In today’s world, we all have credit cards, and if you’re new to this part of the finance world, it is way too tough to understand every concept and use it in favor of us. The credit limit was easy to understand, but knowing about APR or statement balance is where we get completely lost.
But to solve this issue of ours, we will explore key terms of credit cards and how they will help us better understand this financial tool. Additionally, we will also talk about how utilizing resources like the ICICI credit card app can provide valuable insights and assistance in managing your credit card effectively.
Credit Limit
A credit restraint is nothing but a set upper constraint for the utilization of your credit card. The credit restraint is characterized at the time of issue of credit cards, as the backer considers your financial soundness, wage, and different variables sometime recently permitting you a credit card with a set credit constraint. You should also pay attention to ensuring timely payments, and apps like ICICI Bank credit card payment app, can help maintain a good credit score and financial health.
Minimum Due Date
This is the date by which you must make at least the minimum payment on your credit card to avoid late fees. Missing this deadline can also negatively impact your credit score.
Late Payment Fee
As the name suggests, this fee is charged when you make the minimum payment by the due date. This step is involved to ensure users of credit cards understand the importance of repaying them.
Cash Advance
Withdrawing cash from your credit card is known as a cash advance. Remember that cash advances usually come with high-interest rates and additional fees, making them an expensive way to access cash.
Credit Score
A credit score may be a quantitative degree of your financial soundness, and it decides whether you are eligible enough for the IndusInd bank credit card payment program or not. This score is based on different components like installment history, credit utilization, and the length of your credit history. In basic terms, the next credit score makes a difference; you qualify for way better credit cards. Credit
Utilization Ratio
This ratio shows the percentage of your credit limit that you’ve used. Keeping this ratio low, ideally below 30%, can positively impact your credit score.
Annual Fee
The annual fee is a simple fee that is charged annually, mainly for using credit cards. Annual fees are different with different issuers, so users need to first check and compare before getting one. Now even different UPI apps charge certain annual fees for the services.
Rewards Points or Cashback
Credit cards also offer rewards and cashback similar to any UPI app. The mechanism of the reward system in credit cards is different as you earn points or cashback on every dollar spent through a credit card. These rewards can be helpful in times of traveling, gift cards, and others.
Conclusion:
To manage your finances, you need to understand various terms and terminologies of the finance world. Today, we started with credit cards, where we even understood what a balance transfer is, as this is that one concept that confuses a lot of people. Try to familiarize yourself with these terms, try to opt for resources even from reputable banks and institutions like ICICI credit card payment app offer multiple options of learning material and then use this plastic card wisely by avoiding all of the costly mistakes.