5 avoidable mistakes for all credit card users

Mumbai: As per the official reports, there are around 350 million debit cards in circulation in India as compared to only 19 million credit cards. Even though credit cards offer a range of rewards and benefits to their respective card holders, responsible use of credit card can help you escape from financial havocs.

Here are some important things to keep in mind if you are a credit card holder:

Avoid loaning your credit card:

It might seem like a good deed done by you by loaning your credit card. But when you loan your credit card, always remember the fact that you have no control over the purchases they make. If the person who borrowed your credit card doesn’t pay back the bills, you might face an unwanted financial debt.  Never loan your credit card unless you're prepared to pay for all the purchases they make.

Exceeding credit limits: 

Your card issuer will urge you to increase your credit limit from time to time. Exceeding your credit limit, your card issuer will charge you Rs. 500 every instance or 2.5 per cent of the over limit amount. While your card issuer earns money, your credit score is negatively impacted. A bad credit score can mark your possibility of getting all future loans

Don’t ignore your billing statement:

Your billing statement is often the first tip off to any fraudulent activity on your account.  By ignoring your credit card billing statement, you might miss your payment due date. This might also result in an ignorance towards numerous changes  in your credit card terms and conditions. Checking your billing statement will help you to ensure that the charges are accurate.

Ignorance towards your credit card terms won’t let you know credit card costs:

Ignoring your credit card terms will not help you in being well informed about your credit card costs It will help you to use your credit card much more conveniently and responsibly at the same time. It’s better to review the terms of your credit card available on issuer's website at least once or twice a year.

Applying for too many credit cards at the same time might not be a good option:

Each credit card application has the potential to knock points off your credit score. If you apply for several credit cards within a short period of time, you might notice the denials are more frequent as lenders start getting suspicious about the sudden onslaught of credit card applications. Apply for new credit cards one at a time on an as-needed basis.