Credit cards issued till date have crossed the 50 million mark. On the other hand, credit card transactions worth Rs.6 lakh crore was recorded in 2018-19, almost 30% higher than the previous year.
Data suggest that Indians are shifting increasingly towards digital and cashless transactions in most cases. To fuel this habit, financial institutions have introduced several incentives to generate further user loyalty.
Credit card companies compete with each other to offer the best sign-up bonuses, reward points, cash-back facilities in the market to retain credit card users.
It also serves users the best to know when to upgrade credit cards to avail the best offers in the market.
Why should you upgrade your credit card?
Before deciding to upgrade your credit card, consider why you want to do with it. With NBFCs coming up with innovative offers on credit cards so frequently, you have to see whether your card is falling behind on the following pointers –
- Reward points
If your credit card provider fails to provide maximum reward points in a competitive market, aim to upgrade credit card.
- Old cards
Individuals using credit cards older than 10 years often miss out on the opportunity to avail current benefits on credit cards.
However, don’t close your older cards and apply for new ones. Old credit cards will help you to improve your credit score.
- Shift in spending curve
In case your spending habit has changed, you can choose new credit cards that offer product-service-specific reward points and cash-backs.
- Low credit limits
Your old card may not extend the credit limit as per your financial requirements. This is when you should opt for a credit card with higher credit limits.
Benefits of upgrading your credit card
A regular credit card user will encounter the following 5 benefits of upgrading their credit cards –
- Increase in credit limit
An upgraded credit card ensures that you can avail a higher credit limit to sustain your financial requirements. The same suggests that you can opt for bigger purchases with the new credit card.
- Boosts credit score
Credit score and rating of an individual can be boosted with an upgraded credit card, provided the credit utilisation ratio remains below 50%. You can also consider other ways to use a credit card to improve your credit score.
- Attractive sign-up offers and rewards
Credit card issuers often attract new customers with innovative sign-up offers and rewards. These offers are generally unique and beneficial to individuals looking for new credit cards.
- Efficient cash flow management
You can implement the best practices in cash flow management after upgrading your credit card. Make sure the billing cycles of your respective credit cards are different so as to reduce the burden on bill payment.
- Faster approval of loan
As upgraded credit cards raise the credit score of an individual, it helps them to secure loans at lower rates of interest quickly.
Rules for upgraded credit cards
Upgraded credit cards follow pretty much the same credit card rules as existing ones. However, one needs to be careful when it comes to –
- Frequency of credit card use
Upgraded credit cards accrue higher annual charges. To prevent this issue, make planned purchases every once in a while to accumulate reward points. Redeeming these points will help you to compensate for such charges.
- Payment of credit card dues
Credit card dues are best repaid by the end of the billing period. Else, they incur late charges, which ultimately burden the user financially. Repay your credit card debt for better creditworthiness.
When looking to upgrade your credit card, opt for ones like the Bajaj Finserv RBL Bank SuperCard. Zero-interest emergency personal loans for up to 90 days and ATM cash withdrawals up to 50 days are some of the features coming with this card.
Upgrade credit card to avail the market-best features and advantages to be a part of the cashless transaction revolution. Before doing so, make sure to check the interest rates and charges applicable.