HOW TO USE CREDIT CARD SMARTLY?

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Today most of the people love to use a credit card due to development in banking systems and transformations in daily requirements. People, in general, have been able to afford it. Even common people are subscribing to the credit card in countries like Nepal.

What is a credit card?

A credit card is a fiber plastic material with a chip embedded within letting you an entree and use the credit limit. Virtually it works like a loan, but instead, you get your money in credit that you will use through card before paying back. A credit card is a facility offered by a bank to its privileged customers as per the trust built with mutual relationships.

Credit card in the context of Nepal

By 2020 mid-Feb alone, the credit card users have increased by 19.25% in Nepal by reaching the number to 146,856 according to oversight-report on payment systems by Nepal Rashtra Bank (Source: www.nrb.org.np). The number noticeably will go up in years ahead.

Users can easily use credit cards to purchase products and services in POS terminals and ATMs within the country and India as well.

How to get a credit card in Nepal           

As said above, the credit card is something offered to a customer as a privileged user. There are certain criteria and the most important being an account associated with a bank. Afterward, with certain application formalities with form fill up and documentation, the bank reviews the details and provides the card.

The basic criteria to get a credit card in Nepal are:

  1. Personal Details.
  2. Gross monthly income details.
  3. Income source details.
  4. Service tenure.

Important things to consider

To get a credit card, you must be at least 18 years of age. There might be limitations on the minimum monthly salary. Usually, most of the banks start with a minimum monthly salary of NPR 15000/-  In the context of businesses, the annual income must be NPR 150,000 or above.

Advantages of credit card:

  1. Many of the credit cards will give you rewards and you can get back 1% or more than that of the money you spend.
  2. If you use responsibly, you can then build your credit, which will help you later on.
  3. You can also make a large purchase now and then pay later in a small amount over time.
  4. It also boosts your credit rating, if you had an inadequate limit of the credit report, you could get the offer to improve your financial situation.

But with all the good things and developments, there are obvious associated drawbacks. A credit card cannot remain apart and require an intense level of smartness basically for all the safety reasons. Here we give you some ideas on how to use credit cards smartly.

The “smart” we are talking about not only incorporates the safety requirements but also includes the saving side. Practicing how to use a credit card smartly is a big step towards banking security and as a part of the community, you must be starting to do so now.

Disadvantages of the credit card

  1. The interest can be small debt but sometimes can become larger.
  2. If you miss your payment, then your credit card can sink the credit score that you have.

If you wish to make most of the transaction with a credit card, the suggestion below will help you.

  • Pay your credit card bill on time

The timely approach of credit card payment is a discipline.  If you have the unpaid sums and card bills, they can distress your credit score destructively. You need to understand the credit card imposes a high-interest rate if you have outstanding balances. 

If you miss paying the overdue amount at the agreed time, then make certain you have satisfactory finance to pay any of the incomplete bills. It is advisable to pay the outstanding amount on time since you will qualify for higher credit if you follow the rules given. 

  • Avoid using your card at ATM

The credit card also allows you to withdraw money from ATMs. But, you need to avoid using it completely. Understand that ATM withdrawal charges are high.

  • Take your time to understand rewards

The credit card will give you reward points for the specific kinds of spending. Some of the people receive a particular gift on their menus. Therefore, some of the gifts may also be provided as the joining benefits to you as a user. Each card owner must recognize credit limits as they will stretch him/her the liberty to pay fast. 

  • Always keep your credit card details secured

You need to understand scammers are everywhere and they defraud credit card users. Therefore, your card should be open to only you, not another person. If you share with the third party, then fraudulent practice may happen to your credit card. Also, don't swipe your card in any place except POS machine and ATMs, if you do so, the insecure swipe could make it extremely vulnerable and easily misused by others.

  • Pay close attention to joining and renewable fees

Credit cards often have joining and renewal fees, if you don't know. But some cards have no renewable cost. Therefore, if you are looking for a credit card, pay attention to the fee structure. Make sure to check reversal benefits to save on your annual fees.

Final Note

A credit card is always fun if you are a frequent out-goer and do not like getting loaded with cash. But at the same time, you cannot ignore the accountability you carry throughout. Safe banking is everyone’s responsibility and your smartness basically for the use of credit cards mostly determines the intensity.  

NIC Asia offers facilities with the best credit card in Nepal with comprehensive Visa card features. Feel free to consult us and learn how to make a credit card easily.

You can apply for a credit card online anytime. Share the post and let your circle know the good practices towards using a credit card smartly. Keep the community safe.

Thank you for reading. Please share this article if you liked it.

NIC Asia Bank
Helpdesk - NIC Asia Bank

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