Credit Cards and Credit Scores.............. now is this a boon or bane

Hello Ravi, Of course Credit Cards are boon only, provided it is used properly and planned manner. further credit cards will help you in emergency situation and you dont need to borrow from somebody. As long as you repay promptly no probblem will be their. Default will be major problem for which cardholders should avoid.

K Rajagopalan.

THANK YOU SUGANTHI FOR YOUR INVITATION.

CREDIT CARDS ARE LIKE A DOUBLE EDGED KNIFE,WHICH IF NOT HANDLED PROPERLY WILL PUSH YOU TO ALL KINDS OF DIFFICULTIES.THEY ARE A BOON AS LONG AS ONE   USES IT WITHIN HIS MANAGEABLE LIMITS.BUT HERE COMES THE PROBLEM.INDIVIDUAL`S SELF ASSESSMENT OF THIS MANAGEABLE LIMIT ERRS IN MANY CASES.ONE REMEMBERS  THE ADAGE, CATCHING THE TAIL OF A TIGER.CREDIT CARDS HAVE DONE MORE HARM TO INUMERABLE PEOPLE THAN GOOD TO A FEW.

Credit cards are very useful to even middle class families. They can afford an item immediately if they wish which is not possible otherwise and the dream of purchase fades away. Credit card increases market activity, which may be helpful for overall growth.

Hi Suganthi,

As your rightly pointed out that the credit cards are boon to the people if they are using properly. Moreover many people not having the through usage of credit card that is the reason of having a doubt whether it is boon or bane.

Here some of the extraordinary features of Credit Card:

If the credit cards are used for the purchase for hot drinks in the restuarant/ bars and the aservice tax levied to us on the basis of percentage by ministry of finance but now after the finance bill of 2010 says that these are to be accounted as entertiament income and such income are to retrieved to the government by the restuarant. bars and not by the public. if any of them are praticing so, it is not correct.

Many people usetheir card to purchase Gold/Silver/Platimun which are said to most luxurious one on which the people are purchasing today and making the payment after 30 days since the date when you are purchasing at the same rate you need to make the payment but in Devloped countries like France, Switzerland are banks used to charge the customers on the date while making the payement which is undoubtly a higher amount and for which the customer will be awarding 1$  for every 500$ but comperatively in india most of the awarding Re.1 for every Rs.100 purchase made. Please cleraly understand in india for every purchase points are being awarded but in other developed countries points are being awarded on every payement.

Hence In India it is a boon for the people for prompt payement, As it is a bane to the banks. If not it is vice versa.

I agree with the argument and it helps to have money to meet the urgent requirement. The repayment schedule should be strictly followed otherwise the card holders will land in problem. One should not forget the annual compound interest rate is app. 44%.Knowingly people are trapped into this vicious circle, especially the salaried class people. For them there is no other go. Having credit cards tempting the card holder to use very often for luxury purposes without any planning and finally they are trapped into the problems when it comes to make the payments on due dates from their hard earned salaries. Hence the credit cards indirectly induce to swipe and increase the liability.In my opinion the salaried class having credit cards should judiciously use. But credit cards are good for business class people who will be in a position to use it in a better way since their repaying capacity is very good.

However, the charm for credit cards have come down now a days.

Thanks for the referral Ms.Suganthi Srinivasan Ji.

It is still beneficial. Conditions apply.

It is a good idea as you can go about our planned spending style without carrying cash. It is as good as you use .

Yes it is a boon of-course, and ravi what do u exactly mean by lost its shine. Credit cards are not show-pieces and neither should it be used to flaunt of ones riches. infact it should be used responsibly to avoid paying off unnecessary interests. If one thinks of that thing as cool and starts showing off, he will be inviting trouble.

its a boon

Credit Card is usefull as long as it is used properly. The davantages are:

1. It is a Cashless facility
2. You get Interest free credit for all types of purchase transactions for a period of 47 to 52 days
3. In some cards you get rwards points, which can be converted to gifts of your choice among the gifts offered and points avaialbe to redeem
4. Some cards offer up to 5% cash back facility for usinf the crdit card.
5. Some cards tie up with shops to offer up to 20% discounts on purchse/ dining/accomodation
6. Most Cards are insured against loss and misuse of cards by others and is thus better than cash
7. Some cards offer accident insurance
8. For additional annual payments some cards offer, executive health checkup, holiday package etc
9. SOme cards have tie up with facilities which you can use at Airports
10. Some Banks offer to covert balance on cards in to short term loans with low interst rates of 12-14% per year instead of normal 3-3-5% per month interest.

However you get lots of mails and unwnated calls from telemarketing people and other which you cannot stop even if you have registered under DND. If you dont pay in time you end up paying havvy panelty. If draw cash using thecard you end up paying a big commission. You tend to buy more even if you dont want an item and even if you dont have the capacity to buy and pay. If you are desciplined in life cards really are usefull to you

Use the cards judiciously and you will enjoy

Credit Card is definitely beneficial so long as one uses it judiciously.  It provides you with the convenience of not carrying cash and saves from the risk of loosing it, and makes the cardholder enjoy a free credit for about 45 days.  If the payment on the card is not made by the due date, it becomes a monster and shows its true size and power at the time the cardholder seeks further facilities from a bank.

Use it judiciously, it is indeed a friend in need.