difference between a credit card and a debit card, is that the former offers you access to a line of credit from a reputed bank. The latter is connected to your bank account, so any spends on it directly deduct money from your account. Whereas with a credit card, you can use the bank’s credit for free if you remain within your monthly credit limit and pay the balance/bill before due date. Thus, it is a more cost-effective and financially responsible way of spending money. #2 The best banks offer a range of offers – these save your money. Getting a credit card in Dubai is easy as pie, but not all cards are equally good. Always take a credit from a leading bank in the city, and start by checking your eligibility for the credit card. The credit card eligibility decides what kind of card the bank can give you, and the corresponding range of benefits. Usually, the higher your income and the more established your repayment ability, the better the range of rewards and experiences that the card issuer offers. If you have a higher income you can get a range of benefits on travel, concierge services, points for shopping at member outlets, eating out at certain partner establishments, and so on. These save money in the long run. #3 It helps build credit history. Credit card usage is one of the first behaviours potential lenders check when you apply for institutional funding. If you have a credit card and you use it responsibly – stay within your credit land and pay balances in full instead of carrying them over every month – it ends up adding to your credit score. This is a big plus when you seek a home or car loan in the future. #4 It protects against fraud and phishing attacks. One of the biggest advantages of using a credit card is that it keeps you safe from fraud and online theft, which a debit card cannot do. Credit cards offer greater protection, especially if they have been stolen and you report the loss within 24 hours. Doing so reduces your personal liability in the theft and you are not made to pay the amount that the thief swipes on the card. Second, the credit card is not linked to your bank account so a phisher or hacker cannot access your savings directly. If a transaction is made using your card, you can immediately stop it from processing any further ones with just one phone call to the bank. The hacker cannot steal using your credit card if they depend on its PIN; any theft can occur only if the actual card is stolen. A credit card can be a useful tool for managing your money and buying the things and experiences that you hold dear – plus, it’s safe to use!
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August 2022
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