To choose the right credit card, one should understand their needs and list options. This means checking the eligibility criteria and documents required to apply, the features that are offered, the incentives such as reward points and cashback, the fees that apply, the credit limit you require and more.
Factors to consider when choosing a credit card
Here are a few things to look out for before you choose a credit card.
1. Eligibility criteria
Find out the eligibility criteria and documents required to apply for the credit card you want.
2. Card features
Choose a credit card which has features like extended interest-free period, ease of repayment, security, online application and more.
See what discounts, cashbacks, rewards, loyalty points or special privileges are being offered and pick a card that has incentives relevant to you and your needs.
4. Fees and charges
The benefits you get shouldn’t be at the cost of high annual fees and charges. Look for a credit card with an affordable fee.
Look for the card’s special highlight. For instance, the Bajaj Finserv RBL Bank Credit Card gives you the option of interest free ATM cash withdrawal facility.
6. Credit limit
Calculate your average monthly spends and your monthly income. Then choose a credit card which gives you a high credit limit and flexibility.
7. Application procedure
Choose a credit card that has minimum processing time and an easy application process.
8. CIBIL score required
Some issuers require you to have a certain CIBIL score to qualify. Check if you meet these requirements. Also, keep in mind that it is a myth that credit cards can ruin your credit score. When you repay your dues in full and on time, credit cards can have a positive impact on your CIBIL score.
Tips for choosing between different types of credit cards
Choosing the right credit card involves assessing your financial habits, goals, and lifestyle. There are various types of credit cards tailored to different needs. If you frequently travel, consider a travel rewards card for miles and perks. Cashback cards are ideal for those who prefer earning money on everyday purchases. Individuals with existing credit card debt may benefit from balance transfer cards with low or zero interest rates. For building or rebuilding credit, secured or student credit cards are suitable options. Additionally, premium cards offer exclusive benefits for high spenders. Carefully evaluate your spending patterns and financial objectives to select a credit card that aligns with your unique requirements and enhances your overall financial well-being.
Credit cards serve various purposes, from accumulating travel rewards and earning cash back to segregating business expenses and transferring debt to a more favourable interest rate. If you are contemplating the selection of a credit card, reflect on the nature of purchases you intend to make with the card. Additionally, assess your credit score, explore ongoing welcome bonuses, and evaluate the advantages and perks associated with any prospective card. Making a thoughtful consideration of these factors will assist you in making an informed decision when choosing the most suitable credit card for your financial needs.
Additional Read: How to use a credit card