Advantages of using a Debit Card to buy your next Phone
Credit Cards have traditionally been the preferred way to buy electronics like mobile phones online. These cards do offer a lot of rewards and discounts, but credit cards come with hidden additional costs which you may not notice. Costs like:
Comparatively high interest rates
Taxes on your purchase
Card Subscription fees
Credit cards are also not a great option if you are not experienced with handling money. If you miss payments on your credit card interest rates can be unreasonably high and penalties card increase your burden drastically. Even though there are a number of benefits of using a Credit Card wisely, there is an additional credit that you are taking on.
With Debit Card EMIs you get the advantage of not increasing your debt burden while deferring payments for your purchases online. Here are some of the top reasons to pull out your debit card instead of your credit card while buying your next mobile phone:
Credit Cards carry high interest rates due to the sheer convenience of them. While using a Debit Card to make payments via EMI you are not taking on any additional credit, you are just making deferred payments for your purchase from your savings account. The fact that you are making payments from your existing funds means that you are not liable to pay interest to anyone.
No Hidden Costs
While using your debit card to make purchases online there are no hidden costs or additional fees attached. There could be a small processing fee charged by the bank’s payment gateway, but this is a negligible amount.
Protect your Credit Score
Credit Cards are great tools for availing credit, but if you miss a payment, the additional interest rates, penalties, fees etc could quickly snowball out of control. Missing payments on your credit card can affect your Credit Score quite adversely and your Credit Score is crucial for a bank to judge your credibility as a customer. A low Credit Score can prevent you from availing loans and other products in the future when you really need them. Using your Debit Card to make payments can help you boost your credit score without taking on too much additional risk.
Control your Spending
Using a debit card to make purchases like mobile phones is a good idea because it gives you an idea of how much you can actually afford. Debit Card EMIs allow you to budget your spending every month around the EMI payment and prevent you from going beyond your reach and ending up in a credit trap.
Discounts and Offers
Many online shopping portals like Amazon and Flipkart offer great Debit Card EMI offers. Debit Card offers are sometimes better than Credit Card offers on these sites because unlike Credit Card rewards and offers, which are mostly provided by banks, Debit Card discounts and offers can be provided by the portals, payment gateways and merchants as well.
So next time you plan on buying a mobile, Debit Card EMI may be a good idea instead of pulling out your credit card.