If you asked anybody today why they have the credit card(s) they’re using, chances are they might tell you it’s because of the reward points, or because it’s part of their bank’s package, or maybe it offers the best cashback deals. But credit cards have more fundamental features and uses than that.
In this post, GoBear Malaysia examines some substantive reasons why you should pick up a credit card if you can afford it.
1. Defer full payment on purchases.
One reason to have a credit card is that a credit card actually represents what’s known as an unsecured ‘revolving line of credit’ that is readily available to a large number of people. It provides you a level of financial flexibility that allows you to more easily afford certain purchases by putting it on your card and paying for it later. In essence, you put off paying for your purchases for up to a month (or, in the case of instalment plans, several months). This can come in helpful if you had to pay for something now, but you would only have the funds available in the future.
Online shopping and bill payments is much harder without using a credit card
2. Shop and conduct other transactions online.
Even as cryptocurrencies such as Bitcoin continue to become more popular for online transactions, credit cards remain the primary means by which you can shop and pay your bills online. PayPal and Amazon, for instance, nearly almost always prefers that you have a credit card on file with them, and many online services can only be paid for via credit cards, if you are an international customer (as Malaysians mostly are). Some of our utility bills can also be paid for online without using Internet banking… if you have a credit card. So, if you like the convenience of shopping and paying for bills online, there’s another good reason.
3. Make international travel and purchases easier.
Bank-issued credit cards linked to international networks such as Visa, MasterCard or UnionPay are usually accepted worldwide, allowing you to travel without carrying around large amounts of foreign currency or travellers’ cheques. In addition, the conversion rate is more current (sometimes as good as or better than what you will get at the moneychanger), and allows you to avoid fluctuations in foreign exchange rates. Many credit cards also reward you more for foreign transactions.
4. Just plain convenience.
The last reason to have a credit card is the added value that they give you. There’s no denying that whipping out your credit card is easier than carrying around large bundles of cash in your wallet (or handbag). You can pay many recurring bills using auto-debit and say goodbye to forgetting a payment ever again, link your bank accounts to it (if your bank allows it), and in certain countries, even the fishmonger or butcher at the wet market accepts credit cards.
There are many good, solid reasons why you should have – and use – a credit card. And yes, many issuers have promotions and deals that reward you for spending on your credit card, including discounts at partnering stores. Higher-tier credit cards provide you with even more privileges, including a concierge service, complimentary travel insurance and even golfing rights at international golf courses – so if you qualify for those cards, why not?
Looking for a good credit card doesn’t have to be hard, either. Just use GoBear Malaysia’s comparison services and pick the credit card that suits your fancy most.