What is a credit card and how does it work?

Q: What is a credit card and how does it work?

A credit card is a financial tool that allows you to borrow money from a lender (usually a bank) to make purchases. When you use a credit card, you're essentially taking out a small loan that you promise to pay back. How it works: • You make purchases using your card • The card issuer pays the merchant • You receive a monthly statement with your balance • You must pay at least the minimum payment by the due date • If you don't pay the full balance, you'll be charged interest

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