This year, the global credit card market is expected to reach $102 billion compared to $99.08 billion in 2021. This rising demand and ownership is a result of people wanting to reap the benefits of having a credit card. To add, it’s one of the safer and more convenient ways to have money on you. But aside from this, credit cards offer a lot of value—especially in 2022.
Let’s take a look at some of the benefits of having a credit card today:
To get better security
Payment frauds increase yearly. CNBC reveals that $5.8 billion was lost to fraud in 2021—up by 70% compared to 2020. With this trend, 2022 will be no different.
Luckily, fraud can be avoided when using credit cards. They come with zero liability protection, meaning you won’t be held responsible for unauthorized purchases as long as you report them. In contrast, debit card funds are taken directly from a checking account, giving perpetrators instant access to your money.
Your purchases are safer, too. If you used a credit card to buy something and it never arrived or was damaged upon delivery, approaching your credit card issuer to dispute the charge is possible. Unlike debit cards or cash, you only have the retailer’s return policy to back you up in similar circumstances.
To build your credit score
Mortgage lenders and banks are now requiring higher credit scores compared to pre-pandemic times. Their standards were tightened because of the rapid economic changes that occurred. For example, Federal Housing Administration loans now require a minimum credit score of 500 and 580 for maximum financing.
One of the easiest ways to build credit is through a credit card. AskMoney lists a few ways to increase your credit score, including paying your dues on time and asking for a higher credit limit. Setting up auto-pay is useful for paying bills on time. Increasing your credit limit will also benefit your credit score as long as you don’t actually use the additional credit you’re granted. Doing these gets you a great credit score in no time, allowing for many advantages like easier renting and getting the best insurance rates.
To earn rewards
Credit card rewards are changing for the better this year. Because traveling is opening up again, many airline and hotel loyalty programs made it easier to earn points via spending with credit cards. For one, Chase Bank allows users to transfer points 1:1 to their airline and hotel partners.
Aside from travel rewards, credit card holders can also look forward to cashback for eligible purchases and points that can redeem gift card merchandise, and the like. These rewards are mostly the same across all issuers, though they may differ in offers, redemption periods, and expiration. Still, it’s a benefit that you cannot get when using cash or debit. It’s something unique to credit cards alone and it’s earned simply by spending.
To adapt to cashless payments
Cashless payments have been on the rise in recent years. The Future of Commerce even reports that cashless societies are most likely to be established soon. In fact, Sweden has been predicted to become the first cashless society by March 2023.
With this change in the financial world, adopting cashless payment options is more important than ever. Further, they are also perfect for online transactions like bill payment and online shopping, adding to your convenience.
With the many advantages of having a credit card, make sure you get one as soon as possible. As we’ve discussed in our article ‘Better Financial Habits That We Could All Benefit From This Year’, it will be the best financial decision you make.