Around 51 million UK adults, 96% of the population, use a credit card. By 2026, the total value of credit card payments is estimated to be £942 billion; it was £638 billion in 2016. Almost 98.5 million debit cards were being used in the UK in October 2017. The growing use of credit card implies that people want extra freedom to spend even while not having the cash. The rising figures also indicate that the dependency on credit card is increasing. People are using overdrawing facility also despite the high-interest rate levied after the free to use period. As the usage and dependence are growing, the numbers of options for having the credit card also increasing.
Why You Should Use Credit Card- The Benefits
If you use a credit card with a smart approach, no cost borrowing is also possible. It may make your eyes wide open, but it is possible. To get the advantages for a financially stress-free life, you need to better plan the purchases at cash back, or rewards points offer. But, if you are not a disciplined user, you may end up with high stresses of paying massive interest, mounting up debts, dipping credit score etc. Even before applying for a credit card, it is just to explore all the benefits and the possible harms. Let’s start with benefits:
Speed: If you need something expensive that you can’t afford to purchase in one go, using a credit card is the best way as long as the purpose is justified. The 0% purchase credit cards allow paying in full for the purchased item and spreading the cost over numbers of months for the fixed amount instalments. If you succeed to pay the total amount off before the interest-free period ends, you don’t pay any additional charge.
Protection: The credit card payments are better protected if compared to the payments made through debit card, cheque or cash as per Section 75 of the Consumer Credit Act that defines that the credit card agency is liable for misrepresentation or breach of contract by a retailer. Any purchase of service or goods is protected by Section 75 of the Consumer Credit Act. You are also protected if the card is misused; the claim will be made by the card issuing company.
No cost borrowing: Some credit card agencies offer 0% interest rate period that allows you to use the funds without paying an interest rate. For using this fund, you also don’t need to do any complex documentation. Using the interest rate free cash helps you manage the finances better.
Earning with spending: Yes, it possible. Because of intense competition, the numbers of credit card agencies offer a variety of incentives including the free air miles, cash back, discounts for particular brands and loyalty points etc.
Switch the dues: If you owe the debt on different store cards, pay the amount using the interest rate free cash facility being offered by credit card. It is often seen that people make purchases being trapped in discount offers made under the privilege cards but sooner they find themselves in deep trouble for paying within the time frame.
A disadvantage of Credit Card:
If we see the advantages of using a credit card, the problems seem easy to manage. The principal difficulties are the possibility of a debt trap, hidden cost, reporting to credit bureau agencies etc. By making sensible purchases, a chance of being debt trapped can be avoided. Each transaction of credit card is said to credit bureau agencies, but if you are making the payments on time, it goes in your favour. Not all the credit cards have hidden cost; by choosing the best credit card, you can eliminate this possibility also. What are the trending options to pick the best credit card in the UK in 2019?
The Top Credit Cards for 2019:
Santander Everyday Credit Card: It stands up as a winner in the competitive marketplace because of offering the 27 months of 0% interest on balance transfers. It also provides 3 months of 0% interest on the purchases. It provides plenty of cash back also offers the sweetener.
American Express Platinum Cashback Everyday Card: This card helps you enjoy the broader scope of getting cash back rewards from almost all the leading brands. It offers 0.5% standard cash back on all the transactions but for the users spending more than £5,000 a month. New cardholder gets 5% cash back as a bonus over the 1st three months period; the money again is capped to £100.
Post Office Platinum Card: It offers 28 months of 0% APR credit on the purchases. It also offers 0% for 18 months on the balance transfers but with processing fee @ 2.89%. It is an excellent pick for regular travellers; since the users don’t pay any tax on overseas purchases. It is made available at no fee.
Tesco Bank Foundation Credit Card: If you need a credit rebuilder card offering much more than to access to small amount credit, Tesco Bank Foundation Card is just for you. It provides free access to Tesco Clubcard benefits and Noddle Premium services. The manageable credit amount limit and low APR make this card the most affordable facility for the UK households having a poor credit score.
Capital One Quicksilver Credit Card: It is the best pick for getting unlimited 1.5% cash back every day on each purchase. The card can be used to pay gas or groceries bills etc.; it means you will get instant cash benefit helping you save more. The card offers intro bonus also.
When you have the variety of options, selection of best often becomes confusing and complicated. If you are confident for paying the balance in full each time within interest rate free period, take advantage of card offering the most extended interest rate free period. If you are more interested in cash backs, focus on the cards giving assured cash back without limit. However, the checklist for picking the best credit card includes Annual Percentage Rate (APR), introductory interest rate, minimum repayment, annual fee, charges, processing fee, required formalities, loyalty points or rewards and cash back etc.