Learn about credit cards balance transfer and its benefitsLearn about credit cards balance transfer and its benefits
In the modern times, money has transformed into various forms drastically than what it used to be. In the the past, money was in paper and coin form. With time, people came up with more flexible ways of carrying money. Previously, the paper-made money faced problems to do with bulkiness. In addition, many dangers inhibited individuals who carried hefty amounts of money. Hence, checks came up as viable means of transacting business.
History
Consequently, checks faced the problem of bouncing and wearing out. Therefore, mankind faced little options with regards to safe money handling. Thus, the genius of human beings reared itself in the form of credit cards. Credit cards exist as plastic, square-shaped cards, which functions as modes of payment. In this case, people can make purchases at various premises using these cards. Subsequently, most financial institutions deal in credit card issuance. Moreover, they act as a forum for checking on the credit cards balance.
Additionally, the credit cards balance usually materializes after the issuer deducts their interest charges. Subsequently, there exist various benefits of owning a credit card. For instance, credit card holders can experience more convenience through short-term loans. In this case, owners can obtain loans at a faster period than their debit card compatriots. Moreover, most banks offer rewards for people who purchase credit cards at their centers. This scenario results in an increased credit cards balance.
Features
The world of banking has witnessed another transformation with regards to credit cards. The concept of credit cards balance transfer has enabled people to hold numerous credit cards at the same time comfortably, and transfer their credit cards balance in between the cards they hold. This procedure allows people to move their balance in one credit card to another credit card from a different company. People who engage in this phenomenon can then withdraw their credit cards balance from the second company.
Consequently, the process usually involves certain features. For instance, it contains a teaser rate, which posits as an inducement to the target market. It is a low rate that exists for the short term. Other features include the transaction fee and the balance transfer arbitrage. The fee constitutes the commission of the company overseeing the transaction. Notwithstanding, some individuals still have apprehensive tendencies towards this practice. Nevertheless, credit cards balance transfer offers numerous benefits for the holders.
Benefits:
- Spending of finances wisely through avoiding cash advances. The credit card balance in the teaser rate undergoes payment before any cash advances.
- Attain attractive incentives and rewards. The new credit card issuer will advance low interest rates and rewards for customers’ loyalty.
- Consolidate credit cards balance debt by integrating the numerous balances on various credit cards. Hence, reduce the minimum end-month payments and pay off the credit card balance instantly.
- Improving credit card reports by consolidating the numerous credit cards balances. Credit cards balance transfer helps to improve your credit rating in the eyes of lenders.
- Attract low interest rates to pay credit cards balances sooner than later. This occurs through the reduction of monthly payments.
