A credit card is a popular financial product that allows you to borrow money. It enables you to acquire funds from your bank to make your payments which could be as small as a burger to as big as air tickets for an overseas trip. You can use the credit card as long as you pay back the debt before the stipulated deadline. If you miss paying at the right time you will be charged with a percentage of interest that you owe to the bank on top of what you had borrowed. There are a lot of advantages of holding a credit card like you can make an enormous purchase and pay in small chunks. Every time you swipe your credit card, you will receive a statement with the details of the money used which can help make budgeting easier. Credit cards are a lot safer and secure to carry around than cash. However, using a credit card is only beneficial when you make sound financial choices. Its unwarranted use can lead to accumulation of debts which is a bad addition to your credit report.

How to apply for a credit card?
Applying for a credit card process today has become as simple as logging on to a social networking website to create a personal account. At the same time, it can be confusing and be intimidating if you are not sure what type of card will work for you. There are countless types of cards available each with specific usage and have different rules to follow and levies different interest rates. Though it is easy to apply, a credit card can worry you before it gets approved. So before applying you need to plan properly. Whether it’s a reward credit card, retail credit card, or secured credit card, you need to have sufficient and first-hand information when you apply for a credit card.

Know which credit card will support your needs. There are different types of cards which provide varieties of perks. If you are tired of carrying cash or going to the ATM to draw money, then a standard credit card is apt, which increase your monthly buying flexibility. Reward credit cards fetch you points during every purchase so that you can redeem your points for purchasing clothes or vacations. On the other hand, the business credit card comes with exclusive bonuses that might appeal to the entrepreneurs.

Evaluate the type of card on the basis of interest rates and the specific benefits the company offers. You should be mindful of the annual fee the company collects between $15 and $50 for the use of the card. Any credit card that you purchase will have costs and a yearly rate, that you can expect to pay over the principal amount you borrow. You will be given a grace period of 25-30 days of time to repay the amount borrowed, and the interest begins to be charged when you miss the deadline.

You can apply for credit cards offline as well as on the bank’s website.

5 reasons to purchase a credit card

• Sign up bonuses
  Sign up bonus is a sum of money or rewards offered to the customer as an incentive. Suppose you are an applicant with good credit you can get approved for a credit card that offers bonuses up to $250. You may even get significant rewards for every usage of the credit card.
• Cash back
  If you are a new customer, you may be eligible for a cash back up to 5% back on your purchase.
• Safety
  Paying with the credit card is more accessible and safe to avoid unnecessary frauds. There are high risks of fraudulent activities when you use a debit card as the money is deducted from the account instantly. It can take a span of time to reverse the effect, and the money will only be restored after the bank investigation.
• Global acceptance
  Swiping a debit card has limits, and you can use only up to the available balance in your account. In fact, you may even find it difficult or almost impossible to rent a car or book a room in a hotel, but certainly, you will have an easier time with a credit card in hand. Hotel and rental car companies prefer customers who pay with credit cards as it is convenient for them to charge for uncertain damages to the car or a room. Moreover, some foreign country merchants won’t accept a debit card even if it bears the top bank logo on it.
• Insurance
  There are quite a few benefits of holding a credit card, and one such benefit is the plethora of customer protections they offer, including rental car insurance, travel insurance, and extended product warranties.