There will be no harm if you don't use it? Simply put, what happens if someone leaves a credit card?
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Once upon a time you had to burn a lot of wood to get a credit card. Now the process is simple. As a result, the use of credit cards has increased. Many companies offer attractive offers to increase the number of users. Many people take multiple credit cards because of the offer. There are also many people who don't need it but have credit cards.
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There is no point in having multiple credit cards and using them. Now the question may arise, there will be no harm if you don't use it? Simply put, what happens if someone leaves a credit card?
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What to do with an unused credit card: If the credit card doesn't have an annual fee, that's fine. And if annual fee has to be paid then loss. In this case, you should first downgrade the card and try to get a credit card that does not have an annual fee.
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If a no-fee card is not available at all, credit cards should be abandoned. What's the point of just counting a bunch of money without using it!
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What will happen if the credit card is closed: Many people think, if you don't use the card, what's the point of keeping it close! Better to stop than that. But many people don't know, closing a credit card affects the credit score.
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So you should keep it to yourself without closing it. This will improve the credit score. If you need to borrow in the future, this credit score will save you.
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Credit Utilization Ratio: Closing a credit card also affects the credit utilization ratio. Let's say someone has 3 credit cards. The limit of the first is 20 thousand, the second is 30 thousand and the third is 50 thousand. That is, the total credit limit is 1 lakh taka.
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Out of this, using 20 thousand rupees, the ratio will be 20 percent. In this case, if you stop using the credit card, the ratio will increase. Credit utilization ratio should not exceed 30 percent. Low ratio means less risk, easier to get loan.
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