When two persons apply for a Credit Card in joint names, the banks approve joint Credit Cards. Under such circumstances, both of them can use the Credit Card. There is a difference between the joint Credit Card and the add-on card. Let us understand the concept of the joint Credit Card before going into the pros and cons of joint Credit Cards.
- In a joint Credit Card account, there is only one card, but two applicants and users.
- In an add-on Credit Card, there is only one applicant and multiple users.
- The banks consider the income and other eligibility criteria of both the applicants in a joint Credit Card account.
- In an add-on card, the banks do not account for the income and other eligibility criteria of the add-on member.
- In both the cases, you get a consolidated statement of account.
- In a joint Credit Card, both the account holders are liable to pay the amount whereas, in an add-on card, the principal account holder is solely responsible for the payment.
Advantages of Joint Credit Cards
Usually, you Compare and Apply for Credit Cards in joint names with your spouse. You can also do so along with your child or parents. There are many advantages of having joint Credit Cards.
- Share your bills: When you share an apartment with your spouse or your partner, you have one rent bill, one electricity bill, one gas bill, and so on. Why should you have two Credit Card bills then? Having a joint Credit Card entails that you have a single Credit Card bill as well. Things become easy for you as well as your partner to have to pay a single bill for your joint Credit Card.
- Get a higher limit: When you apply for joint Credit Cards, banks consider the incomes of both the applicants. Therefore, a double income results in a higher limit on the card. It is because the double income increases your repaying capacity. However, it is not always necessary for both the applicants to have incomes.
- Get a better interest rate or a better Credit Card: When you club the incomes of both the applicants, you end up with higher It also allows you to bargain for a better interest rate or a higher variant of the Credit Card. An improved variant has more privileges and advantages. The joint Credit Card application allows you to enjoy these privileges.
Disadvantages of a joint Credit Card
- Both account holders are liable for payment: If you have a joint Credit Card, both the account holders are responsible for the payments. If there is a default, the banks can take legal action against any of the joint account holders even though you might not have made the particular charge on the card. The banks have the right to approach the courts and obtain an order to recover the card dues from your salary.
- It can affect relationships: It is beautiful to have a joint Credit Card as it increases your eligibility because of enhanced income levels. However, reckless spending on the Credit Card can affect relationships. The banks can demand payment from any of the account holders irrespective of whether you have used the card or not. Such issues can create rifts between the partners.
- Affected relationships can hurt the card account: Usually, you see couples applying for joint Credit Cards. It is an enjoyable experience, especially in good times. However, a divorce can sour up things. The divorce decree does not have any bearing on the joint account relationship. If your ex-spouse does not pay the bill deliberately, the banks can still demand the payment from you.
- Easy to take revenge: Does it sound childish to you? However, there are innumerable cases when the joint Credit Card account holder has taken revenge on their co-borrower by indulging in binge spending leaving the other one to pay the bill. Under such circumstances, you should approach the banks and apply for de-registering your name from the co-signed account.
Should you apply for a joint Credit Card?
Frankly speaking, it is wiser to have separate Credit Cards rather than go for a joint one. Understand the goods and evils of having a joint card before you apply for one. A joint Credit Card has its benefits and drawbacks. Surveys have shown that people feel closer to each other after acquiring a joint card. It is a good initiative, but things can go out of hand if relationships sour beyond the point of redemption.
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