Credit card usage benefits and side effects

February 26, 2025

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New Delhi: Credit cards have both advantages and side effects. Their use depends on your financial situation, habits and responsibility.

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Support for emergency expenses: Credit cards can provide you with immediate financial help when you suddenly need money.
Debt: If you make your payments on time and stay within your credit limit, it will not affect your debt.
Reward Points and Rewards: Most credit cards offer you various types of rewards, cashback, discounts and points that you can use in the future.
Improves credit score: Making timely payments keeps your credit score good, which helps in getting a loan in the future.
Security: If your credit card is lost or stolen you have protection from the bank and are not responsible for any fraud.
Convenient: Making purchases with a credit card is a lot easier as you don’t need to carry cash every time.

Interest rates: Credit card interest rates can be very high if you don’t make payments on time. This can cause your debt to grow quickly.
Expenses: Due to credit cards, some people start spending more than their capacity, due to which the debt increases.
Negative impact on credit score: If you do not make payments on time, it can harm your credit score and may cause problems in getting a loan in future.
Fees and charges: Credit card fees, late fees, cash advance fees can add up over time.
Debt Trap: If you pay only the minimum amount and do not pay the entire outstanding amount, the debt burden can increase and become very heavy for you.

If you use credit card carefully and pay on time, then it can be beneficial for you.