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Benefits of owning multiple credit cards

RBL Bank Nov 26, 2019
  • Multiple cards give you access to a large amount of credit
  • It helps you make the most of the interest-free period
  • You can also improve your credit utilisation ratio and credit score
  • Proves beneficial in case a card stops functioning

Offering an instant flush of liquidity to meet expected and unexpected needs, credit cards have evolved as a modern-day need. In fact, it’s uncommon among card holders to carry multiple cards.

There’s a misconception that multiple credit cards can spoil your financial habits and push you into a debt trap. When used wisely, having more than one card can spell these benefits:

Comes in handy when you need substantial funds

Every card comes with a certain limit beyond which you can’t borrow. When you’ve multiple cards, you get a large credit limit that comes in handy when you need a substantial amount of funds, particularly during the festive and wedding season.

With multiple cards, you don’t have to worry about the paucity of funds and dip into your savings. Multiple cards are also useful while addressing an emergency.

Make most of the interest-free period

When you transact using a credit card, you get an interest-free period during which you need to pay back the borrowed amount. The period starts after the end of the billing cycle and differs across card issuers. If you have a single card and use it at the start of the billing cycle, the number of days within which you need to pay back the amount is higher and vice-versa.

However, with multiple cards with different billing cycles you can make most of the interest-free period. For instance, if you have two cards whose billing cycle starts at 15th and 30th of a month, you can juggle between them to have more days at your disposal to pay back the amount borrowed.

Improves credit utilisation ratio and credit score 

Simply put, credit utilisation ratio is the outstanding credit divided by the limit of all the active cards. A low credit utilisation ratio improves your credit score. On the other hand, a high credit utilisation ratio can negatively impact your credit score as lenders may perceive you as a credit hungry borrower.

With multiple cards lowering your credit utilisation ratio and subsequently boosting your credit score, the same aids in availing loans at a competitive interest rate with a flexible repayment tenure.

Proves beneficial in case a card isn’t detected

There can be occasions when the point of sale (POS) terminal fails to read the magnetic stripe of your card. In such a situation, having multiple cards can prove to be beneficial as you can use your second card at the terminal and conduct the required transaction.

Thus, having multiple credit cards offer a range of benefits. To make the most of your card ensure you use them judiciously and pay back the outstanding amount in full within the interest-free period.

Click here to get an add-on RBL Bank Credit Card.

Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.

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