Credit cards have long ceased to be a mysterious attribute of successful people. Today it is an affordable and popular financial instrument. According to the Central Bank of the Russian Federation, as of 01.08.2020, 40 million credit cards were issued.
If used correctly, the card can be an indispensable assistant; if used irresponsibly, it can make a client a detractor and a debtor. So, what should you know and what to look for when applying for a credit card?
What is the grace period? Everyone knows that this is the period of using the bank’s funds, in which interest is not charged. The longer it is, the better. However, the cardholder must take into account how the grace period is calculated (from the first day of each month, from the date of the first spending on the card, etc.).
An important point is the exit from the grace period. Ask the bank’s employees what conditions must be met for the card to be regularly in the grace period. What percentage will the client pay if the card has already been withdrawn from this? What is the interest rate on the card, what is the required payment?
If the credit card is no longer in the grace period, it is advisable to understand the interest rate scheme. Knowing the settlement mechanism will help avoid misunderstandings with the bank.
Fines and penalties. Absolutely undesirable option for every client, however, you need to be familiar with it. If the obligations on the card have not been fulfilled, what interest is charged by the bank, what is the amount of fines or penalties. How the bank notifies the client about the need to make a payment – it is recommended to clarify all these aspects with the bank before using the card.
Tariffs and commissions. The card can be used as an electronic wallet for non-cash payments, it can be used mainly for cash withdrawals. As a rule, in the first case, there are no commissions for purchases, in the second, there is a percentage for withdrawals. That is, you need to find out the size of the withdrawal commission, how extensive the network of ATMs and terminals is, and whether it is possible to withdraw funds from ATMs of other banks if necessary.
Control over the map. Each owner of a credit card needs to understand that it will be repaid at the expense of personal funds. Therefore, it is very important to exercise personal control over the movement of funds and payments. Almost every bank has already developed its own internet account, where the client can check their accounts, make transfers and much more. In fact, Internet banking gives the user access to information that previously could only be verified by contacting the bank.
Overseas use. Most banks’ cards are active abroad and available for use. Mostly cards are issued on the platform of two international payment systems – Visa and Mastercard.
When traveling outside the country of the issuing bank, it is recommended to ask its representatives what operations can be performed with the card, whether additional commissions will be charged, how the conversion will be carried out when paying abroad, and whether the channel of customer support from abroad will be available.