What is credit card? purpose of credit card.

A credit card is an equal piece of plastic or metal issued by a bank or banking company that allows cardholders to credit cash to pay for goods and services at retailers who accept credit cards.

Cardholders must refund the borrowed amounts, plus any related interest, as well as any like for charges, in whole or over time by the payment due. A credit card type is the Chase Freedom Reserve. (See our Blue Cash Limited credit card review for a thorough knowledge of the many other components of a credit or debit card.)

Line of credit (LOC).

In addition to regular credit line, creditors may be issued an extra cash line of credit (LOC), which allows them to loan money in the form of advance payment received by bank tellers, ATMs, or credit card utility checks.

 When compared to transactions that access the primary credit line, such cash advances often have different terms, such as no grace period and higher interest rates. Borrowing restrictions are typically pre-set by issuers depending on an individual's credit score.

The great majority of companies take cards, which represent one of the most popular online services for acquiring consumer goods and services.

Understanding of Credit Cards.

Credit cards sometimes have bigger annual percentage rates than other types of customer financing (APR). Although if earlier underpaid balances from a prior month were passed forward, so in that case no notice is approved for original charges, loan repayments on any underpaid balances made to pay to the card are usually noted approximately one month after a customer buys (except in cases where a 0% APR origination fee is in place for an original duration of time since initial registration).

 Types of Credit Card

Banks, credit unions, and other financial organizations issue the majority of major credit cards, such as Visa, MasterCard, Discover, and American Express. Many credit cards entice customers with perks like airline miles, hotel room rentals, gift certificates to big shops, and cash back on purchases. Credit cards that offer gift are sometimes send to prizes as credit cards.


Personal loan cards are a type of credit account that needs the borrower to make a full deposit. These cards provide limited credit lines equal to the security deposits, which are frequently repaid once users demonstrate responsible card usage over time. A man with zero/less credit past days typically apply for these cards.


Advantages of using a credit card

·        Possibility of improving credit.

·        Earn cash back or miles points as a reward.

·        Anti-fraud protection for credit cards.

·        Credit score info is accessible for free.

·        No costs for global transactions.

·        Purchase power has increased.

·        No connection to a checking or savings account.

·        Giving a standby rental vehicle or a hotel stay.

·        You can open without taking an immense loan.

·        Some cards have perks, such as insurance on auto rentals or extended warranties on certain purchases.

·        You can use them almost anywhere in the world, eliminating the need to carry large sums of cash when traveling or buy travelers checks.


 Disadvantages of credit card

·        Purchasing up to the credit limit, and pay in installments.

·         Interest rates are usurious.

·        Fees are ridiculous. If you not giving safety there card, can trap you into paying the same fees month after month.

·        Minimum payments barely make the balance go down. Kind of like mortgage amortization.

·        You can ruin your credit if you're not a careful spender. Cash advances way too easy to get, with high fees.