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Credit Card Pros & Cons: All You Need to Know

Just like there are 2 sides to a coin, everything comes with its own set of benefits and drawbacks and a credit card is no different. When you consider whether you must purchase a credit card, you should know that credit cards can never hurt your financial health if properly used. It will instead assist you in improving your financial well-being. However, there are a few crucial reasons why you may be worried about making the decision to avail yourself of a credit card for yourself. Listed here are a few of the credit card benefits and drawbacks of credit cards. Also mentioned here are how you can overcome the drawbacks of credit cards and effectively use them.

Credit card benefits

Credit cards nowadays are a must-have financial instrument. Below listed are some of the reasons – 

Luxury of credit

Holding a credit card endows you with the luxury of spending from your pockets. With credit cards, you can borrow money from issuers and conduct the required purchases. All you require to do is plan your finances wisely so that you can pay the used amount on time. Additionally, you can also borrow as per your requirement on an interest-free credit period that ranges anywhere between 18 and 52 days.

Affordable EMIs

Do you conduct huge purchases through your credit card? Do not fret about repaying a massive amount. You can select to convert your outstanding dues into affordable, easy EMIs and repay the dues over a long time period. Doing so will help you meet your dues as per your repayment capacity without burdening your finances.

Build good financial health

Timely credit card bill repayments assist in building a good financial status. One of the massive credit card benefits is its responsible usage can assist you form and maintaining a credit line. This credit line can be used by the issuers to view your credit card usage and credit repayments.

Ameliorates your credit profile

Using your credit card in an effective manner shows you as a responsible and disciplined user. Hence, holding a credit card allows you to improve your credit score. Credit cards usually are used as credit builders to ameliorate and improve your borrowing habits. With proper utilization of credit cards, you gradually can form your credit score, which helps you to manage your credits and loans over a time period.


Credit cards are extremely secure and safe financial tools. When compared to other financial instruments, credit cards hold a lot of safety features. Dissimilar to old credit cards, those being issued in current times are highly secured with the EMV chip, which ultimately saves you from falling prey to frauds. Moreover, various credit card and bank issuing companies have started different security measures that ensure safety during transactions. Alongside this, the RBI has made it compulsory for banks to take the liability of the customer in the case there is any unauthorized electronic transaction. Thus, the card user does not require proving his or her innocence if there is any fraudulent transaction through online mode.

Balance transfer

When properly used, one of the biggest credit card benefits is that it permits you to easily transfer your funds from one credit card account to another. This choice allows you to reduce your applicable interest charges. For example, if you have any pending credit card bills and insufficient funds to make the bill payment at that moment, then you can select to transfer your credit card balance to another issuer and avail the benefit of lower interest rate charges by the new issuer. Moreover, in a few cases, you might be offered zero percent introductory finance charges on balance transfer options. However, in some cases, you might also require paying the fee for transferring your balance.

Simple loan approval

A SBI credit card even permits you to borrow loans from issuers. When you do this, your issuer makes the transfer of money against your available credit card limit to your account. Once you get the loan approval, the applied loan proceeds are transferred to your savings account in a few minutes. Also, you must remember that having good credit or borrowing history will work effectively on your score, i.e., it will improve your credit score.

Additional advantages

There are various additional credit card linked benefits offered upon the transactions made through a particular kind of credit card. Such additional benefits are offered in the form of cashback, discounts, and reward points that can easily be redeemed for future transactions. Also, you can choose to avail of credit cards based on your specific requirement. This kind of credit card will provide additional benefits on your spent amount.

Record of expenditures

Whenever you use a credit card, all your transactions made through it are saved. Such details are visible in your card statement. Having a thorough record of your expenditures on your card can assist you in simply managing your finances and forming your budget in a better manner.

Drawbacks of using credit cards

While credit cards offer innumerable advantages, there might even be some credit card disadvantages. Thus, before you hit on the SBI credit card apply button or opt for any other credit card, ensure to be aware of the drawbacks linked with it. Note that once you have applied for the card, you can check your SBI credit card status or status for any other card by contacting the concerned issuer.

As mentioned, excess of anything may be harmful, and it is advised that you use your credit card effectively. Here are a few of the factors that might come across as negative if you do not use your credit card responsibly.


As credit cards provide you credit to a massive extent, there might be instances wherein you might make unnecessary buys of the available limit and then fall into a debt trap. To avoid overspending through credit cards, ensure to understand your repayment capacity and spend according to it. Ensuring this would help you remain tight on unnecessary expenditures and will help you to be away from overspending.


Even while credit cards are looked upon as the safest financial instrument, they might still be vulnerable to online fraud. Thieves or fraudsters might steal your card info and misuse it. Moreover, if fraudulent transactions are done by any 3rd party, it becomes the responsibility of the card user to inform the bank in 3 days about its occurrence. To protect yourself against these fraudulent transactions, ensure to disable foreign transactions on your credit card. Moreover, you are recommended to not open any text or mail that appears suspicious. Alongside, avoid handing over your credit card to anyone and sharing the card details or PIN.

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