Credit Card or Debit Card: Which One Makes Your Shopping Easy?

Total amount spent via credit cards reached Rs. 6 Lakh Crore in the financial year 2018-2019, which is a 30% surge from the previous year. This fleeting change along with the latest credit card trends assures a promising future for credit cards even if it lags as compared to the number of debit cards. 
Usage of credit card and debit card both are popular methods of shopping. And, with India planning a shift towards a cashless economy, more people prefer the digital mode of transaction. 
 
Benefits of choosing credit cards as your preferred shopping mode:
  • Earn rewards and points- For each spend through your credit card, reward points are added to your account based on the amount of purchase. You can redeem these points when it reaches a dedicated threshold in the purchase of a product. Some companies avail you with a unique list of lucrative items that can be purchased by redeeming the points. Also, monthly or quarterly offers to earn more reward points are introduced by companies to enhance the consumer shopping experience. There are several things to do with your credit card reward points.
  • Earn cashback – The concept of cashbacks has gained much popularity in shopping online and offline. Some cards offer from 1% to 6% cashbacks on dedicated purchases.
  • Sign up bonus – Few credit cards provide high reward points as sign-up bonuses, unlike debit cards that come with zero welcome bonuses.
  • Security- Security is a major concern while shopping via credit card and debit card. For unwanted instances like loss and theft of a card, debit cards put you at instant risk. Fraudulent transactions carried out by a scammer will put you in a potential risk affecting your savings account balance. It takes time to reverse those suspicious transactions and solve the matter. However, with credit cards, a simple complain to the financial institutions will initiate a chargeback. Furthermore, you also get to enjoy several security features that protect you as a consumer. Credit cards like the Bajaj Finserv RBL Bank SuperCard offer security features like ‘In-hand security’ and ‘Zero-fraud liability cover’, which protect you from cybercrimes. They also provide pre-approved offers, which make availing credit cards less time-consuming and straightforward. These offers are available on several financial products like personal loans, business loans, home loans, etc. Enter the name and contact number to check your pre-approved offer in seconds.
  • Grace period – With debit cards, you can shop from the available funds in your account and have to pay immediately. On the other hand a credit card enables you to pay via credit from the card issuer. The payment has to be met within a month, which is your bill generation date. Credit card companies provide additional 15-20 days for consumers to pay the bill. This entire time is known as the grace period.
  • Universal acceptance – Some purchases are preferred with credit cards like hotel stays, car rentals etc. as it is convenient for them to charge in case of any property damage or so. Making a payment with debit cards in such cases can be difficult to manage. Also, a credit card is accepted worldwide and is preferred for international purchases as a merchant may deny payment through a recognized debit card.
  • Chance to build a good credit history – Credit cards allow people with no or low credit history to use a credit card wisely and improve their credit score. Make sure you know how to use a credit card to improve your credit score. When to use a debit card?
  1. One can make use of the debit card for recharges, daily purchases, etc. that will help you manage your monthly budget with ease.
  2. To avoid overspending issues, you can make use of debit card over a credit card.

 

Both credit card and debit card has its fair share of advantages, but your spending habits along with where you spend using a particular kind of card is an important decision to make. Weigh your options about the benefits you can gain from shopping through debit card or credit card and make decisions that can improve your financial standing. 

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