Use credit card with discretion: Here're fees, charges and penalties

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  • Treat a credit card as a convenient means to pay and not as an efficient way to borrow
  • Understand charges, fees and penalties (See table) and avoid taking excess debt
  • The most common reason for the build-up of debt is that borrowers make only partial payment or pay only the minimum amount due
  • The balance, then, gets added to the next bill and the combined amount attracts extremely high-interest charges 
  • Eventually, the cardholder has to pay heavy interest on the outstanding
  • Once in a debt trap, the only recourse is to take a personal loan to clear the debt or convert the credit card dues into equated monthly instalments

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