Your Guide to Using a Credit Card to Fulfil your Lifestyle Needs

The demonetisation initiative has indeed enhanced the use of plastic money by Indians. As per the data of Reserve Bank of India, there has been a 50% rise in the quantum of credit card circulation from 2016 till 2018. There has been an increase in credit card transactions as well. In April 2017, the number of credit card transactions stood at 286 million, whereas, by April 2018, it has reached the 333.77 million mark.

Using a Credit Card

Financial institutions continue to layout extensive credit card benefits to attract new clientele. Overall, the market sentiment is credit-friendly towards the fulfilment of various obligations via instant credit. You can even avail better reward points as well as discounts and cash backs. Individuals today do not hesitate to utilise multiple credit cards to avail lucrative deals. Thus, a credit card can be considered as your trump card to access the lifestyle you prefer at a subsidised price.

How Many Credit Cards One Must Possess?

There is no ideal maximum number of credit cards you can own. It depends on your eligibility to own, and your requirements. It is just as essential to ascertain whether you will be able to manage expenses across multiple cards simultaneously.

Things to Remember while Owning Multiple Cards

It is not advisable to avail several cards at once, but it is wise to avail one first and use it as per your needs. Of course, if you find that just one card is unable to meet all your essential needs, and then get another card that will be able to do it. Thus, you can increase the number of cards one by one, and it won’t create an additional burden on your finances, as you will avail them after scrutinising the financial needs well.

There is one more consideration in terms of availing a credit card. Each time you apply for a credit card, the financial institution initiates an enquiry into your credit history. This is referred to as a “hard enquiry,” and it tends to diminish the credit score by a fraction. So, remember this aspect while you are going for multiple cards. You must go ahead with a well-planned strategy so that increasing the number of credit card won’t have any damaging effect on your credit ratings. The main factor would be repaid on time.

How to Impart a Positive Effect on Credit Score with Multiple Credit Cards?

If you use your credit card frequently and often hit your spending limit, then you end up having high Credit Utilisation Ratio (CUR). High weight is assigned to the CUR by credit rating agencies, so higher CUR might lead to a low credit score. If you possess multiple credit cards and you manage to use them judiciously, then it will leave a positive impact on the credit rating. Responsible financial usage of the card to increase CIBIL score over time is one of the intrinsic credit cards benefits a modern credit card user should be aware of. Ideally, the CUR must not be higher than 50% of the preset limit.

If you want to increase your credit limit, then you can request the provider of the card to adjust the threshold. Reputed financial institutions offer this option with their credit cards. NBFCs offer such features too as well as multiple complementary add-on packages as mentioned before.

NBFCs also brings you pre-approved offers on credit cards and numerous other financial products including personal loans, home loans, and business loans. These offers simplify the process of availing your loan and also help save your time. Check your pre-approved offer by sharing a few elementary details.

So, apply for credit card and enjoy a host of benefits to upgrading your lifestyle.  You need to be a bit practical and keep a careful eye on the usages and the number of expenses incurred, and the rest is pleasure unlimited.