credit cards

Front

What is a credit card?

Back

A credit card is a plastic card issued by a financial institution that allows the cardholder to borrow funds to pay for goods and services, with the agreement to pay back the borrowed amount plus interest.

Front

What is the main advantage of using a credit card?

Back

No need for carrying cash.

Front

What should you do as a borrower?

Back

Pay back your loans promptly.

Front

How do credit card companies make money?

Back

By charging late fees and interest to their customers.

Front

What is the relationship between credit cards and loans?

Back

Charging a purchase with a credit card is like getting a loan because you borrow money from your credit provider.

Front

What is an annual fee in relation to credit cards?

Back

An annual fee is a charge that credit card companies impose each year for the use of the card.

Front

What does it mean to use credit with extreme caution?

Back

It means to be careful about how much you borrow and to ensure you can pay it back to avoid debt.

Front

What is interest in the context of credit cards?

Back

Interest is the cost of borrowing money, expressed as a percentage of the amount borrowed.

Front

What is a credit limit?

Back

A credit limit is the maximum amount of credit that a financial institution will extend to a borrower.

Front

What happens if you miss a credit card payment?

Back

You may incur late fees, and your credit score may be negatively affected.