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CIBIL Score: In today's time the use of credit cards has increased a lot. People have started using credit cards not only in cities but also in villages. Well, why not… The more transactions you do, the more reward points you will get and later with those reward points, you can get gifts, do shopping and also get cashback. However, while using credit cards, people often forget that they are actually shopping by taking a loan, which they have to repay later and even a small mistake can cause huge losses. Let us know about 3 such transactions, which should never be done with credit card (When You Should Not Use Credit Card), otherwise you may get into trouble.
1- Never withdraw cash from ATM
Neither the bank nor the agent tells this while selling the credit card. Rather they point out that withdrawing cash from credit card is a special facility. However, what they don't tell you is that the cash you withdraw will attract hefty interest from day one. This interest can be 2.5 to 3.5 percent per month i.e. 30-42 percent annually. Not only this, you will also have to pay a flat transaction tax. However, you get one month's time to pay the bill for shopping done through credit card. If you do not pay the bill by the due date, you are charged interest. There is no time to repay the cash withdrawn from ATM and interest starts accruing from the very first day.
2- International transactions will be expensive
A special feature of every credit card is that it can be used abroad also. Many people are attracted towards this feature of credit cards, but many people do not understand the story behind it. When you use a credit card abroad, you have to pay transaction fees, which keep increasing and decreasing. By the way, if you want to use card instead of cash abroad, then for this you can use prepaid card instead of credit card.
3- Do not overuse the card for balance transfer
Many credit cards have a facility called balance transfer. Using this you can pay the bill of one credit card with another credit card. It may sound surprising that you get 30-45 days to pay a shopping bill on one credit card and then pay the first bill on another credit card, giving you 2-3 months to pay the shopping bill. Will get time.
Here let us tell you that balance transfer is not free, for this you have to pay a charge to the credit card company or bank. It has another big disadvantage. Credit card is a type of loan. In such a situation, if you pay the bill of one credit card with another, it means that you are taking another loan to settle one loan. There is no problem in transferring balance in case of emergency when you are very short of money, but do not make it a habit. Doing this too much will have a negative impact on your CIBIL score.