We all know that there are different ways to do investment. But have you ever wondered, is it possible to do an investment using credit cards? And if it is possible, then how safe it is?
Here comes the answer: Yes, it is possible to do an investment through your credit card. You can invest in the National pension scheme (NPS) using a credit card.
Generally, the goverment doesn’t allow investments through credit cards as they are considered as loans and borrowings. But it is been allowed for NPS.
NPS and its features:
It is a scheme which helps in making plans for better retirements. NPS carries a low risk. Two primary account types under NPS are Tier-1 and Tier-2.NPS invests in different schemes, some portion in it of equity also. You can change the schemes also if you are not happy with a particular scheme’s performance then. It is possible in both Tier-1 and Tier-2 accounts. It has been covered under section 80c of the income tax act,1961 deduction up to 1.5 lakhs can be claimed and an additional tax benefit of rs.50000 under section 80ccd of the income tax act.
Process of doing investment in NPS:
For doing investment in NPS through a credit card, you have to login into an eNPS account. Permanent Retirement Account Number (PRAN) is required along with Tier-1 and Tier-2 accounts.
Extra charges:
For doing investment in NPS through a credit card you will need to pay approximately 1% more transaction fees. So, in case, if you hold a credit card with 2% or more rewards, you can easily invest in NPS using a credit card.
Advantage:
It can be beneficial to you if you are using your credit card for the NPS investment as you can earn big rewards and bonuses as per the expert.
Bottom line:
If you are ready to bear extra charges and confident of paying your credit card bills on time then you can go with this option. However, debit cards and net banking will be considered more safe options compared to credit cards for doing an investment.
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