A credit card is a payment card issued to users to enable them to pay for goods and services provided by a merchant, by borrowing money from the card issuer and then paying them back later. The following are a few reasons why you should prefer using your credit card over your debit card.
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Bonuses on Signup
The applicants, who have a good credit score, can apply for credit card that offers signup bonuses worth some amount of money. Other cards offer reward points that can be redeemed for some gifts or vouchers. But in the case of a debit card, users get minimal or no bonuses.
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Reward Programs
Credit cards carry reward programs, which offer attractive rewards, bonus points. Customers earn a fixed number of reward points with each transaction done with their credit card. One can redeem his/her accumulated reward points for gifts or vouchers from an online catalog.
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Secure Transaction
Every credit card comes with an embedded chip for protection against fraud attacks and duplication. Each online transaction is a two-layer authentication process. These security measures are very effective in protecting the customers from frauds.
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Add-on cards
Card issuer allows the primary cardholder to avail up to two or three supplementary cards for their family. This feature is provided with no additional cost to the cardholders. The number of supplementary cards that can be issued completely depends on the bank.
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Cash Back Benefits
Credit cards also provide the benefit of cash back to its customer. The customer can avail this benefit only if they spend beyond a limit defined by the bank. Cashback offered varies from 5% to 20%, depending on the bank. The cashback was given to the customer also depends on the category of spend, like grocery, online shopping, dining, etc. The cashback is directly credited to customer’s account.
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Lounge Access
MasterCard and Visa credit cards provide frequent travelers exclusive privilege, that is, VIP Lounge access at various airports. The customers are provided with a fixed number of complimentary visits by the bank.
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Building Credit
Using a credit card responsibly helps its customer to improve their credit score. This is because credit card companies report your payment activity to the credit bureaus. Using a debit card does not affect your credit report; hence it cannot help in building your credit score.
Credit cards are beneficial for those who know how to use plastic money responsibly and in a disciplined way. Users need to be aware of the due dates of the repayment and pay the amount before the deadline passes for a good credit score. If one knows how to responsibly use a credit card he/she can shift all their transactions as many as possible to credit card limiting the use of a debit card for ATM access.