Credit Card Advantages And Disadvantages

Credit cards have become a part of our daily lives, everywhere we go, whenever we shop, we use our credit cards. And why not, as the convenience of using a credit card is much higher than cash, and the rewards we get after payment with a credit card have no other match. However, along with the benefits, credit cards also come with some disadvantages that one must be aware of.

Credit card advantages and disadvantages

In this article, we will talk about the advantages and disadvantages of using a credit card. 



  • Reward rate: Every credit card comes with a reward rate, where for every transaction you do with a credit card, you will get reward points or cash back. These rewards help you to save on your transaction and you can redeem them for vouchers, gift cards, or against the credit card’s statement balance.
  • Easy to use: Credit cards are very easy to use and are a convenient way of payment. Paying with cash involves very high risk and is very difficult to handle. Whereas a credit card is easy to carry and offers security to the cardholder.
  • Building credit score: If you use your credit cards wisely, they would help you to build your credit score. A credit score is a very crucial component of using a credit card. If you settle your bills before the due date and use it under the credit limit, then it would leave a positive impact on your credit score.
  • Emergency access: In case of an emergency, credit cards are the most beneficial option as they provide you easy access to funds. Moreover, credit cards provide you with the facility of converting any transaction into EMIs if you are unable to pay lumpsum.
  • Add-on card facility: If you are holding any credit card, then you can share the same card with your family members with the add-on card facility. The add-on cards are issued against the primary card and offer the same benefits to the cardholders.


  • Bad addiction: As credit cards provide you a huge credit limit, the cardholder may get addicted to using a credit card for every other spending. And finally, the person ends up using the credit card for purchases that were not necessary.
  • Debt trap: If you default on any credit card statement, the card charges heavy finance charges and a late payment fee on the outstanding amount. Ultimately, the burden keeps on Increasing and the cardholder may fall into a debt trap.
  • Heavy impact on Credit score: If you are unable to settle your debts on the credit card, the card issuer may close down your account. The end result will leave a huge impact on your credit score.
  • Frauds: Credit cards can be tracked and anyone can gain access to your credit card if you misplace the card information or disclose it to anyone.

Additional Reading: Tips For Paying Off Credit Card Debt

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