Credit card tips

Interest free EMI ensures that the total amount to be paid before the use of the EMI and the amount paid after using the EMI facility are same. There is no interest cost incurred and if there is any interest cost incurred in the scheme, then the total amount will go higher.
Credit Card EMI [...]

There are some simple steps that you can take to minimise your risk of credit card fraud:

* When you receive your credit card always check that it is sealed and that the seal is not tampered with.
* Sign on the back of your card immediately after receiving it.
* At times, monitor your credit card account, either on the Internet or through call centres.
* Subscribing to email and mobile alerts will make tracking of card usage easy for you. Wherever you use the card, always ensure that it is swiped in your presence.

How is a credit card different from a debit card? A debit card lets you use money only from your bank account.

So when should you use your debit card vis-á-vis your credit card?

A relatively-new financial product that has been introduced in the cards market is the cash card. This product offers the convenience of a debit card without the necessity of having a bank account. A person can buy a cash card off the shelf for a specific value and then use it instead of cash. The acceptability of cash cards is quite low as of now, but they provide a convenient alternative for people who are not eligible for or do not own a credit or debit card. A few popular cash cards available in the Indian market are Itz Cash, Done Cash and iCash.

Do you know the different types of credit cards? There are a lot of different classifications used by banks, but broadly credit cards fall under silver, gold and platinum categories. As you can see, gold and platinum cards are premium when compared to silver cards. Normally, gold and platinum cards carry a higher credit limit too. Naturally, they come at a cost and attract higher joining and annual fees. The eligibility criteria are also more rigid, especially in terms of income level required.

There are some factors that are vital in ensuring that the credit card is used in the right way. This requires maintaining some discipline. Keeping many of these points in mind while using and even selecting a particular credit card will greatly benefit a cardholder.
Number of cards:
There are a large number of credit card offerings in the market today. Many of these do not involve any cost for cardholders, so they are not affected financially when they select a new card. There is a need to curb the number of cards that a person holds because it will make the usage difficult. There is also the dilution of the benefits that come with the usage of multiple credit cards because reward points will get spread out. This will also mean that remembering the due dates and paying off the amounts on the credit card regularly and even monitoring them will become a very difficult task for the individual to handle. This requires a decision from cardholders about the number of credit cards that they will restrict their holdings to so that there are no administrative problems for them going forward.

There are several problems related to credit cards. Many of these can catch a person on the wrong foot and the consequences can be high in financial terms. In many cases, there are disputes arising out of these problems which can take considerable amount of time to resolve.

Misuse of cards [...]

We know banks give reward points on the basis of transactions you make on your credit card. So, how useful are these reward points anyway? Let’s take a simple example. Say over a period of one year, you spend Rs 3,00,000 on your HDFC credit card. The reward points you would earn are: