Individuals with zero or poor debt records may find it challenging to be eligible for a credit card. So, it might be easy for them to shuffle around a few options like a secured card and obtain a card with limited features to start or reshape their credit profile.
Contrarily, applicants with a promising credit history may find it overwhelming to avail cards from several feature-rich options. Therefore, to simplify the search process, applicants should be aware of the aspects to look for. Irrespective of spending habits, credit card comparison can be executed based on some elemental features like APRs, reward programs, fees, etc.
Here are the factors to consider while comparing various credit card options –
● Eligibility requirements
Qualifying measures are determined by card-issuing authorities to cut down the risk of a payment default. Lenders approve card applications based on the credit record and score, income, age, citizenship of applicants, etc.
However, these fundamental criteria are different across the product lines. Cards that offer better terms such as higher credit limit, affordable interest rates, attractive rewards, etc. are for applicants with excellent credit records.
Usually, individuals with a credit rating of 750 and above, consistent payment record, and higher monthly income are considered as excellent profiles. Nonetheless, every financial institution holds varieties of cards to cater to all types of debt profiles like average, good, excellent, etc.
Applicants thus need to determine the card they qualify for and opt for an online credit card application for a quick approval. This way, they can protect their debt history from being affected by rejections as well.
● Promotional offers
Loyalty points for transactions like purchase of groceries, fuel, entertainment tickets, dining, hotel expenses, cashback, discounts, etc. include promotional offers or reward programs that cardholders can earn with each, offline, and online credit card transaction.
Based on users’ spending pattern, individuals should look for the category of reward cards that suits their transactional requirements.
For instance, if borrowers frequently shop from some specific stores, they should consider reward cards that can be helpful to save expenses on the next store purchases.
However, to maximize the benefits of these incentives, users must know how to redeem credit card reward points and spend it for future expenditure.
● Rate of interest
APRs of cards fix the amount of interest component users need to pay on monthly balance in case of default in bill payment.
If applicants are confident of repaying the total due in each month, they can go for cards with expensive interest rates as well. However, if there are possibilities of carrying a balance, individuals should make credit card comparison depending on the competitive APRs.
● Annual charge
Usually, feature-rich cards also come with annual fees. Depending on the purpose of the card, borrowers should consider whether the benefits derived help in increased annual savings and are worth such fee payment or not and make their credit card comparison accordingly.
If debt consolidation or creation of reliable credit history is the primary objective of obtaining a card, applicants can opt for cards without annual charges as well. Nevertheless, if borrowers wish to avail reward program benefits, paying this fee can prove advantageous.
● Other fees
Furthermore, lenders can also impose various other fees for overseas transactions, balance transfer, advance withdrawal, loan against available credit limit, etc.
Thus, it can be beneficial for borrowers to find out cards with minimal additional costs. For example, individuals can consider cards like Bajaj Finserv RBL Bank SuperCard that charge zero interest on cash withdrawals from ATMs.
Moreover, to avoid the hassles of the card application process, borrowers can avail of their pre-approved offers. These offers help individuals to receive fast approval of various financial products and services like personal loans and business loans. Also, individuals can provide their mobile number and name to check their pre-approved offers.
So, credit card comparison is a smart way to reduce the probability of picking up an unsuitable card. Evaluating all these aspects can give a detailed insight into cards that help individuals to know how to use a card wisely and improve their credit history as well.