4 Benefits of using a credit card or store card to spread costs

It’s great to settle your bills with a debit card because you’re relying on money that you already have. However, by swapping this out for a credit card or store card every now and then, you will be able to reap additional benefits that debit cards don’t offer.

In this article, we have a look at four ways in which a credit card or store card can help you spread your costs in order to gain more benefits.

Certain credit cards and store cards offer interest-free periods. This means that you can purchase an item and, if you pay it back within this period, you won’t have to pay any interest on it.

This isn’t an advantage over using a debit card because they don’t charge any interest on a purchase. However, the interest-free period allows you an opportunity to utilise the other benefits of credit cards and store cards – without costing you a cent more than a debit card.

Many credit cards offer 55 days interest-free and store cards often offer 6 months interest-free. However, this depends on the particular card in question.

When you take out a credit card or store card, part of your contract will include credit life cover. This insurance kicks in if you experience a life-changing incident. For example, if you become paralysed and you cannot work for several months, your credit life cover will pay your monthly instalments.

The monthly premium for your cover is paid alongside your instalments, and it usually amounts to a small percentage of the amount you owe. According to the National Credit Act, you cannot be charged more than R4.50 for every R1,000 you owe.

Make sure you read your credit agreements thoroughly so that you understand under which circumstances you will be protected. It’s also within your rights to substitute your credit life cover with a provider of your choice – as long as your lender is covered for the same amount.

If you make your credit card and store card payments on time and in full, you should see an improvement in your credit score. This shows lenders that you can manage your credit well, so they’ll see you as less risky to lend money to.

From applying to car finance to taking out a home loan, a healthy credit score will give you access to better offers that may save you money. If you make sure you meet your monthly instalments, you will be able to watch your credit score grow before your eyes.

We use the information in your credit report to personalise your offers. The cards you see on ‘Your Offers’ page on ClearScore is sorted by what’s relevant to you and not what’s best for our pockets.

You don’t worry about having to wait – some cards come with instant access, so you’ll be able to pay with a virtual card soon after you’re approved. This means that you can seal the deal straight away.