Why Using Credit Cards Is More Profitable Than Loans

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In a life situation when money is urgently needed, and not anyone comes to mind with 2 decisions: payday loans or a credit card. These products have many differences that not everyone knows about. Let us consider all the intricacies of obtaining and using both products. 

Credit Card Advantages

A credit card is a profitable way to receive funds for borrowers who regularly make purchases on the Internet, pay for goods and services by non-cash settlement. Using the card will be beneficial for people where money is needed for a short time. 

“Stores are never nice to people. They’re nice to credit cards.” — J.F. LAWTON. 

The main benefits of using credit cards include:

  • Interest rates are generally higher than consumer loans but always lower than payday loans, which on average have 600% interest.
  • There is a grace period during which interest is not accrued. If you manage to pay off the debt during this period, you can use the card without overpayments.
  • The credit card amount is renewable. Once the debt has been repaid, it can be reused. This is convenient for those who use borrowed money often — it is easier to issue one card than several loans.
  • The credit limit can be larger than the loan amount. If you use it often, the bank will be able to increase the available limit.
  • The card establishes more flexible conditions for paying off debt. It is usually enough to make a minimum payment every month — part of the amount of the debt plus accrued interest.
  • Often offer bonus programs for their holders. Purchases are awarded cashback or bonus points that you can spend or withdraw from your account.
  • Easier to use abroad. With it, you can pay costs in any currency — money is exchanged automatically.
  • There are credit cards that allow you to buy goods and services in interest-free installments. Purchases paid for by such a card are redeemed in parts within a certain period.

What are the Benefits of Payday Loans?

The main advantage of the best online payday loan is the ability to immediately receive a fairly large amount that can solve many financial problems. Also among the pros are the following points:

  • The terms of receipt are simpler. Microfinance companies do not impose strict requirements on borrowers, and only a passport is enough to apply for and receive money.
  • Less likely to be refused. Also, many companies are loyal to customers with a bad credit history — payday loans will help you fix it and get better offers.
  • Speed of approval. It often takes from a few minutes to one working day to consider the application and transfer money.
  • The ability to get money online. You can get them in any region of the country — you only need access to the site or application.
  • The ability to pay in different convenient ways. You can repay the debt using a bank card or wallet, by money or bank transfer, in payment terminals, and in many other ways.
  • The ability to issue a renewal (extension) if you do not have time to return it on time. 

“If you don’t take good care of your credit, then your credit won’t take good care of you.” ― TYLER GREGORY.

Using Credit Cards Is More Profitable

A credit card is suitable if you: 

  • often take borrowed funds in cashless form;
  • use borrowed money mainly to pay for purchases;
  • observe the grace period to enjoy without interest;
  • need a convenient tool for shopping abroad or in foreign online stores;
  • want to have a spare source of borrowed money for contingencies.

In any case, when issuing a credit card or payday loan, calculate your capabilities in advance and plan to repay the debt. With the right use, each of these tools will be a convenient solution in the right situation and will not bring problems.

 

 

 

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