Why Choose a Credit Card Over a Debit Card?

By the 1st half of 2019, there were around 50.3 million active credit cards in India, while the number of active debit cards was approximately 840.6 million. Both payment cards come with a unique set of features and benefits and help to make transactions easier. Regardless, in the last year, a sharp increase was noticed in the number of credit cards in circulation when compared to debit cards.

For instance, in July 2020, around 10.1 million credit cards were added to the existing number; on the other hand, there was a sharp decline of approximately 120.4 million in the number of debit cards. It is widely believed that the shift is mostly due to the user’s intrinsic nature of the credit card benefits.

Benefits of credit cards over debit cards

Here is a list of benefits of credit cards that offers it an advantage over debit cards.

Helps to improve credit report: By paying off credit card bills on time and making small transactions through the payment card, one can improve credit score significantly. This, in turn, helps to enhance his/her creditworthiness overtime effectively. 

Offers lucrative reward points and bonuses: Most credit cards like Bajaj Finserv RBL Bank SuperCard offer reward points to customers on transactions and on achieving milestones. Such points can be redeemed to enjoy perks and discounts on future transactions. 

Extends an interest-free grace period: Credit card users can use the grace period to repay their credit card dues without any additional interest. 

Instant loan facility against available unused credit limit: Credit card users can meet their immediate financial requirement by availing an instant loan against their available credit limit. Not only these you may also withdraw cash from a credit card. 

Other than these credit card benefits, they also provide exclusive benefits and allow users to choose a credit card per spending habits. Moreover, such cards come with robust security against cyber theft and scams and help to make transactions safer.