6 Ways you can Handle Credit Card Debt

With a GDP of $1.09 trillion, India is the 2^nd fastest growing economy in the world. However, there has been a drop in the country’s GDP from 7.5 % in 2018 to 6.8% in 2019. Due to this decrease in GDP, the inflation rate has increased from 3.48% in 2018 to 3.88% in 2019, thus making the daily essentials marginally expensive.

It is essential for you to maintain additional financial options to deal with such inflation, which is where financial tools such as credit cards can help you.

Credit cards allow you make purchases and transactions on a pre-determined line of credit. These are helpful to manage temporary shortage of funds. You can also cater to financial crunches in businesses like working capital deficiency, procurement of raw materials, etc. with a credit card.

However, debts on credit cards can accumulate drastically upon non-payment of the bills within the due date. Nonetheless, there are specific ways in which you can manage your credit card debt, such as:

Cut your expenses-

The first step on how to repay your credit card debt is to cut down your expenses. Lower your cost of living so that you have ample funds in hand to clear your credit card debt. Analyse your daily necessary expenditures and search for areas where you can spend less. Refrain from easily avoidable expenses to accumulate enough funds for the credit card bill.

EMI conversion-

Credit cards include options which allow you to convert high scale purchases into easy-to-pay EMIs. If you have to make purchases despite a substantial amount on your credit card, convert the amount into EMIs to transfer the credit across multiple months and statements.

Debt consolidation-

You can consider availing a debt consolidation loan with low interest to clear your credit card debt completely. Credit card dues come with high interest rates in comparison to most other financial tools and products. Repay your dues with the loan and avoid paying the high interests.

Balance transfer-

You can consider transferring from your high-interest debt credit card to a lower interest rate credit card. This would help you avoid incurring high interest rates and help you repay more easily.

Plan your finances-

If you know how to use a credit card wisely, you should know to avoid utilising multiple cards at once. However, if you own multiple cards and have defaulted on the payments, make sure you plan your finances to help clear the debt. Analyse the amount you have in-hand and try to clear the credit card debt which will incur the highest amount of interest first.

Check your dues and interest-

Enquire about the interest rate that is being imposed on your debt along with the grace period. Apply for credit cards with low-interest rate so that it does not become a burden on your pocket. There are several financial institutions and NBFCs that offer online credit card at a low-interest rate.

There are several financial institutions and NBFCs like Bajaj Finserv that provide attractive offers along with an online credit card application process. Bajaj Finserv has introduced Bajaj Finserv RBL Bank SuperCard which offers several benefits like interest-free ATM cash withdrawal, welcome rewards, robust security, instant approval, and many more.

Bajaj Finserv has also introduced pre-approved offers that make availing these credit cards simple and help you save time. Pre-approved offers are also available on secured loans like home loans and unsecured loans like business loans and personal loans along with several other financial products and services. You can check your pre-approved offer by providing minimal details like your name and phone number.

Paying off your debts on time will help you maintain your CIBIL score. Many cards offer discounts on online credit card transactions. Take these discounts into consideration while using your card to reduce the credit card dues.