I had used credit card of HDF bank since 2013. We need to be very careful while using the credit card by fixing upper limit for the amount you swipe. It is easy to get a credit card for a salaried/business man. We should limit the usage only for emergency cases and should pay the dues before the due date. Don’t take any EMI or cash withdrawal option with the credit card. For EMI, they will charge fixed amount of processing fee and heavy interest rate which will be very higher than the normal loan rate and service tax. Cash withdraw is also very costlier with credit card than loan/credit card EMI rate.
I will give a detailed view about the usage of the credits card with an example. Suppose X earns 30 K per month as salary and he has to pay rent, provision expenses, vegetable expenses, other home expenses, children expenses etc. In those cases, he can use card for Rs. 1, 000/ and can pay in right time. This is fixed as less than 5% of his monthly salary. This also use only if he incur it as an additional one and cant meet with his monthly savings. In addition if we had incurred some additional expenses, he wish to buy a lap top worth Rs35k, and LIC premium of Rs13k which is once in a year. Heavy travelling expenses on some emergency worth Rs 7000, hose hold furniture of Rs. 12, 000, additional travelling cost of Rs 3000. The total EM will be 7000 pm with interest, processing fee and all. This with additional purchase will eat out the income of salaried person. And if, he additionally, purchase every month for provision and the total dues will be more. They will charge penalty, even if the credit card holder pay the loan. So all this loan will get over only be one year. If he change his job and salary get delayed, the will charge heavy interest rate with 40% per annum and penalty. So never use the credit card EM option, you can go with gold loan which is cheaper then the credit card. Never go behind the reward points offered by the Banks which is totally ridicules way to make the card holder to spend more money with card.
You can use card only for emergency cases, that to if you don’t have any other option to get money like friends/relatives/gold loan or advance salary. Never ever use credit card if you have money with you. First limit keep cash itself for emergencies as card many not be accepted everywhere.