What is the primary function of a credit card?

The primary function of a credit card is to provide the cardholder with a credit limit that allows them to make purchases and defer payment to a later date. This mechanism enables individuals to buy products or services when they need them, even if they do not have enough immediate cash available.

When using a credit card, the cardholder essentially borrows money from the credit card issuer up to a specified limit. They can then manage their finances by paying off the borrowed amount over time, often with interest if the balance is not fully settled by the due date. This flexibility in payment timing is a critical aspect of credit cards as it allows consumers to manage their cash flow more effectively.

In contrast, the other options represent different financial products or features rather than the primary function of a credit card. For instance, while immediate cash withdrawal is a function associated with some credit cards through cash advances, it is not the fundamental purpose of credit cards as a payment tool. Similarly, transferring ownership of goods typically pertains to transactions involving cash or debit cards rather than credit terms. Lastly, connecting cardholders to loyalty programs is an added benefit that enhances the value of credit cards but does not define their main function.