A credit card can help make payments simple. Here's how

Time to read: 3 mins | November 22, 2016

Conventional wisdom suggests that you should spend only what you have in your bank account; and living on credit should not be the preferred route. But contrary to popular belief, if you use a credit card responsibly, you stand to benefit a lot. Here’s how:

• You can opt for a Axis Bank Credit Card that suits your usage and spending pattern. So, if you travel a lot, having a card that accumulates flyer miles will get you discounts on flight tickets, hotel bookings, etc. using those miles. Similarly, if you are a shopaholic, choose a credit card that offers discounts on apparel, electronics and at other outlets. In the long run, this will let you save every time you use your credit card.
• Many credit cards offer reward points and cashback schemes. You can use accumulated reward points to purchase something from the card’s offer catalogue or get the cashback applied to your credit card bill.
• If you make a big ticket purchase, the payment can be converted to EMIs. You can then repay the amount in a convenient manner. However, this benefit is subject to factors like the number of bills generated, amount spent, interest charged for EMI conversion of the specific amount.
• When you get your credit card statement, you can see at a glance just what you have spent each month and how much you paid for what items. Some credit cards even categorize your purchases for you to make it easier to see where your money has gone.
• Using your credit card for your expenses gives you the convenience of easy payments. You can pay one consolidated bill rather than making multiple payments for different services.
• When you have a credit card, it reflects on your credit score. The way you manage your credit card is kept track of so if you apply for a loan, the lender can analyse if you are creditworthy.

Credit cards now come equipped with an EMV chip that makes them even more secure for transactions, so you don’t have to worry about the safety of your banking details. You just need to be sure to spend wisely and make payments on time so that you continue to enjoy the benefits.

Some benefits are also specific to the type of personal loans. Here are the two categories and their features:

• Secured personal loans are allotted against a collateral security and are better suited if you want to take a bigger loan amount with a longer repayment schedule. With this, you can get a quick and easy sanction owing to the fact that you have already placed a collateral security. The interest rates are also on the lower side as compared to the unsecured variant.
• Unsecured loan program does not require you to pledge any collateral so it is ideal for those who can’t place a guarantee against their loan claim. This scheme is lent out for shorter repayment tenure with a slightly higher interest rate. However, you can get your application sanctioned just as quickly as the secured type if you are eligible.

Personal loans are one of the easiest forms of finance that are available today. The advantage of personal loan lies in solving unsorted personal expenses. Just make sure you are familiar with your needs and budgetary limitations before availing such a loan.