The following are the common disadvantages of the credit card.

(i) Only a few outlets accept the card. It is the duty of the bank to set up or seek many outlets to service the customers in order to ease out the difficulties.

(ii) Some credit card transactions take longer time than cash transactions because of various formalities.

(iii) The customer tends to overspend out of immense happiness.


(iv) Discounts and rebates can rarely be obtained.

(v) The cardholder is responsible for charges due to loss or theft of the card and the bank may not be a party for loss due to fraud or collusion of staff, etc.

(vi) Customers may be denied cash discount for payment through card.

(vii) It might lead to spending habits and cardholders may end up in big debts.


It should, however, be clearly told that the benefits of credit cards far outweigh its disadvantages. But acceptability of a product mainly comes from its usefulness. It will become more popular in India if a large number of service providers accept payment through credit cards.