All credit card users will be excited when they receive calls from the credit card company saying that they are giving an offer to upgrade credit card. In fact, this credit card upgrading is a reward for disciplined repayment of the credit card bills and utilisation of the credit card. Irrespective of the reason behind the offer made by the bank, upgrading the credit card offers many benefits to your pocket. Let’s read the article to know how credit card upgrade will benefit you more.
Needless to say, that the primary objective for upgrading the credit card is increasing the limit. The credit card company makes an offer to the customer based on your credit utilisation. If you have taken your first credit card as an offer that comes on your way, credit card limit might be low. If you are exhausting your credit card limit every month, it may impact your credit utilisation ratio. If you are facing this scenario for a while, increasing the credit card limit acts in your favour. With the increase in the credit card limit, your credit utilisation ratio will decrease which will have a positive impact on the credit score.
Rewards and offers plunge
Apart from increasing the credit card limit, card upgrade will bring more rewards and offers in. If you are using the cash back currently, you can upgrade card to bag air miles if you are a frequent overseas traveller. You can also choose to upgrade to fuel card if you are travelling on car frequently. You may not check for the benefits of your first credit card as it comes free with your savings account but, when you are upgrading the credit card, you can prioritise the offers you like before upgrading. Make sure you think twice before choosing to upgrade the credit card to enjoy more offers.
Easy loan approval
You may be surprised to hear that your credit card will help to smoothen your loan approval. As you might be aware good credit score is very important for loan approval, high credit limit will help in building your credit score thus impacting your loan approval from the bank.
Good money management
Most of the people argue that high credit card limit will tempt for the impulse purchases. On the contrary, they can help you in learning the money management in a better way. The billing cycle of the credit card may happen at the end of the month, while the billing cycle of the upgraded credit card will fall in the middle of the month. These changes in the billing cycle of the credit card will help manage your finances effectively if you are serious about keeping away from late payments and being punished with late payments and high rate of interest on the outstanding balance.