Why do you never apply for a credit card? What are the advantages and disadvantages of applying for a credit card?

Why do many people say you should never apply for a credit card? What are the advantages and disadvantages of applying for a credit card? What

Credit cards are a common payment method for overdraft consumption in daily life. After applying for a credit card, we can make overdraft purchases within our own limit, and there is also an interest-free period of up to 50 days. Exclusive benefits for each period, so more and more users are fascinated by the feeling of traveling around the world with one card in hand.

Although credit cards bring us great convenience in daily life, some users think that credit cards are quite deceptive and warn others not to apply for credit cards. So, are credit cards actually good or bad? It mainly depends on the usage and actual needs of the cardholder. While credit cards may bring convenience to others, they may also bring disadvantages to some users. So let’s take a look at the advantages and disadvantages of credit cards. .

Benefits of credit cards:

1. Convenient travel: If many users go abroad or travel to other places, it is particularly convenient to use credit cards for consumption. Especially when we go abroad, credit cards are often used. Payment can be made in other countries.

2. Long interest-free period: The interest-free period of credit cards is generally about 50 days, so it can repay our financial pressure when users need it.

3. Many activities bring discounts: Nowadays, credit cards basically have their own corresponding activities, so users who apply for a credit card that suits them can bring many discounts to themselves in daily life, such as many The car owner's card has corresponding discounts when refueling.

Disadvantages of credit cards:

1. It is easy to develop a psychology of dependence, resulting in irrational consumption: Some users who do not have strong self-control may develop a psychology of dependence in the process of using credit cards. , feel that they have no money anyway and can still use credit cards for consumption, so they consume without restraint, which causes great financial pressure on themselves to repay later, and may also cause overdue repayment. Some users even have financial difficulties. When you use a credit card to cash out, you will owe more and more later, causing your own financial mess.

2. Credit cards will charge annual fees: Generally, after we apply for a credit card, there will be a corresponding annual fee. When many users use credit cards, they may ignore the annual fee, causing the credit card to expire later. However, as long as users meet the requirements when using credit cards, they can also get annual fee reductions and exemptions, so users can pay more attention.

3. There is a possibility of credit card theft: Nowadays, it is inevitable that some criminals will use various means to steal users' credit cards. Therefore, once a credit card is applied for, there will be risks in this regard.

What are the advantages and disadvantages of applying for a credit card?

The advantages and disadvantages of applying for a credit card are:

Advantages of credit cards: Compared with ordinary bank savings cards, credit cards , the most convenient way to use it is to make ordinary purchases without cash in the card. In many cases, you only need to return the consumed amount on schedule. You can make overdraft purchases without depositing. It is not only safe and convenient to swipe your card when shopping, but you can also get points as gifts. You can enjoy discounts when you use your card at the bank's designated merchants.

Disadvantages of credit cards: The invention of credit cards is like a double-edged sword, which can solve the temporary economic crisis. However, the purpose of banks issuing credit cards is to make money. Once the interest-free repayment time is exceeded, high fees will be charged. The interest on the amount is generally 0.05% per day. Developing the habit of blind consumption leads to blind consumption and spending money like water.

If you cannot repay on time, the bank will charge high interest. Long-term malicious arrears will naturally affect your personal credit record and even be blacklisted by the bank.

What are the consequences of applying for a credit card?

There will be consequences if you don’t use a credit card.

1. Many high-end credit cards will charge an annual fee after application, regardless of whether they are activated or not. Therefore, if you just throw the card aside and don’t look at the bill after applying for it, it will cause overdue payment. As the annual fees accumulate, the overdue payment will become more and more serious, which will also cause a lot of damage to the user’s personal credit report. Big impact.

2. As long as you apply for a credit card, it will be recorded in the central bank's credit report. If the user's card is not activated, "The card has not been activated" will also be displayed on the user's personal credit report.

According to Article 7 of the "Regulations on the Supervision and Administration of Credit Card Business of Commercial Banks": A credit card refers to a credit card that records cardholder account information, has bank credit lines and overdraft functions, and provides cardholders with relevant banking services. All types of media.

