Revolving credit: what it is, who to ask for it and how it works

The revolving credit, now known as the revolving credit, is an increasingly used payment system. It is combined with a credit card and its operation is similar to credit. This is a solution that many take to postpone the payment of some expenses.

But it often happens that delaying them for a month is not enough, so it is necessary to delay them. The revolving credit allows all of this by paying in installments of the costs incurred within the maximum cost limit, established precisely by a credit line.

Who to ask for it

Who to ask for it

The revolving credit is generally promoted by banks and financial institutions. The institution to which it is addressed grants the use of a sum of money on credit. We are talking about not large numbers, but that allow purchases of small or medium size. However, repayment is the focal point and therefore pay attention to interest rates.

Consider then that you must also pay a contribution for the issuing and activation of the card and a kind of annual fee. Usually, the credit granted can be repaid monthly with installments agreed between the customer and the institute. After returning the sum received, the credit is automatically renewed, but within a certain number of times, established by you, in agreement with the credit institution.

How does it work

How does it work

This is a particular credit card, which allows you to pay your expenses by paying in installments. Wanting to give a practical example to explain its operation, we can say that the amount of a purchase paid with the revolving is not charged all at once, but in monthly installments, on the holder’s current account.

These installments then serve to rebuild the credit line. Every month, in fact, the cardholder will receive a summary statement of the expenses made with the details of the use of the credit, the amount charged and the credit available again. Each statement has an average cost of 1.23 euros for sending; for those above € 77.47 a stamp duty of € 1.81 is also required.

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