Credit Card – Advantages and Disadvantage of Credit Card

Filed in Social Media by on June 24, 2019 0 Comments

Credit Card – Advantages and Disadvantage

Credit card entails a payment card that is given to users to help the cardholder purchase and pay a seller for  services rendered or goods bought which is done based on the card holders promise to the issuer to pay for the amount of goods bought and other charges.


Here, the bank been the card issuer generates a revolving account for the card owner and grants a line of credit for him of which the card owner can have access (borrow) money for payment to a merchant.

It is paramount to note that a credit card is different from a charge card, as it demands the balance to be repaid in total every month.

Thus, in distinction,it enable its users build a long-lasting balance of debt, as interest is being charged.

Advantages of credit card

A. Expediency – It is easy to make purchases quicker with the card than cash or checks.  Below are the activities credit cards are easy for:

  • Online Shopping where you charge it to your credit card, and don’t have to send a check.
  • It is convenient for vacations, lets say you are going on a vacation in foreign countries, and you don’t have to carry a lot of cash or use checks to pay for expenditures.

B. Safety. It is unsafe to take lot of cash at hand but with a credit card it is safer especially on holidays.

C. Urgent (Unplanned) payments – In case of emergency financial emergency happens medical troubles, or unforeseen tax payments you can pay for it with a credit card. You can then handle unexpected expenses with a monthly payment.

D. Credit rating. Once you pay off the amount you owe on your card each month, it will help increase your credit rating.

E. Discounts. Most stores offer discounts and other rewards when using a credit card. Here, some cards offer cash back rewards.


  • High interest – A lot of credit cards charge a very high interest rate, it can be expensive if you do not pay off the full balance per month through your paying the high interest rate, it makes your purchase on the credit card much more costly.
  • Skip payments – You are often charged for late fees if you don’t make a payment, or miss a payment for over thirty days, and your interest is increased this impact your credit score negatively and give lenders a poor view of your monetary power.
  • Credit Score Decrease. Once you run up high-level balances on your credit cards and do not pay them down every month, your credit score decrease, and often your credit balances on your cards will be reduced, which will lower your credit score continuously.
  • Don’t Have purchase decisions –  at times, constant use of the card can make you buy something you shouldn’t spend your money on.

Once you have an idea on how this things runs with the advantages and disadvantages will aid you make better choice on the usage as well make you feel convinced.

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