Credit cards. You either love them or hate them. From talking to people, there seem to be a large number of people who do not like credit cards because they don’t like being in debt. And while we teach at MoneyBlog that debt isn’t always a bad thing and sometimes can even work in your favour, I suppose that’s fair enough. (If you’re open to considering it, see How To Use A Credit Card here).
However, credit cards are pretty much a must in modern society because if you put the debt issue aside, they offer you certain buyer protections that you cannot get any other way.
Online Purchase Protection
Have you ever had that experience where you or a relative have bought something online and then it either didn’t arrive or is not as advertised?
Your mum? Yeah… mine too. And if your story continues like mine, you contact the retailer who point blank refuses to do anything about it. Refunds, I discovered the hard way, are not something that retailers are obliged to offer. They do so at their own discretion. So while companies like Amazon and ASOS will take products back up to 30 days after you bought them (providing they’re not used), other less reputable retailers won’t give refunds at all.
In this sadly all too common situation, one of the simplest ways to protect yourself is to always pay by credit card. The Credit Act 1974 gives you as the buyer, certain protections when you buy things on a credit card that are not as advertised.
Rewards, Cash Back and Airmiles
High street banks are starting to cotton onto this now and offer cash back and rewards to customers who pay with their debit cards, but certain credit cards offer cash back on purchases, all kinds of rewards and even Air Miles to make your next flight cheaper.
The way we see it, spending the same money that you were going to spend anyway, on a debit card, just isn’t making the most of your money.