Credit Card Tips: If you also buy gold with a credit card, then keep these things in mind; otherwise, you will incur huge losses..

Gold is considered a safe investment. Especially in India, people buy a lot of gold. Earlier, only cash was used in the bullion market to buy it. But, due to changes over time, now you can also buy gold with a credit card. It is easy to buy gold with a credit card, but it has its advantages and disadvantages. In this news, we are going to tell you about the same advantages and disadvantages. Let us know what things you should keep in mind while swiping the card.

According to CA Praneet Jain, Director of FPA Edutech, in a Mint report, credit cards are suitable for disciplined people who pay on time. If you are unable to do so, be prepared to bear the burden of 36-42% annual interest, late payment fees, GST, and other charges. Accumulating reward points is an attractive aspect of credit cards, but not paying on time can lead to huge regrets. Therefore, avoid investing with credit cards. Talking about the advantages and disadvantages of buying gold with a credit card, let's understand that, too.

Benefits of buying gold with a credit card

Buying gold with a credit card offers many attractive benefits, like reward points and cashback. Famous brands like Zoya, Tanishq, and Reliance Jewels offer up to 5% cashback or reward points on the purchase of gold with a credit card. For example, Titan SBI Credit Card offers up to 3% value back on gold purchases from Tanishq and up to 5% cashback on other select jewellery brands. Apart from this, cards like Standard Chartered Ultimate Credit Card and HDFC Regalia Gold Credit Card also offer reward points on gold purchases, which can be used for discounts or other benefits in the future.

Disadvantages of buying gold with a credit card

The biggest disadvantage of buying gold with a credit card is the processing fee, also known as the swipe fee. Each transaction may attract a fee of 3.5% or more. Gold prices are already quite high, and this additional fee can further increase the financial burden on buyers. If you buy gold from international gold sellers, you may also have to pay foreign transaction fees. Apart from this, it is important to get complete information about the latest offers, terms, and rules of your card provider before buying gold with a credit card to avoid risks.

Ban on buying gold with a credit card.

There are some restrictions on the use of credit cards for buying gold. Since 2013, financial institutions and banks have been prohibited from providing EMI facility for the purchase of gold. This decision was taken to preserve the country's gold reserves. Under this, credit card payments are also not allowed for the purchase of gold coins at bank branches. These rules apply mainly to gold coins, but they do not have much impact on the purchase of jewelry. However, some banks have removed the EMI option for jewelry purchases. Therefore, it is important to know the new policies, rules, and updates of the bank before buying gold with a credit card.

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