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6 Credit Card Myths You May Not Know About

There are many credit card myths that are prevalent among credit card users and non-users. Let us look at some of the popular credit card myths.

There are always three sides to a story: yours, theirs and truth. As everyone has their perception and believe in their version, ideas start to crop up which may be just a myth. 

Every sector has its myths and the banking sector is not too far away from it. One such financial product that is associated with several myths is the credit card. 

A credit card allows customers to buy things even if they don’t have to pay now. It also comes with various attractive features like cashback and offers. 

Here are some of the myths associated with credit card:  

1.Credit Card lowers your credit score

A lot of people believe that a credit card will lower credit score which is a big myth. Using credit cards wisely can help you improve your credit score. If you maintain and manage your credit card, you will see a boost in your credit score which will help you to avail loans easily. If you pay your credit card bills on time, it will not lower your credit score.

However, your credit score may be impacted if you don’t pay your bills on time or credit utilisation is at 90%.  

2. Owning multiple credit cards can negatively impact your credit score

Most people believe that having multiple credit cards means a lower credit score. However, it is just a myth. Your credit score also depends on your credit history. This means that if you have an old credit card and have upgraded to newer cards, your credit history will be based from your credit card. So, having multiple cards or not closing earlier credit cards may have a positive impact on the credit score.  

3.One should close their old credit cards

 As stated in the previous point, it’s okay to continue with the old card as an old card signify a longer credit history which positively impacts your credit history.  

4. Using a debit card can improve your credit score

Though debit card and credit card looks same, a debit card has nothing to do with your credit score. When you use a debit card you are withdrawing your money from your savings account which does not increase or decrease your credit score. On the other hand, when you use a credit card you are taking credit which impacts your credit score. If done properly, it increases your credit score while the debit card has no such effect. 

5. It is okay to take a credit card based on its joining offers

 As an attempt to attract customers, banks and credit card companies run a lot of introductory or joining offers. Companies waive off their annual maintenance charge and give tempting discounts on purchases for a limited period. However, getting a credit card based on introductory offers may not be the right approach. Before taking a credit card, it is best to know what you are getting out of the card.   

6. You should keep balance on your card and pay the minimum.

 Many people believe that you should pay a minimum amount and keep balance on your card as it will help you in credit score. But the reality is that it will not help you but negatively affect your credit score as it will increase your credit ratio utilization. The risk of keeping outstanding balance may also affect your interest payments. So it is always better to pay your total due amount every month.


A myth has been advocated by several individuals may seem like the truth. But it is just that, a myth. While it may be okay to ask help from your friends, family, and colleagues, you should exercise caution before agreeing with whatever they say. Take advice with a pinch of salt. 


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