Ever wondered about the number of credit cards a person can own in UAE? Well, the answer is as many as they want! A person can own multiple credit cards as per their convenience. But, as the luxury of owning multiple credit cards enables their chances of more rewards, it also doubles their chances of increasing their debt parallelly. So, let’s find out more about, how many credit cards a person can legally own in the UAE and how many credit cards should they optimally have…
How many cards should a person have?
According to recent surveys conducted in the United Arab Emirates, More than 60% of the survey respondent UAE Residents are credit cardholders. According to estimates, there are millions of credit cards in circulation in the United Arab Emirates itself. Credit cards are so widely used by customers and consumers because of the various rewards policies they offer. These rewards are offered by credit card companies to their customers to use their credit cards. The benefits that a cardholder can get range from the movie offers to shop benefits, from cashback offers to points redemption and more.
Getting to the question, there is no limit as per the number of credit cards that a person can hold. However, their owning of credit cards highly depends on their income and their credit score. If a person knows how to use credit cards well and manage all of them together, then there is no legal limit as to how many credit cards they can hold.
Multiple credit cards and your credit score
There are a lot of myths revolving around credit scores and multiple credit cards. They are, in fact, very much related, but what customers need to understand is that merely owning multiple credit cards does not decrease your credit score. Late payments, missed payment deadlines, and prolonged defaults and debts with the bank or the credit card company cause your score to go down drastically. If you make sure that you pay all your cards off on time and never miss a deadline, your credit score will only grow without ever looking back!
Advantages of having multiple credit cards
- Having multiple credit cards increases your credit limit. If your credit card company refuses to increase your credit limit for your monthly expenses, it is a good idea to look for other credit lines to fulfil your expenses
- Having multiple credit cards opens you up to many different types of rewards. Many cards only offer discounts on selected brands and purchases. Thus, having multiple cards from different companies will expand your rewards reach to more and more brands with different policies and awards
- Credit scores might benefit a lot. If you exhaust your credit limit on your single card all the time, the card will incur damages on your credit score. It is optimal to only spend 30-40% of your credit card limit every month to ensure that your credit score only keeps growing. Having multiple cards can help you do that. Your expenses can be divided between these cards and you won’t have to use up the entire limit of any one of the cards.
- Consolidation of your business and personal expenses can also be separated by using two cards. For entrepreneurs and businessmen, it is very important to separate the personal expenses from the private ones. Having two different accounts is the trick.
Disadvantages of having multiple cards
- For people who are too busy to pay close attention to their monthly credit card bills and credit reports, having multiple credit cards might seem like an ordeal. Managing multiple credit cards requires many times more energy than managing a single card. These expenses need to be tracked meticulously to make sure you don’t end up paying hefty interest on your outstanding amount
- A survey found that 60% of all credit card holders did not know what their rate of interest was. Thus, it is very important to keep accurate track of these cards to manage them well and extract all benefits of the same
- Having too many credit cards will increase your monthly personal credit limit drastically. This will inadvertently tempt you to spend more and buy things that you cannot afford otherwise. At the end of the month, when you get handed your monthly credit bill, you will find that you have spent more than you can earn. This will keep a balance outstanding on your card for the next month too. All in all, you will have to pay more to the bank than what you actually spent in the first place.
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All in all, there is no limit on how many cards one individual can possess. Rather, it depends on individual-to-individual what their requirements are. It is completely up to the cardholder how they use and maintain their share of the credit. Experts suggest that it is better to not have more than one credit card because multiple credit cards are troublesome, even more so if the cards are from different credit card companies or banks. It is better, hence, to maintain one credit card to manage your financial faculties well.