Are you thinking about applying for a credit card? If you’re still undecided about whether or not a credit card is for you, it’s worth considering the benefits of owning one.
Thousands of South Africans use credit cards each day, benefiting from the financial flexibility that credit cards offer them. When used responsibly, credit cards can be a valuable resource and an efficient money management tool, and could enable you to purchase goods and services you’d otherwise be unable to.
Read on to discover the primary benefits of owning a credit card, or learn more about the types of credit cards available by making use of an online credit card comparison tool.
• Credit cards enable you to purchase goods and services now, and repay them later
There are many times in life where you may need to make a significant purchase that you’re unable to pay for in a single transaction. A burst radiator in your car, a leaking roof in your home or an unexpected medical bill could cost you thousands of rands – money that you don’t immediately have access to. If you own a credit card, you can settle the bill (choosing either the “budget” or “straight” payment option) and then settle your outstanding credit card balance at a pace that suits you. In this regard, credit cards can be unbelievably valuable in an emergency.
• It’s safer to carry a credit card than cash
It’s always been safer to carry a credit card than it is to carry cash. Today, however, it’s safer than ever before to carry a credit card, thanks to advanced Chip and PIN security. If you lose money, you can’t replace it, but if you lose your credit card, you can cancel it and apply for a new one. Chip and PIN technology requires cardholders to enter their PIN number in order to validate each transaction, and thus would-be fraudsters are unable to use Chip and PIN-enabled credit cards they happen to find.
• You can buy on credit without having to pay interest
Many credit cards offer interest-free periods (usually this is 55 days), and you won’t be charged any interest if you settle your outstanding balance during this period. That means that you could enjoy all the advantages of credit, without the interest costs that are usually associated with it. Interest-free periods are one of the most valuable benefits of credit cards, and when used properly, could transform your credit card into a valuable financial tool.
• Credit cards help you to establish a credit history
For individuals who have never made use of credit, it’s often difficult to qualify for a car or home loan. It may sound strange, but in order to get credit, you first need to prove that you can manage debt. If you don’t have a credit history, it’s difficult for lenders to establish your creditworthiness – and thus, they may be reluctant to give you a loan. Owning a credit card, and using it wisely, will help you to build up credit record and prove that you’re a responsible credit user. For this reason, it’s important to settle outstanding balances promptly.
• Credit cards are useful when travelling
Because most credit cards are accepted globally, they can usually be used anywhere in the world. Thus, if you have a credit card, you won’t have to worry with foreign currency or travellers cheques, which is particularly useful in areas where there aren’t a lot of banks. Moreover, many credit cards offer free travel insurance when you use them to purchase your air tickets. And of course, it’s safer and far more convenient to travel with credit cards than it is to travel with cash or travellers cheques.
Find and compare the credit cards online to discover the card that best matches your spending style and your budget, and then apply online to find out whether you qualify.
Plastiq is an online credit card comparison site that helps you to find and compare South African credit cards. You can also apply for the credit card of your choice via the website.
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