Credit Cards – An overdraft facility by the bank
Hey readers, today’s topic is very interesting because today we are going to talking about credit cards.
A credit card refers to that facility by which a bank allows the facility to its customers that they can use an overdraft facility when they require it.
Credit cards are of many types and the types are.
1. Business Credit Cards
These types of cards are generally used for business owners so, that they can use this to do their business transaction easily and separately.
2. Limited Purpose Cards
These types of credit cards are used for specific payments for specific places.
These types of cards contain many types of cards like gas credit cards and many others.
3. Prepaid Cards
In this type of card, the cardholder has to maintain the money into the card.
These cards don’t contain minimum payments because the withdraw is done from the balance you made. This card is just like debit cards.
4. Sub Prime Credit Cards
These cards are called the worst credit card because a customer can apply if they have a bad credit score because in the issuing process of this credit card the credit value is not checked. They charge very high interest.
5. Secured Credit Cards
This type of credit card is made for those people who don’t have a credit history.
It only contains the security deposits on the place of this card. The number of secured credit cards is equal to the amount on the card.
6. Charge card
It doesn’t have a credit limit and the whole balance was paid in full. It doesn’t have a preset spending limit. It also not contain a minimum limit because the whole of the balance was paid in full.
7. Student credit card
This type of card is specially designed for college students. These types of credit cards are issued to college students who have a minimum and no credit history.
8. Rewards credit card
Rewards credit card refers to that kind of card that is given as an offer or as a reward. It has three main types Cashback, Reward points and many more.
9. Balance Transfer credit card
This card contains a low introductory rate on balance transfer for a certain period of time. Their interest is very low or sometimes 0. To avail the facility of Balance Transfer Credit Card you have to maintain a good credit score.
10. Standard credit cards
Standard credit cards are also called ‘Plain vanilla’ credit cards.
The best advantage of this type of card that they are easy to understand.
In this service, the bank who provides you this type of credit card sets a certain limit for revolving balance.
So, here we have discussed what is a credit card and what types of credit are present in our market.
Now, we are going to understand the advantages of Credit Cards
1. A credit card contains an overdraft facility so we can do a transaction when we have no money in our bank account.
2. It helps us to improve our Credit Score.
3. It increases the purchasing power of its users because they can buy anything which lies in the limit of their card no matters that they have money or not.
4. It reduces the carrying cash system
By using Credit Card we don’t have to carry cash if we want to buy something. We can easily do the transaction through credit cards.
So, we are here discuss the advantages of Credit cards. Here are some disadvantages of credit cards.
1. The biggest advantage of a credit card is that this card appreciates its holders to spend more on purchases.
2. If the payment of credit card not received in time it changes huge interest to their users.
So, These are the Whole information about the Credit card.