7 credit card myths you should not believe

Learn about these myths for an informed decision.
RBL Bank Credit Card
2 minutes
01 April 2024

Amid the sea of information available on credit cards, there are several myths. If you are misinformed, you could make the wrong decision and negatively influence your financial health. Here are seven common credit card myths you should stop believing.

Myth 1: Having multiple credit cards will hurt my credit score

The misconception often discourages individuals from considering multiple credit cards. In reality, having more than one credit card can be beneficial. Card issuers primarily look at your credit utilisation ratio, the credit used against the available limit on your card. Owning multiple cards can keep your credit utilisation low, potentially boosting your credit score.

Myth 2: I don't need a credit card; it is better to use cash or debit cards

While debit cards have their place, credit cards offer big perks. They build your credit history, offer reward points and emergency loans. For instance, you can get rewards like airport lounge access, 20X accelerated cash points, and more with cards like Bajaj Finserv RBL Bank Credit Cards.

Myth 3: Credit cards are for emergency use

Credit cards are not just for emergencies. They are valuable even for everyday spending. When you use your credit cards smartly for regular purchases, you can earn redeemable points on a certain amount of spends.

Myth 4: I can skip credit card payments occasionally

Missing credit card bill payments can lead to hefty penalties and high interest. This in turn, negatively impacts your credit score. So, it is important to make timely payments to keep your score intact.

Myth 5: Credit cards with rewards are not worth it

Credit cards with high rewards like the Bajaj Finserv RBL Bank Platinum Plus SuperCard can be a great way to earn cash backs, and accelerated points of 20X, which can be used for travel, shopping, easy EMIs, or getting emergency cash advances.

Myth 6: Credit card use abroad involves no fees

Using a credit card abroad could incur foreign transaction fees, usually 2-3% of the amount. A dynamic currency conversion fee might apply if you opt for home currency. Confirm international transaction fees with your card provider before travel.

Myth 7: Closing old cards helps improve credit score

Shutting an old credit card can harm your score. Credit history's length matters. A longer history is better for the score. Closing old cards shortens history, potentially not impacting your CIBIL Score. Keep old cards active, make small purchases, pay timely.

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