Use of credit cards has been on a rise since the demonetisation of currency notes in the year 2016. The boom in the economy also made credit card issuers to come up with innovative offerings in the form of more types of credit cards and superior reward programs. A credit card provides a number of benefits to consumers apart from the facility to postpone the repayment for a purchase. You can derive the maximum benefit out of your credit card by acting a bit smarter.

Use all Your Reward Points

Almost all the credit cards have a rewards program attached to them. Credit card users should utilize all the reward points to get the maximum benefit. People who do not like the gifts offered by credit card providers can opt for cash back cards which provide a straight cash back on the reward points accumulated on the cards. Make sure to redeem points regularly as the reward points on certain credit cards expire after a stipulated period.

Premium credit cards have a superior rewards program which offer benefits like access to airport lounges and golf clubs. Credit card providers like American Express even charge an additional fee to avail their premium rewards program. Heavy users should opt to pay the additional membership fee to access these superior rewards programs.

Make Your Purchases at the Beginning of the Billing Cycle

The amount in your savings account will yield a limited interest income. You can even get an additional interest income by putting your money in money market mutual fund. As credit cards provide interest free period, you can gain a higher benefit by make the monthly purchases at the beginning of your billing cycle. Even though the interest income earned by keeping the money in your savings account is small, it can add up to substantial amount if you follow this suggestion consistently.

get maximum benefit out of your credit card

Opt for Credit Cards Which Have Tie-ups with More Merchants

Credit card providers are also offering benefits to consumers like cash back on the purchases made and an extended free credit period on purchases made from specific merchants. For example, SBI Card and HDFC Bank offer cash back on purchases made at specific merchants and Ecommerce portals. Opting for these credit cards can be advantageous during the festival periods when merchants run shopping festivals.

Opt for Co-Branded Credit Cards

Co-branded credit cards are offered by credit card providers in tie-up with third party merchants. Co-branded credit cards offers additional benefits when the credit card is used for making a purchase with the third party merchant outlet or Ecommerce portal who has tied-up with your credit card provider. Additional benefits include higher reward points and regular discounts.

An additional benefit of using a co-branded credit card is the facility to directly redeem the reward points at the merchant outlet without any need to make an online redemption request and waiting for the gifts and coupons to arrive. Used rightly, a co-branded credit card can help in getting the maximum benefit out of your credit card.

Select the Credit Card that is Most Suitable to You

Since credit card providers provide multiple alternatives, it is better to opt for the credit card that is most suitable to you. People who fly frequently can benefit by opting for a credit card whose reward points can be converted to air miles.

Pay Your Credit Card Bills on Time

Last but not the least, always remember to pay your credit card bills on time. Delay in the payment of credit card bills will result in penalties and higher interest on the amount carried forward for the next month. Needless to say, the higher interest rates and penalties will negate all the benefits mentioned above.

As many users realize, credit cards are double edged swords. Following the above tips can help in getting the maximum benefit out of a credit card.