Have you ever heard of the payroll credit card or considered applying for it? Although much like a conventional card, this financial product is known to be one where the minimum invoice amount is automatically deducted from the customer’s paycheck.
Moreover, it is unique to people who may have a payroll loan. However, to better understand this card, its advantages and disadvantages, how about reading more about this subject? Follow the article we prepared for you to answer your main questions:
Can you make a payroll credit card?
This option is considered as a more affordable personal line of credit compared to the conventional card . However, the product is suitable for those who are civil servants (including Armed Forces employees), retired and pensioners, provided they have a limit on the payable margin.
And despite having rates up to 5x lower than credit card, ideally always pay attention to pay the bill on time and not get into debt. Therefore, to have the card payroll is important to have a source of fixed income that has an agreement with one or more banks to do this type of operation.
Advantages and disadvantages of payroll card
To help you understand if this is an option for you, it is worth knowing the advantages and disadvantages of the financial product:
What is good?
- Annuity free;
- Some card banners have dot programs;
- Cash withdrawals 90% of your card limit;
- If you do not pay the full amount of the invoice, only 5% of your salary is deducted;
- Invoice with description of place of purchase, date, among other important data;
- 72 months to pay off the credit.
What’s not so good?
- Interest is higher than payroll loans;
- The minimum card payment is automatically deducted from your salary or benefit;
- Some carriers charge a payroll credit card issuance fee;
- Increased risk of debt if you do not know how to control spending.
Differences between payroll and conventional card
The biggest differences between these two credit alternatives is the interest rate and repayment term . This is because the payroll-deductible credit card has a lower cost as the bank guarantees the repayment of the loan. After all, he discounts the minimum wage or benefit even before he falls into the account.
On the other hand, when it comes to payment terms, the payroll card can provide up to 50 days to settle the demands. Meanwhile, on the conventional card, this period can reach 35 days. Other relevant differences between the two are:
- With the payroll card you do not need to be an account holder at the bank where you applied for credit