How to earn money from credit card?
No!! I am not a credit card salesman who pesters people with free lifetime cards or entices them with special gifts to buy more cards, and gets them into a debt spiral while I earn my commission on the way to the bank. I earn
I am just a common man who swipes my card day after day, at groceries, at petrol stations, at supermarkets, and to pay bills!
Over a period, I’ve developed a few habits (or incorporated “best practices”) with my credit card use, which have not only helped me avoid a debt spiral; But earn money from it too!! Read on to know how!
How to earn money from credit card?
Indians are the most resourceful people globally because of their ability to make money from virtually nothing. Indians can adapt to any situation and still succeed in it. This explains why Indians have not felt the brunt of the Covid 19 pandemic despite the economy falling at record levels. Indians come up with creative ways to make money. Let us discuss some of the best ideas to earn money using the best shopping credit cards in India.
Top five credit cards offered in India
Before we discuss the exciting ideas to make fast money with credit cards today, here are the top five credit cards offered in India.
- Axis Bank Ace Credit Card – Get 5% cashback on bill payments through GPay without any limit. Scratch card rewards help you earn extra cash back when you use G-Pay. Use the card on Ola, Swiggy and Zomato to get 4% cashback. Get 2% cashback on other payments.
- Flipkart Axis Bank Credit Card – You get unlimited cashback on using this credit card. In addition, a 20% discount is available on dining expenses. In addition, the range of welcome benefits enables you to recover the card charges levied by Axis Bank.
- Simply CLICK SBI Credit Card – You can easily pay your utility bills using this card. Also, get exciting Rewards Points on using the card at leading sites.
- HDFC Millennia Credit Card – Up to 5% cashback is available on every spend on this card.
-
American Express Smart Earn Credit Card – Zero lost card liability feature is the main attraction of the least expensive American Express credit card in India.
How to earn money from these credit cards?
How to earn fast money today using these cards?
Here are exciting ways to earn money using these credit cards.
1. Avoid paying interest on your credit card!
The first step towards making money with credit cards? Avoid paying interest on your credit!
Many cooks spoil the food!
That’s how too many cards spoil your development!!
You have a strict limit on the number of credit cards; and your overall credit limit.
Your overall credit limit (including all cards) should not exceed your monthly income; Otherwise, you will find it difficult to clear your next credit bill.
2. Avoid cash and debit card transactions as much as possible
The most creative way to earn money is by using these credit cards for your essential purchases. So, even if you pay an electricity bill of Rs 5000, you still get Rs 250 as cashback. So, in effect, you have saved on your utility bills. And saving money is also one of the best ways to earn money.
Typically, all these Best Buy credit cards offer cashback on fuel purchases. But, in addition to this, you get exciting incentives like fee waiver, free movie tickets, travel, dining vouchers etc., which contribute to saving money and thus increasing your income.
Next time you buy mobile phone or monthly grocery from the store, avoid paying cash, instead pay with credit card.
Firstly, it helps to avoid black money to a very small extent. Second, and more importantly, your money stays in your account until you make a credit card payment (though not for debit cards).
It gives you additional interest on your savings account balance. sounds petty?! Not necessary!! let me explain…
The following are the key takeaways from the recent RBI decision on savings account interest rate:
RBI deregulates savings account interest rates; Hence, the competition among banks is heating up to increase the rates further (one bank has already raised the rate up to 6%!!!)
Savings account interest rate is currently 4%
The rate will be calculated at the end of each day, rather than the lowest balance a month in advance (most of our account balances are lower by the end of the month 🙁 )
So, if I withdraw using my credit card on 1st October Rs. 30,000 iPhone, my credit statement will be ready by the end of the month.
So, this 30 thousand rupees will remain in my account till I make the payment at the end of the month. At 4% interest rate, this works out to close to Rs.100/- per month (@4%, every Rs.10, 000 earns an interest of Rs.1.01 per day!!!)
So, it is extra money as interest from your purchases!!
Note: Before swiping, make sure that the seller does not charge any service charges; Most don’t, but it’s always safe to confirm.
