How Should You Use Credit Card amidst the COVID-19 Crisis?


The coronavirus pandemic has caused financial and personal distressto people across the country. Many people have lost their jobs whilemany others have become subject to substantial pay cuts. As the Indian economy suffers from the ill-effectsof Novel Coronavirus, manypeople are also struggling to manage their finances. To ease financial pressure, RBI issued a notice regarding moratorium period that has now been extended up to August 31, 2020. The moratorium has been extended to loan bearers and credit cardholders.



Many people are also resorting to the useof credit cards to meet theirmonthly expenses.Although it may seem easy to use a credit card to fill the gap between income cut and expenses with the moratorium in effect, you must be carefulas it can affect your CIBIL score.

Rules to Follow for Using Credit Card During COVID-19

  • Keep an Eye on Your Credit Score

Although RBI has put in place moratorium for loan bearers and credit card holders,you must still keep an eye on your credit score. A moratorium is a deferment under which you do not have to pay any amount towards your loan or outstanding creditsfor a specific period.While the moratorium period may not have any such effects, it is still imperative to pay your pending dues on time to improve it further. High credit score will also help you get a low rate of interest if you plan to apply for a loan in the future.

  • Check Your Credit Reports

Credit reports give information about your pending credit card dues, current CIBIL score, active accounts, and similar other details.You can check your monthly credit report to know these details and improve if there are any lags. Keep in mind to not share your credit information with anyone unless it is asked directly by your bank where you are present physically.

  • Pay Your Credit Card Debts as Soon as Possible

Many factors define your CIBIL score. Ithighly unlikely to have a high credit score with significant debt. You should try clearing your pending dues within this moratorium period to boost your CIBIL score. However, if you are not able to make any payments due to reduced or no monthly income, do not make unnecessary expenses through your credit card.

  • Use Contactless or Digital Payment Methods& Update Your Budget

Contactless cards have been around for many years now. If you own one, make payments using them to minimise risk, especially during a pandemic. It is one of the safest ways to shop. You can also use your credit cards for payment through digital wallets or apps. India has many reliable digital payment apps where you can enter card details to shop almost everywhere – be it a grocery shop or a high-end store.

Apart from this, you should also look at your budget and redefine it to avoid spending unnecessarily. Since these are unprecedented times, almost all extra expenses need to be avoided. Try to maintain this rhythm every month.


Tips to Use Credit Card During COVID-19 Pandemic

  • Manage your memberships and subscriptions to avoid extra expenses. Set a reminder to cancel all monthly subscriptions that you don’t require at the moment or for which you opted for a free trial.
  • Use the right credit card that rewards you upon its use. For instance, many credit cards offer various EMI benefits, reward points or special discounts when you shop online through Amazon or Flipkart.
  • Stock up essentials for only a few weeks as hoarding food can turn into a nightmare when it starts getting stale. Avoid unnecessary purchases through your credit card. It has already become easier to access most of the things with Unlock 1.0apart from containment zones. Make wise purchase decisions while using a credit card.
  • Pay off your bills on time, including your credit card bill. RBI may have offered an option of moratorium period, but you should pay your credit card bills if you have a regular income. It is only beneficialto opt if you have lost all income sources.

Use Your Credit Card Wisely While Shopping

A credit card can boostyour urge to shopimpulsively. However, unnecessary expenses must be avoided at all costs, especially when the entire country is fighting a pandemic.Many people are struggling to meet routine expenses because of various factors. If you require a little financial boost, you can get credit cards from reliable banks like Axis bank.They provide one of the best credit cards, along with various other offersto suit your needs.

Our country might have to accept this new state of affairsat least for a while,till things are truly back to normal. Till that time, remember to manage your expenses wisely. Use your credit card to make essential purchases and stay indoors,stay safe.