Credit cards are versatile financial instruments that simplify your life. With these cards, you can buy items that you need on credit. Most of these cards offer a rewards program, including cashback, points, air miles, and exclusive perks. However, to get maximum rewards, you should use the card in a disciplined manner.
The right use of a card not only improves your purchasing power but also offers benefits that upgrade your lifestyle. Here are some quick tips for using a credit card in UAE like a pro.
How Can You Maximise Credit Card Rewards in UAE Efficiently Now?
1. Use a Credit Card that Aligns with Your Budget
To make the most of the benefits and rewards on your credit card, create a budget. Once you build a budget, maintain it while making purchases. You can use the card for daily expenses like groceries, fuel, and utility bill payments.
Preparing a budget can help you avoid excessive spending and maximise the rewards. The rewards/cashback you get on your card can be redeemed on future purchases.
2. Spend Based on Category
Use credit cards with higher cashback or reward points and spend on eligible categories like fuel, travel, dining, or groceries. Spending on these categories can help you earn offers and even add additional rewards on your card.
3. Look for Welcome Bonus/Benefits
Check out cards with welcome bonuses like rewards, air miles, cashback, and vouchers on signing up for the card. This way, you can save on big purchases.
Note that since no 2 cards have the same perks, you should check all the options available. This can help you find a card that aligns with your lifestyle and spending patterns.
4. Pay Credit Card Balance in Full
Unlike popular opinion, pay the balance for the cycle in full. This way, you can avoid late payment interest and penalties that are usually high. Furthermore, when you pay your bill on time, your creditworthiness improves.
5. Keep Your Credit Utilisation Ratio Low
Keep it below 30% of your available credit limit.
For example:
Your total credit card limit is AED 50,000. Here, try to use only up to AED 15,000 of the available limit. A higher credit utilisation ratio negatively affects your credit score.
6. Understand the Benefits of Your Credit Card
Most cards offer rewards such as cashback, air miles, vouchers, points, and discounts. To make the most of them, understand how and where you can use these rewards. Go through the benefits in the fine print and eligible spending to earn the rewards.
7. Redeem Reward Points
You earn rewards by using your card. These rewards can be redeemed to purchase products on partner websites or stores, or converted into cash or points. Also, track the accumulated points and redeem them before they expire.
8. Avoid Withdrawal of Cash Using Your Credit Card
While you can withdraw cash from your credit card, experts recommend against it. It is so because you can face a withdrawal fee. Additionally, some banks levy interest on the withdrawal right from the time you withdraw the cash.
9. Upgrade Your Card As Per Requirement
Based on your requirement and salary upgrades, you can upgrade your credit card. This can help you earn higher rewards, complimentary perks, and even cashback. Premium cards come with perks like airport lounge access, golf access, or free vouchers.
10. Consider the Joining Fee and Annual Fee
Several cards in the UAE charge a joining fee and an annual fee, while some cards have zero charges on the annual fee. Compare credit card benefits against these charges. For maximum benefits, choose a card with low fees or one with no annual fees.
11. Don’t Forget to Compare Credit Cards
Experts say that never settle for the first credit card recommendation you get. Always compare your options. There are third-party aggregators like Paisabazaar.ae that help you compare and get personalised credit card recommendations as per your needs, income, and lifestyle.
While credit cards offer convenience, protection, and rewards on your purchases, there’s always a risk of high interest, hidden fees, and overspending. To make sure that the risks don’t outweigh the benefits, use your card strategically.
