In today’s modern day economy, a credit card is convenient financial product that can be used for everyday purchases. It also places considerable purchasing power into the hands of the holder, and allows individuals to pay for things they cannot instantly purchase because the funds for these items are not always immediately at their disposal, but may do so in the future, through regular payments to their banks.
Credit cards are quite convenient, as they allow individuals to purchase necessary items without paying much attention to the price, as the accumulated credit will be paid back later in time, hence it exponentially increases the purchasing power of individuals, and boosts the economy in the most conceivable short-term, with a reliable time frame to redeem the funds.
Beyond convenience, other advantages of credit cards include providing cardholders with the opportunity to build credit, earn rewards and cash back, and protect against credit card fraud.
Defining credit cards
Also known as plastic money, credit cards allow the owner to borrow money from the issuer (bank), to a certain limit every month, at any given point of time. The borrower has the option to repay the borrowed amount in instalments, or in lump sum, before the due date.
Eligibility criteria for credit cards
Usually, the eligibility criteria for credit cards differ from bank to bank. Some requirements such as the minimum income level etc., can also differ for different cards offered by the same bank. However, some eligibility criteria remain the same for all banks and all cards. Given below are some such requirements:
- The individual should be at least 18 years of age
- The individual should meet the minimum income criteria of the issuing bank
- The individual should also be able to produce all necessary documents needed for identification
Credit cards worldwide
Here, we are going to list the five easiest ways to apply for credit cards around the world:
- US
It is incredibly easy to apply for a credit card in the US . All an individual living in the US is just required to have is a Social Security Number (SSN), and a permanent address, in order to be approved for a credit card by issuers. Some banks presently even waive the prerequisite SSN in order to issue a credit card.
- UK
The UK is an additional economic hornet’s nest, which witnesses countless individuals issuing credit cards. Applying for a credit card in the UK depends primarily on one’s credit score and annual income, with some credit cards demanding greater annual income than others. Moreover, there are further various requirements which are bank-specific pertaining to the individual’s bank through which the application for the credit card will be conducted.
- Canada
As with the US, likewise, it is again exceptionally simple to issue a credit card in Canada. However, initially, the credit card issued at first has a high interest rate, or a meagre spending allowance; but, if the individual uses the card responsibly, over time they will build their credit score, hence easily qualifying them for an unsecured card.
- Australia
Yet again, Australia is a terrific spot to get a credit card. To be eligible for a credit card in Australia one merely needs to fulfil the minimum income, and the residential criteria. A positive credit history also tips the balance to one’s favour when approving a credit card, hence it is advisable to maintain a good credit history.
- Malaysia
Malaysia is a leading destination for businesses and corporations. Ergo, it is especially vital to become familiar with the effortless measures to issue a credit card in Malaysia.To be eligible for a credit card, one simply needs to have a minimum income sum as required by the bank being applied to, as well as an employment history in order to assure the bank that the individual is capable of paying the sum back to the band, and is financially secure. Correspondingly, improving one’s credit rating will also augment one’s prospects of receiving a credit card.
Conclusion
If you are prudent with your spending habits, credit cards offer a plethora of benefits which can be very rewarding for you.
A credit card helps you shop and entertain hassle-free, as you don’t have to worry about carrying cash. This also ensures money safety. Online transactions can also be made with your credit card.
Whether there is a medical emergency or any other kind of unexpected cash requirement, credit cards come to the rescue by providing credit under such circumstances.
With credit cards you can spend more than you actually own. It raises your purchasing power. Now you don’t have to compromise on your shopping list due to shortage of cash.
All credit cards offer you interest-free periods, where no interest will be charged if you repay the credit that you have taken within the due date.
Most of the banks provide a grace period to their customers within which they can pay their outstanding equated monthly instalments without any extra interest charges. Generally, this grace period is 20 days starting from the day of the bill.
Nearly all credit cards offer reward points on the amount you spend through the credit card. You can use these reward points to get discounts on shopping, dining, and some credit cards also return cash back on your fuel expenses. You can later redeem your reward points to enjoy benefits. Some special credit cards offer extra reward points with special types of transactions such as flight booking, dining, online shopping, etc.
One of the main benefits of owning a credit card is that you can build a credit history, in the event you do not own any other type of loan. And, by repaying all your credit card dues in time, you can build a good credit score, which will help you in getting increased credit in the future.
Banks prefer giving loans to individuals who have a good credit history. At times they may reject your loan application if you don’t have a positive credit history. Credit cards are one of the chief ways of building a credit track record.
Shopping through your credit card helps you maintain an automatic transactions’ track record. You can ask for a credit card monthly statement to be conscious of where you spent the money in the previous months, and plan your future expenses accordingly.
Owning a credit card is an immense convenience, and provides you with a superior spending power. A card holder essentially becomes capable of purchasing whatever they need. Credit cards are also a powerful asset in emergency situations.
Credit powers and loans are the roots of capitalism, and credit cards have presently become an integral unit of the system, as well as the daily lives of people.