Credit cards stipulated in the relevant laws of our country ("Interpretation of the Standing Committee of the National People's Congress on Relevant Credit Card Regulations") refer to credit cards issued by commercial banks or other financial institutions with the functions of consumption payment, credit loans, transfer settlement , cash deposit and withdrawal and other full or partial functions of the electronic payment card. On December 1, 2017, the "English Translation and Writing Standards in the Public Service Field" was officially implemented, stipulating that the standard English name of credit cards is CreditCard.

Credit card consumption is a non-cash transaction payment method. There is no need to pay cash when consumption, and repayment will be made on the billing date (BillingDate).

Credit cards are divided into credit cards and quasi-credit cards. Credit cards refer to credit cards in which the cardholder has a certain credit limit and can consume within the credit limit and then repay; quasi-credit card It refers to a quasi-credit card in which the cardholder deposits a certain amount of reserve fund as required. When the reserve account balance is insufficient to pay, the cardholder can overdraw within the prescribed credit limit. The so-called credit card generally refers to a credit card only.

Starting from January 1, 2021, the credit card overdraft interest rate will be determined independently by the card issuer and the cardholder through independent negotiation, and the upper and lower limit management of credit card overdraft interest rates will be cancelled. The daily interest rate is 0.7 times 5/10,000).

On May 25, 2021, the Supreme People’s Court issued and implemented the “Regulations of the Supreme People’s Court on Several Issues Concerning the Trial of Bank Card Civil Cases.”

What impact does opening a credit card have on you?

1. Benefits of opening a credit card:

1. You can overdraft for consumption, and when you have insufficient funds, you can swipe the card for consumption Or withdraw cash.

2. Enjoy the convenience of installment. After a large purchase, you can pay it back slowly in installments.

3. Convenient travel and enjoy discounts. There are many different types of credit cards now. Some have the function of taking the subway and bus, some have discounts for booking air tickets and hotels, and some are convenient for converting foreign exchange when going abroad.

4. It is convenient for financial management and investment. Credit cards have an interest-free period of up to 56 days. During the interest-free period, users do not have to pay interest. Users can use their own money for investment.

5. Points can be redeemed for items. Generally, you will get points when you use a credit card to purchase items. The points can be purchased in the bank points mall.

2. Disadvantages of applying for a credit card:

1. After applying for a credit card, a credit report will be submitted. Once your credit card is overdue, an overdue record will appear on your credit report, which will affect own credit.

2. It will be stolen. If your credit card is stolen by others, it can easily be stolen and cause losses to yourself.

3. Let your consumption become irrational. If you use a credit card to consume without having to pay it back immediately and pay it back next month, it is easy for people to consume blindly.

Credit limit

Credit limit refers to the maximum overdraft limit given by the bank to your credit card when it approves your credit card. You can only spend within this limit, and if it exceeds This amount cannot be used for regular card payments.

The credit limit is determined based on a comprehensive evaluation based on the information you filled in when applying for a credit card and the relevant supporting documents provided. The principal card and supplementary card*** share the same limit. Under normal circumstances, the RMB limit and the USD limit in a dual-currency credit card can be converted to each other. For example, if your limit is 30,000 RMB, when you use the card overseas, your credit limit is approximately equivalent to 5 ,000 USD.

The credit limit will be adjusted regularly by the bank, but you can proactively provide relevant proof of financial resources to request adjustment of the credit limit. In addition, when you need a higher limit within a certain period of time when traveling abroad, moving to a new home, etc., you can request to increase the temporary credit limit.

Transaction date

The date when the cardholder actually used the card for transaction.

Accounting date

Also known as the entry date, it refers to the date when the card-issuing bank records the transaction amount into the cardholder's credit card account after the cardholder uses the card to make a transaction, or the card-issuing bank records the payment according to relevant regulations. Agree on a date when the relevant charges will be credited to their credit card account. The general billing date is the day after the cardholder's actual consumption date. For example, if you shop on December 1st, the general billing date is December 2nd.

