Essay on the Advantages and Disadvantages of a Credit Card

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Table of contents

  1. The Advantages of Credit Cards
  2. The Disadvantages of Credit Cards
  3. Conclusion

Credit cards is a plastic card that lets you pay for goods or services and can be paid for either at the end of a set period which is normally a month. The minimum payment will be a percentage of the balance on the credit card. It is suitable for buying goods or services. It is also used for convenience and safety as an alternative to using cash.

Credit cards, also known as plastic money, have seen a significant increase in usage worldwide since their introduction. At the beginning of the twentieth century, credit cards were first issued in the United States. Since then, they have become very popular in many countries around the world, and credit cards are the primary system for facilitating transactions or payment exchanges for household and personal expenses.

The Advantages of Credit Cards

The advantages of credit cards are that it is easy to use, you could pay above the minimum rate if you want to and hence speed up the rate of repayment and reduce interest incurred. It can be used for any item no matter how big the value is, and it provides some protection on purchases.

Also, they’re a great way to build credit. Each time you open a new credit card account, the lender reports that activity to a credit reporting agency. They’ll also report if you miss a payment or are frequently late paying your monthly installments.

Credit cards are more secure than cash. They are used frequently—even by people who have access to cash—because they offer another level of security.

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Many credit card companies offer rewards such as cash back or airline miles for using them regularly. If you use a credit card for routine expenses, these rewards can add up quickly.

The Disadvantages of Credit Cards

The disadvantages of using a credit card are that it can encourage overspending which will lead to a bad habit, you could make unnecessary purchases which would also lead to debt problems.

Although credit cards are convenient, the cost of borrowing is typically much higher than with a traditional loan.

Applying for too many credit cards can damage your credit. Several factors impact your credit score, including payment history, current amount owed, length of history, new credit, and types of credit used.


I certainly think that using credit card are very useful as you can put money in there whenever you want and spend the money when or wherever you want. You could use it online as well. As long as you don’t become addictive to overspending, it will be a great way of delaying payments and it is simple to use.

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Essay on the Advantages and Disadvantages of a Credit Card. (2022, August 25). Edubirdie. Retrieved April 13, 2024, from
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