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11 Reasons Why Credit Cards are Important For You

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Created on
November 11, 2022


What’s Inside

Credit cards are often underestimated and, at times, vilified. But they can significantly improve our financial lives when used correctly. Moreover, they offer a range of rewards and benefits that make using them highly rewarding. If you're still contemplating needing a credit card, read on.

Maximise Your Money


When used regularly, credit cards offer a range of rewards. These rewards are usually in the form of reward points, airline miles, or cashback, depending on the type of card you get. For example, you can save a lot with travel-oriented credit cards by redeeming the accumulated reward points or airline miles.

‍Welcome bonus

Sometimes, you can save money when you get a credit card as you may get a 'welcome bonus'. These bonuses may arrive in the form of: free event tickets, movies or flights, discount vouchers, or even gift vouchers.

‍Buy Now and Pay Later (BNPL)

All credit cards come with an interest-free period ranging anywhere from 22 days to 52 days. It allows you to use the card to purchase products and services — and pay for them later! It'll help during emergencies and when you're short on funds.

Here's how it works: Say that the interest-free period on your credit card is 52 days from the start of a billing cycle. Due to this interest-free period, if you use your card to purchase a product on the first day of a new billing cycle, you can pay for it 51 days later.

The Power of Credit Cards

Insurance coverage

Some credit cards come with insurance coverage. Depending on the card, you may be eligible for purchase protection insurance, personal accident insurance, or both. P.S. You don’t have to pay any insurance premiums!

Access to emergency funds

Most credit cards instantly allow you to avail a small loan against the assigned credit limit. It can immensely help when you need funds for an emergency. The best part? The process is straightforward and ideally takes only a few minutes.

EMI plans

Many people think credit cards are just another way to make payments. However, you can use a credit card to convert big-ticket purchases into smaller, more manageable EMIs (monthly instalments). Using the balance transfer feature on your credit card, you can consolidate your debts and reduce the impact of interest. Here's how you can calculate your credit card EMI.

Builds credit history

When you apply for a loan, some key metrics financial institutions look at are your credit history and credit score. Individuals with a long history and a good score tend to get more favourable loan terms. A credit card offers a way to build a credit history and increase your credit score.
All transactions you make using a credit card, including purchases and repayments, are logged and reported to credit rating agencies, which creates credit history. All timely repayments — made consistently over the years — boost your credit score.

Why You Can't Afford to Ignore Credit Cards

Quick Digital Transactions

One can use credit cards for digital payments. All online shopping websites accept credit cards as a form of payment. Digital transactions are far more convenient and quicker than transactions involving cash.

Safety and Security

If you’re still wondering why you need a credit card, you can make safe and highly secure transactions online (and offline) with a credit card. In the case of offline transactions, you need a secure four-digit PIN associated with your card to authorise payments.

Similarly, online payments need a One-Time Password (OTP) sent to your registered phone number. Thanks to these multiple security steps, it is very tough for unauthorised individuals to use your card.

Works Universally

If you’re a frequent traveller, then you must get a credit card for yourself right away. One of the many benefits of a credit card is that it can be used virtually anywhere in the world to make payments. It single-handedly eliminates the need to convert cash each time you travel.


Between BNPL, EMIs, access to Emergency Funds, & building a credit history — you probably understand the importance of a credit card. So, if you don’t have one already, now may be the right time to apply for one. However, before you go ahead with your credit card application, compare multiple cards with one another. It will allow you to choose the one that fits your requirements.

Benefits of the Fi-Federal co-branded Credit Card!

If you're looking for a credit card that gives you the best bang for your buck, the Fi-Federal co-branded credit card is what you need. With this card, you're assured of a 2% valueback through rewards. But that's not all, as you'll also get 5x on your top 3 brands, 2x on all partner brands listed in the Fi Catalogue (including Amazon, Netflix, etc.) and 1x on everything else, including rent and fuel. What's unique is that you earn points through Fi-Coins. For travellers, the perks are even better, as you can convert your Fi-Coins to airline miles or cashback.

But that's just the tip of the iceberg: you'll also enjoy airport lounge access, 1% forex, the freedom to choose your billing cycle, and personalised reminders. Oh, and the welcome offer includes exclusive vouchers from top brands worth ₹5,000!

Frequently Asked Questions

1. Is having a credit card a good idea?

Of course. Getting yourself a credit card is the best financial decision that you can make. It offers so many benefits, and when used responsibly, it can help you manage your finances much better.

‍2. What are the 3 benefits of having a credit card?

Three of the most important benefits you enjoy are getting yourself a credit card and the ability to buy now+pay later, the various rewards you’re entitled to, and the ability to build and improve your credit history and score.

3. Are there any drawbacks to credit cards?

*High-interest rates can lead to debt if balances aren't paid in full.
*Overspending is a temptation, so budgeting is crucial.
*Credit cards may have fees, impacting costs.
So always pay your credit card bill on time & monitor your statements. By understanding and taking precautions, you can enjoy credit card benefits while minimising drawbacks.

4. What are the benefits of using credit cards for everyday purchases?

Convenience, building credit history, rewards, and benefits are some of the key benefits of using credit cards for everyday purchases.

5. Are credit cards safer than carrying cash?

Yes, credit cards are generally considered safer than carrying cash. Carrying cash can make you a target for theft or loss, and if it's stolen, it's difficult to recover. Credit cards, on the other hand, offer fraud protection, and if your card is lost or stolen, you can report it and limit your liability for unauthorized charges.

6. What role do credit cards play in establishing a credit history?

Credit cards play a significant role in establishing a credit history. By using a credit card responsibly, making on-time payments, and keeping credit utilization low, individuals can build a positive credit history.

Want to know more?


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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