When using for fuel, choose banks that have a tie-up with your credit card company so that you don’t have to pay surcharges.
3. Earn Credit Card Money by Paying Your Credit Card Bills on Time
Do you know that you can earn money by paying your credit card bills on time? are you surprised? Yes it’s possible. Here’s how you can do it.
All credit cards offer a maximum interest-free period of around 45 to 50 days. The system works like this. Every credit card has a specific billing and payment date. The payment date is usually 15 to 20 days after the billing date. So, if you use the card for your purchases after the billing date, you need not pay for it till the next payment due date.
For example, if your billing date is the 5th of each month, the payment date will be approximately the 25th. Hence, the bill generated on 5th May 2022 includes all purchases made on the card till 5th May 2022. Then, the bill amount has to be paid by May 25, 2022. Suppose you buy a TV worth Rs 50,000 on the card on 6th May 2022. The same will reflect in the bill generated on 5th June 2022, you have to make the payment by 25th June 2022. So, you get an interest free period of 51 days on Rs 50,000.
In monetary terms, this translates to Rs 2515 as banks charge interest at the rate of 3% per month on credit card dues. Hence, this saving in interest is indirect income.
However, it would be better to know that this benefit of interest free period on credit cards is available to those who pay their bills in full and on time. This is not available if you make a partial payment. Hence, the interest free period is an incentive to pay your credit card bills on time.
4. Delay the payment of your credit card bill till the last few days
This is the next important step in making money with credit cards – Pay the bills on time!! Earlier, I used to pay my credit card bills immediately after making purchases. But, as I realized how much I could earn with the additional interest, I delayed my payment till the last days. If my due date is the 15th of the month, I don’t pay until the 13th or 14th; So that I can earn interest on the savings account even during the grace period. With Net Banking & Mobile Banking, payments are cleared in seconds, so no worries about check clearing on time or on national holidays!!
5. Negotiate to extend your credit payment cycle
By now you must have understood that the longer the grace period, the more you can delay the payment; You can earn more interest. So, talk to your bank and try to extend the grace period. Recently, I upgraded to a high-end card, and my grace period extended to 10 days. Now, my half yearly interest credits keep piling up!!
6. Reward Points
Of course, it’s always a pleasure to earn reward points for your purchases and cash them in for exciting gifts!!
By using the CRED app to pay your credit card bills, you can earn substantial income in the form of cashback, CRED points, bonus offers and exciting discounts on various merchandise.
7. Discipline is essential
Final step towards making money with credit card? A disciplined approach is of great importance while using a credit card. Better than paying more interest after the due date, make sure you set reminders on your handset so that you don’t miss the payment dates!
Be careful about small amount but don’t be fool for big amount!!
And always keep an eye on your spending. Having a credit card is not a license to go on a shopping spree.
The richest are not those who earn more; But those who spend less.
Plan your monthly budget, and try to stick to it.
Avoid impulse buying – When you go shopping, don’t buy more than you plan to. Also, inculcating the habit of saving will yield good returns in the long run. Try these tips and your credit card will soon be earning extra credit card money!
Happy swiping!!
How to earn money from credit card? on frequently asked questions
✔️ Which credit cards have the best rewards?
Determining the best rewards card for you depends on what types of spending you do most and the type of credit card rewards you prefer. Some cards, like the Axis Bank ACE Credit Card, are ideal for earning more cash back for casual spending. Others, like the Citi PremierMiles Credit Card Travel Rewards Card, are best suited for people who travel frequently.
✔️ How do you maximize Credit Card Rewards?
To get the most out of your credit card rewards, it can be helpful to have a few different types of rewards cards. Try combining a good travel rewards card, an all-around cash-back card, and one with special rewards categories that fit your spending habits.
✔️ How do you redeem Credit Card Rewards?
Each Rewards Card has its own options for redeeming Rewards. You can have the cash-back rewards deposited directly into your bank account or sent via paper check. Some cards give you the option of redeeming rewards for credit towards your balance. In some cases, you may be able to spend Rewards directly with various online vendors. Review your rewards card’s terms of service for more information on redemption options.