Almost everybody I know has at least one type of these cards and is using it as their primary payment method. Debit and credit cards are extremely useful and they provide certain features that makes it easier for us to deal with different sorts of monetary matters. Following, I am going to provide you with the main advantages of using debit and credit cards, and why more and more people are choosing them as their preferred method of payment.
Main Advantages of Debit Cards
First of all, there are no interest rates or monthly fees that you have to pay each month or so as part of having a debit card; it is absolutely free to acquire one. Therefore, you will never have to worry about paying debts for using the card "too much" or about any other types of payments to settle.
Secondly, with debit cards, you can easily control the amount of money available to spend. Whatever the card lets you take out is only what is already in your account. You can't withdraw or spend more than what you have, but at least you'll never go out of control and spend too much (as is the case with some credit card owners...).
And finally, debit cards are usually protected by a PIN. This is a four digit number that works as a password for your card. Without it, you won't be able to use the card, and this is very convenient because no one else can make use of it if they don't know what the PIN is. However, if the debit card has a Visa, Discover, or MasterCard symbol on it, then in this case, it can be used even without entering a PIN.
Main Advantages of Credit Cards
The first and most desirable feature of having a credit card is that it gives you power. Credit card users feel satisfaction and confidence because their cards gives them the feeling that they can buy whatever they want. They can make big purchases if their credit limit is pretty high even when they don't have the actual money in their personal accounts.
A second advantage of having a credit card is that you can make purchases any time you want. You don't have to wait for the end of the week or the month for your salary; because time is not a restriction here. You can buy the items you want on credit and have them right away.
Finally, a third advantage of credit cards is that the payments you make using the card are not deducted from your personal accounts. Credit cards have separate accounts that work differently than your checking or savings accounts, for example. Therefore, whatever money you spend using a credit card is what you are actually borrowing from the issuer of the card.
- Here is a very interesting news article I encountered that provides statistics on credit cards and credit card owners.
Sources:
Woolsey,
Ben, and Matt Schulz. "Credit Card Statistics, Industry Facts,
Debt Statistics."CreditCardscom
News.
CreditCards.com, n.d. Web. 12 June 2013. Retrieved from: http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debt-statistics-1276.php
Barrymore, John. "How Debit Cards Work." HowStuffWorks. HowStuffWorks, LLC, n.d. Web. 06 June 2013. Retrieved from: http://www.howstuffworks.com/debit-cards.htm
"Credit or Debit: The Choice Is Yours." Debit Card vs Credit Card: Risks and Benefits. Privacy Matters, n.d. Web. 06 June 2013. Retrieved from: http://www.privacymatters.com/credit-information/credit-cards-vs-debit-cards.aspx
Which method, debit or credit, provides the most security if you were to lose your card or someone steals it? And can't most bank cards/debit cards with either a Visa or MasterCard logo be used as credit cards?
ReplyDeleteTo first question: Credit card payments are definitely more secure than debt cards, and the credit card company will instantly back you up and compensate you if your card was stolen. This is because more fraudulent activities occur on credit card accounts than on debt card accounts due to the very high credit limits available.
DeleteTo second question: Not exactly .. There are debit cards that have the Visa or MasterCard logo on them, but these are not exactly credit cards. The only reason they are said to function like a credit card is because the cardholder can make purchases using them without actually entering his PIN. Any money the cardholder withdraws using these cards is actually coming from his/her personal account, like the checking account, and is not money loaned from a credit card company. Therefore, they cannot be used as credit cards, they only allow the cardholder the option of using them without a PIN.
I mostly use my debit card because I find it easier to you and I rarely get credit cards. I was told that buying stuff from online it is safer to you a credit card, it that true? Also from time to time a place that I use my debit card but it is ran as credit because the store can only take credit, how is it possible for my debit card to be ran as credit?
ReplyDeleteYes, it's true, credit cards are definitely more secure and safer to use than debit cards. And it is possible for debit cards to work as credit cards because Visa (if your card has the Visa logo at the front side of it) makes this "credit" option available to make sure that your transaction is secure and that you will receive protection, like zero-liability if something went wrong. These are features that are usually available for credit card users, not debit. But one of the main goals of companies is to satisfy the customer and try to do what they can to offer them the best features available. However, choosing this option does not mean that you are buying on credit and paying back to the company later, the money is still deducted from your personal account. The only thing this means is that you do not have to enter your PIN.
DeleteSource: Landes, Luke. "Answering Mail: Using Debit Cards as Credit Cards." Consumerism Commentary RSS. N.p., n.d. Web. 18 June 2013.
I enjoy the security of using a credit card for online transactions and the convenience of being able to pay at a later date. I used to be less responsible with my credit cards, but now that I have a much better paying job I find it easier to pay off my balance every month. I would not recommend using your debit card online as it is not as secure.
ReplyDeleteI love my debit card. I can't live without it. I hardly ever have cash on me. I also have a credit card and use it for gas and larger purchases. I earn points when I use it, so I'm thrilled! I've noticed that one huge disadvantage to having any type of card is that cashiers usually don't check for proper I.D. There have been numerous times where I used my mother's or uncle's card and was never questioned or asked to present my I.D. It's becoming easier to obtain debit and credit card information and current business practices lack responsible I.D. procedures. Some people think it's a hassle. But, as a consumer, I feel great when a salesperson requires to see it before purchasing. It gives me comfort that a company is diligent.
ReplyDeleteTo resolve this issue of choosing which is which, you might have to assess your lifestyle. Also, there are attached risks to both of these payment methods. Anyway, it's still your call. Thanks for sharing this very informative article of yours.
ReplyDelete