How does a credit card work, advantageous or dangerous? | Economy | News

It can become a ‘salvation’ in the face of an unforeseen event as well as a long sentence that seems to never end; credit cards are a mechanism for obtaining money that, with responsible use, can become an ally.

These cards can be linked to a financial institution or another company that issues them. Credit cards are a plastic or metal method, which is associated with a client that allows them to carry out transactions without having the money in their account, since it works as a credit that the client must pay after the cut-off date. in whole or a minimum or lesser value, in this case interest will be generated.

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There are some cards that give you the option to defer a purchase for months without interest, in this case you will only end up paying the value of the ‘loan’ you made.

As already mentioned, credit cards are not ‘bad’, everything will depend on the responsible use that is given to them by the client.

Benefits of credit cards

• It allows you to make payments of large amounts to acquire an asset.
• It is used to solve any eventuality such as a medical emergency.
• In case of loss it can be blocked, however, if the cash is lost it will be difficult for this to happen.
• It allows you to have a credit history in case of good use and responsible payment.
• You can participate in a rewards program.
• Financing expenses during a trip abroad.

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Disadvantages of having a credit card

• Data theft by entering information on unsecure portals.
• Making excessive expenses that lead to an overdraft and the difficulty of solving your debts.
• In some companies a maintenance amount is established.
• Non-payment generates interest, which makes a debt difficult to resolve. (I)