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In this article, we will let you know about what is a credit card? and how to choose a right credit card?

What is a Credit Card?

A credit card is a payment card with pre-approved credit limit issued by banks & financial institutions.  It allows you to borrow money within the pre-approved limit to pay for goods and services. It also gives you certain time period, typically 15 to 45 days, to repay the borrowed money to the card issuer without any charges/interest. But, if you fail to repay the borrowed money within the stipulated time then you have to pay with additional interest and charges.

How to Choose the right Credit Card?

Although a credit card is a payment device, if used properly, it can save on costs and help with life. To avoid interest on the outstanding amount, it is necessary to pay the bill on time. At the same time the credit card should be tailored to your spending habits and budget. Only then you can get the most out of your credit card. Here are some steps you can take to begin the process of choosing the right credit card.

Card eligibility

Many banks offer different types of credit cards. The benefits they provide are also different. However, each credit card has its own set of requirements and eligibility features. Those who want to get the card, first need to know the major cards they are eligible to apply for.

Cost habits

Also, be aware that not all cards are suitable for one person. The credit card you choose and its offers should be in line with your spending habits. For example, for those who do not own a car or bike, a credit card that offers petrol discount points is useless.


Credit card features should be budget friendly. If a few cards are shopping for more than Rs 20,000, the credit card which offers a 10 percent cashback offer will benefit shoppers for this amount per month. However, a cashback card for Rs 40,000 may not be suitable.

Credit Card Limit

The amount of pre-approved limit for the card will be given according to your income and the credit score. Although this varies from bank to bank, you should choose a card that offers a higher credit level. With this, it is possible to keep the card usage rate within a favorable ratio.


Also note the annual fees for a credit card. Some cards offer a discount on the annual cost. In addition to the regular cashback offer, many cards also offer additional offers; These should also be considered.

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