Credit card || Merit of credit card || Demerit of credit card || E-commerce || B.com || easy explane
What is the Concept of Credit Card?
A credit card is a payment card that allows the cardholder to make purchases without the need for immediate payment. Credit cards are issued by financial institutions such as banks and credit unions and can be used to purchase goods, services, and cash advances. Credit cards offer advantages such as convenience and the ability to build credit, but also come with risks such as the potential for debt.
Credit cards are widely accepted as a payment method and are accepted at most retail locations, online merchants, and even for international purchases. Credit cards also offer additional services such as rewards programs, travel insurance, and access to cash advances.
The concept of credit card is based on the idea of revolving credit, which allows the cardholder to borrow an amount of money up to a predetermined limit and pay it back over time. The cardholder is then charged interest on the amount of money they have borrowed. Revolving credit is different from installment credit, which requires the cardholder to pay off the entire amount borrowed in fixed payments over a period of time.
Credit cards are typically issued by financial institutions such as banks and credit unions. The card issuer will evaluate the cardholder’s creditworthiness and establish a credit limit based on their credit rating. A credit limit is the maximum amount of money that can be borrowed with the card. The cardholder is responsible for making timely payments and will be charged interest if the balance is not paid off in full each month.
Credit cards also come with a variety of fees, including annual fees, late fees, over-the-limit fees, and cash advance fees. Most credit cards also offer additional features such as rewards programs, travel insurance, and access to cash advances.
Using a credit card can help to build credit, as long as the cardholder makes timely payments and stays within their credit limit. Making timely payments can help to improve the cardholder’s credit score, which can help them to qualify for better interest rates on future loans.
However, it is important to be aware of the risks associated with credit cards. Borrowing more than you can afford to pay back can lead to debt, and the interest rates on unpaid balances can add up quickly. It is important to be aware of the terms and conditions of your card and to use your card responsibly.
Key Points:
• A credit card is a payment card that allows the cardholder to make purchases without the need for immediate payment.
• Credit cards are issued by financial institutions such as banks and credit unions and can be used to purchase goods, services, and cash advances.
• Credit cards offer advantages such as convenience and the ability to build credit, but also come with risks such as the potential for debt.
• Credit cards are based on the idea of revolving credit, which allows the cardholder to borrow an amount of money up to a predetermined limit and pay it back over time.
• Credit cards are typically issued by financial institutions such as banks and credit unions and come with a variety of fees.
• Using a credit card can help to build credit, as long as the cardholder makes timely payments and stays within their credit limit.
• It is important to be aware of the risks associated with credit cards and to use your card responsibly.
People Also Ask:
Q. Does a credit card build credit?
A. Yes, using a credit card responsibly can help to build credit, as long as the cardholder makes timely payments and stays within their credit limit.
Q. How do I get a credit card?
A. Credit cards are typically issued by financial institutions such as banks and credit unions. The card issuer will evaluate the cardholder’s creditworthiness and establish a credit limit based on their credit rating.
Q. What are the risks of using a credit card?
A. Borrowing more than you can afford to pay back can lead to debt, and the interest rates on unpaid balances can add up quickly. It is important to be aware of the terms and conditions of your card and to use your card responsibly.
What is the concept of credit card? – Best Deal Right Now?
In this video topics covered:
Meaning of credit card.
Merit of credit card.
Demerit of credit card.
Playlist E-commerce 👇
https://youtube.com/playlist?list=PLGLdMDW6Sydny3oA1HNyzKxH0X2_R1emm
Thanks for watching 😊
Keep supporting 👍🙏