Should you link your credit card with UPI? What are the pros and cons?

Linking credit card with UPI depends on your circumstances, preference and risk tolerance. Here are some of the pros and cons to consider while using UPI interface. Here are some:

Edited By: Sonia Dham

Last Updated : 23 November 2023, 03:53 PM IST

UPI

The Unified Payments Interface (UPI) is a real time interface to transfer payments digitally through mobile transactions. In India, UPI has acquired huge prominence among people.

According to the information, the number as compared to past has seen a significant growth through mobile apps like Paytm, PhonePe, Baroda MPay, Pockets-ICICI Bank, MobiKwik, iMobile, BHIM app, Airtel Money, Axis Pay, SBI Pay, and Yes Pay. This is not all, a few banks offer their own UPI applications.

Linking credit card with UPI depends on your circumstances, preference and risk tolerance. Here are some of the pros and cons to consider while using UPI interface. Here are some:

Pros:

Convenience: Linking your credit card with UPI makes it easier and more convenient to make payments. You can use your UPI ID to pay for goods and services, both online and offline, without having to enter your credit card details every time.

Security: UPI is a secure payment system that uses multiple layers of security to protect your transactions. When you link your credit card with UPI, your credit card information is stored securely on the UPI servers.

Rewards: Some UPI apps offer rewards for using credit cards. For example, you may be able to earn cashback or points on your credit card purchases when you use UPI.

Cons:

Overspending: Linking your credit card with UPI can make it easier to overspend. With just a few taps on your phone, you can make purchases without having to physically hand over your credit card. This can make it tempting to spend more money than you can afford.

Debt: If you are not careful, you can easily accumulate debt when you link your credit card with UPI. This is because you are essentially using credit to make purchases, which means that you will have to pay back the money at some point.

Fraud: There is always a risk of fraud when you use any type of online payment system. This is true even with UPI, which is a secure system. However, if your UPI ID is compromised, someone could potentially use your credit card to make unauthorised purchases.

Overall, linking your credit card with UPI can be a convenient and secure way to make payments. However, it is important to be aware of the risks involved and to use the system responsibly.

Here are some additional tips that can be followed while using UPI safely:

Create a strong UPI PIN and keep it confidential.
Do not share your UPI PIN with anyone.
Only use UPI to make payments on trusted websites and apps.
Be careful about clicking on links in emails or text messages that claim to be from UPI.
Monitor your credit card statements regularly for any unauthorised transactions.

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Should you link your credit card with UPI? What are the pros and cons?