Billing Date

The billing date refers to the card-issuing bank’s regular monthly summary of various transactions and expenses incurred in the cardholder’s credit card account in the current period, and the settlement of interest and calculations. The date on which the cardholder should repay the amount in the current period.

Repayment Date

The date when the cardholder actually repays the credit card account to the bank.

Interest-free repayment period

For non-cash transactions, the period from the bank accounting date to the due repayment date is the interest-free repayment period. The interest-free repayment period is as short as 20 days and as long as 56 days. During this period, as long as you repay the current balance due on the current statement in full, you will not have to pay any interest on the funds advanced by the bank to the store for non-cash transactions (cash advances do not enjoy the interest-free discount).

Repayment due date - the last date specified by the card issuing bank when the cardholder should repay the entire repayment or the minimum repayment amount.

Closing your credit card account is something you must do if you no longer intend to use your credit card. If you do not cancel your account, the bank will charge the credit card's annual fee.

As long as there is no overdraft on the card, you can apply for account cancellation at any time.

If the card has not expired, you need to apply first and go to the bank to cancel the account after a certain number of days; if the card has expired and the account balance is zero, you can go directly to the designated bank outlet to cancel the account. Account procedures. When canceling an account, you should bring the original valid identity document and card. If it is inconvenient for you to go through the account cancellation procedures, someone else can do it for you. The agent must hold a power of attorney written by the principal (in person) and bring the original valid identity document to handle the account cancellation business.

If your card has not expired when canceling a credit card account, some banks stipulate that you need to go to a designated outlet to handle the card collection business, and then go through the formal account cancellation procedures after a certain period of time (up to 30 days) .

This is mainly because if the cardholder has made a manual card pressing transaction before canceling the account, the cardholder has already canceled the account before the merchant has submitted the card pressing slip to the bank for entry into the account. , so the bank cannot liquidate regularly; on the other hand, if the cardholder consumes or withdraws cash overseas, it may take a few days to liquidate. If the account is closed immediately, it will also affect the bank's normal liquidation.

What are the disadvantages of applying for a credit card?

The advantages and disadvantages of applying for a credit card are as follows:

1. Advantages of a credit card:

1. No You can make overdraft purchases by depositing money, and you can enjoy an interest-free period of 20-56 days. 2. When you swipe your card when shopping, you will receive points as gifts. 3. You can enjoy discounts when using the card at the bank's designated merchants. 4. Accumulate personal credit and add integrity records to your credit files. 5. You can withdraw money or make purchases by swiping your card at ATMs and POS machines with the UnionPay logo. 6. Some credit cards can collect existing points. 7. Free monthly mailing of statements. 8. The supplementary card function allows you to manage finances at the same time and control your children's financial expenditures. 9. One card with dual currencies, overseas consumption can be repaid in domestic RMB. 10. 24-hour service hotline, loss report takes effect immediately. 11. Cooperate with third-party platforms to provide preferential services to cardholders.

2. Disadvantages of credit cards:

1. Credit cards can easily lead to over-consumption. 2. Credit card annual interest rates are higher. 3. Credit card debt can cause mental stress. 4. If your credit is not good, the cost of borrowing money will be higher, and you may even be unable to borrow money.

Currently, all major banks support credit card processing, such as Industrial and Commercial Bank of China, China Construction Bank, China Merchants Bank, etc. You can apply for credit cards at each bank's mobile banking APP, online banking and business hall branch counters.

Many people often apply for emergency loans when they are unable to open a loan in their lives. Baidu has money to spend: Du Xiaoman's small credit loan has a maximum limit of 200,000, a maximum loan period of 24 months, and an annual interest rate as low as 7.2%. The specific interest rate is shown on the loan page. You can borrow and repay flexibly at any time, apply for the whole process online, and there is no guarantee or mortgage. Submit the application and get the result within a few minutes. Once approved, you can get the money on the same day.