Preaload Image
05 Feb

3 Ways to maximize returns on Plastic Money!

The power of plastic money – ‘Buy now, pay later’ has become a modern day convenience, but the history of the earliest credit cards dates back to the early 1900s. You’ve read and seen this in books or movies depicting the society where the local general store would extend credit to regular customers, and department stores in the cities would do the same. Though we have come a long way from local general stores to online shopping, but one thing that hasn’t changed is the use of credit.

And with the e-commerce and retail industry on the rise and the economy at large, credit cards won’t be disappearing anytime soon. The benefits of a credit card comes with the ease of carrying, better security and protection compared to cash, increasing your purchasing power, value added benefits like cash back and reward points, and emergency protection are some of the benefits that one can easily avail through credit card.

Here are 3 quick ways to maximize these benefits-

  • Go for the long run– Become a long term customer with frequent use of the credit card. The longer the use of credit card showing good credit behaviour, more the positive impact it has on your credit score. Also, your chance of getting a loan, even a bigger loan, from lenders becomes brighter.
  • Bridging that extra mile– It is a good practice to utilize maximum of your credit limit towards the beginning of your credit cycle. Suppose your billing cycle is from, say, 10th of the month, then try to make maximum use of your card closer to dates in and around after the 10th of that month. The more your usage is closer to the 10th , the maximum free credit you get.
  • Look out for the speed breakers– Try to avoid minimum payments on your outstanding amount. It is advisable to pay 100 per cent of your credit card bills as far as possible. Keep yourself disciplined to pay on time all the outstanding dues as this reflects good credit behaviour which also impacts your credit score.

Be light, be smart and carry a card.

Satish Mehta
Satish is a Chartered Accountant by education, a veteran of Housing Finance and a Credit Information practitioner with over 40 years of experience. He previously worked with HDFC Ltd – India’s largest mortgage finance company and was the founding Managing Director of CIBIL – India’s first and largest Credit Information Bureau. He has global experience in his chosen fields, is a Professor of Practice at a leading University and has written e-books for the World Bank on his subjects. He is passionate about learning & knowledge transfer & believes in giving back to the industry he worked in throughout his career.

Leave a reply