Credit card use is on the rise in the UAE. More people are using credit cards as a form of payment — they’re more convenient than cash, offer purchase protection, and can even be used to pay for public transportation.

When used responsibly, a credit card can be an excellent way to build your credit score, increase your credit limit and even save money over time by paying off your balance every month rather than buying everything with cash. However, before you dive in and apply for your first card, it’s good to know exactly what kind of user profile you might fall into so that you can find the right card for you.

Let’s gloss over some of the things you might need to figure out before choosing a credit card, plus see what some of the use case scenarios are.

What type of user are you?

If you’re wondering what kind of person should consider getting a credit card, there are a few different factors to consider. Taking your specific financial situation into consideration, there may be certain groups of users who stand to gain more from owning and using a credit card than others. Knowing who you are as a user and what kind of person you are can help you decide if opening a credit card makes sense for you and your financial situation.

How will you be paying off your balance each month?

Credit cards are often classified by their payment terms. Making only partial payments each month can have a significant impact on your overall cost. If you’re constantly carrying a high balance, the interest you’ll be charged over time can be costly. A card with a low monthly payment amount and low-interest rate will put you at much less risk of paying a large amount of money in interest. On the other hand, low-interest cards often have a higher annual fee than high-interest cards.

What are your financial goals?

If you’re wondering what types of users are the best candidates for opening a credit card, another thing to keep in mind is precisely what your financial goals are. There are a number of different types of users who might find benefits in getting a credit card. For example, a frequent traveler who is hoping to build up their credit score might find a rewards card that offers free flights and hotel stays particularly useful. On the other hand, a cardholder who is only going to use the card for small purchases and aims to pay off their balance every month as quickly as possible might find a card with a meager annual fee and low interest rate a better match for their needs.

Gauge if an annual fee is worth it to you.

There are a number of different factors to consider when deciding if an annual fee is worth it for your specific credit card. Before you apply, it’s a good idea to do some basic research on different credit card companies and find one that seems to fit your needs best. One factor to keep in mind when looking at credit cards is the fees they charge. By keeping an eye out for cards that charge unusually high annual fees, you can find a card that suits your needs. If a card’s annual fee seems too high for what it offers, there may be other cards out there that charge a lower annual fee, but their offers might not be as extensive.

EXAMPLES OF CREDIT CARD USERS

A Frequent Traveler

Anyone who travels frequently will appreciate the perks that come with having their own credit card. Credit cards with travel benefits can often offer discounts on travel expenses, including flights, hotels, and car rentals. In some cases, they may even allow you to earn free travel rewards or free flights. Depending on your travel habits, a travel credit card might be handy for you.

An Existing Cardholder Who’s Keeping an Eye on Their Credit Score

Anyone who already has a good credit score and is looking to improve their credit score before applying for a new credit card will appreciate the benefits of keeping an eye on their existing credit report. Free credit monitoring services are offered by most credit card companies that allow you to check your credit score and make sure it’s on the up. Credit card companies may also provide free identity protection services. These services will enable you to make sure that your credit report doesn’t have any incorrect information.

A New User

New users are often offered an introductory rate to get them started with a card. Most credit card companies offer a promotional period where they offer a low rate on the first several months' worth of payments. New users often want to make sure they take advantage of this offer. One of the best ways to do this is to pay off your balance every month as quickly as you can. This has the potential to improve your credit score by ensuring that you have a higher amount of money available to you.

A Business Owner

There are credit cards that are geared toward business owners, explicitly designed to be used for the growth of the business. They can provide a much-needed credit line for the company so that any urgent resource needs are met swiftly.

A Frequent Shopper

If you are someone who shops frequently, credit cards might be the ideal payment mode for you, as they offer attractive rewards when used to shop. These rewards are often doled out in the form of points that can be redeemed later.

Conclusion

Credit cards are an exciting way to get a line of instant credit as well as start building your credit score. There are a multitude of users who might find them helpful, and depending on what you’re looking for, one kind of card may be more beneficial for you than the other. Before you sign up for your first card, it’s a good idea to consider the factors we have discussed so that you can find the best credit card for your specific situation.