Understanding the world of Credit cards
Credit cards have become an indispensable part of modern financial life 신용카드 현금화 수수료. They offer convenience, security, and a wide range of benefits when used responsibly. Whether you’re a seasoned cardholder or someone considering their first credit card, this comprehensive guide will help you navigate the world of credit cards.
What is a Credit card?
A credit card is a plastic payment card that allows you to borrow money from a bank or financial institution to make purchases. It’s a form of revolving credit, meaning you can borrow and repay repeatedly, up to a predetermined credit limit.
How do Credit cards Work?
Credit cards work by providing a line of credit to cardholders. Here’s a simplified breakdown of the process:
To obtain a credit card, you must apply to a bank or credit card issuer. They’ll review your credit history, income, and other factors to determine your creditworthiness.
If your application is approved, the issuer will assign you a credit limit. This is the maximum amount you can borrow on the card.
You can use your credit card to make purchases in stores, online, or over the phone. The card issuer pays the merchant on your behalf, and you are then responsible for repaying the amount spent.
Every month, you’ll receive a statement that details your card activity, including the balance, available credit, and minimum payment due.
You can choose to pay the full balance (avoiding interest charges) or make a minimum payment (incurring interest on the remaining balance).
If you carry a balance from month to month, the issuer will charge you interest on the outstanding amount. The interest rate is called the Annual percentage rate (APR).