Smart way to use Credit Card.

[sandeepverma]

Credit Card is need of today when Social Media friend are not ready for help online, it can turnout to be a very good friend. However a smart person can only use it wisely. Following are tips for smart use.
1) Always check your monthly statement using transaction and payment history, available for you by logging in to your account. Chech that every transaction in monthly statement is duely recorded in transactiom history or every transaction entry in history is accounted for in monthly statement. Any mismatch is required to be informed to Card Company. If you are using it quite often, then every week you should check it.
2) Use only 70-80% of credit limit, as use after that will reduce your rating.
3) Only in rare case opt for EMI or Flexipay option, as its moratorium schedule is not available to you. So it may create confusion while checking your statement.
4) Pay your dues before time and in full. If any EMI is accounted in Due then whatever less is paid is treated as default in EMI and penalty @18% in amount due, which is 216%per annum, if due is kept for one year, is imposed and credit rating too lowered.
a) As per my information if a person has already taken
(1) a loan of Say Rs2,00,000/- on Kisan Crdit Card and
(2) made purchase worth Rs 2000/- in a particular month,
and his Total Amount Due as per monthly statement is Say for example Rs5000/-
in which loan component (Principal) + other charges including interest and tax on interest, if applicable, is Rs 3000/- and he/she pays Rs4000/- only then it is considered as Rs 2000/- towards purchase and Rs 2000/-then first of all interest and tax is considered as paid and remaining amount only towards actual loan principle and then for remaining default is on principle amount. So the penalty is for not paying the Principal amount due for the loan. It may vary as in VISA cards it is maximum 18%+ tax, of unpaid amount.
As per my information, please check detailed rules of your Card company,
when a Kisan Credit card is used for taking loan for agriculture then its insurance is also included in loan, because if you are capable of growing crop yourself then you would have not taken loan using Kisan Credit Card at all! Due to this insurance amount paid is treated as "Paid by Credit Card company" to the "Insurance Company".
Now if a farmer has defaulted in paying monthly amount due for few months and his crop too is damaged then whatever claim is due to be paid to the farmer for crop loss is treated as claim of the Credit Card company who paid the insurance premium and loan to the farmer and remaining amount, if any, is paid to the farmer. So if a farmer goes on defaulting his monthly payment and then his crop is also damaged due to nature then from compensation received from insurance company first of all "All defaulted payments + Penalty on them" is first of all recovered and then Principal amount defaulted and then remaining will be paid to the farmer. So if a loan is taken on Kisan Credit Card, it is wise to pay monthly due on time and fully at any cost so that in the even of crop loss he/she can receive full amount from insurance company.
5) Use of Card for online payment attract 5% charges(for amount exceeding some limit in case of VISA cards in India), so unless a discount of minimum 5% is offered it is wise not to purchase it. If you are purchasing/paying online a certain applicable amount each month then it turns out to be 60% per annum for paying by card. (Corrected as per YGuliya ji's suggestion below)
6) Hide CVV of your Card, on the back of your card, using a small black tape and never share it. Take caution not to handover it to anyone. Hide the keyboard while entering your PIN on card swipe machine.