You must be an actual anomaly, like yeah, what you are saying makes sense, but you are the only person I've ever heard about who does that here in UK. Everyone I know, me included, just uses debit cards for purchases everywhere including Amazon. I have a credit card but I very very very rarely use it for anything.
1. (As everyone says) consumer protection. I can dispute a charge to a CC and am not standing out the cash (unlike debit)
2. Debit transactions don't have any inherent limit. The bank might flag a very large transaction but once a debit transaction is underway it can't be stopped. I had > £10k stolen from my online account via a debit transaction and though the bank made good, still, bad taste.
3. Most important if you are young - using (and paying off) credit card will improve your credit score which helps you when you do need the credit.
4. Delayed payment. Even when you clear your debt every month you're still getting the benefit of 30 days free credit on your purchases. In our current savings-rate environment this is somewhat moot but anyone who travels for work or has significant work expenses that they have to wait to get reimbursed for will find this a major feature. Lending your employer money really sucks.
5. Rewards cards. These have gone crappy over the last decade but if you are in a role where you have significant work expenses or where you put most of your expenditure through the CC it can be worthwhile to hunt around for and switch cards for deals. Spending £1000 at Amazon/year on a debit card will get you exactly £0 in rewards. Even 1% cashback would be worth having.
The only downside to CC's I see is that some people can't trust themselves with credit - they'll spend up to their limit and get into a spiral of debt. If you don't do that, they're better than debit cards in my opinion.
1) I've been able to dispute payments on my debit cards without any issue, they were always reversed instantly by the bank. Maybe I've been lucky, I don't know. And for the "bank is liable for your purchases" thing - that doesn't apply to anything under £100 either.
2) That is a stupid limitation of UK banks, not debit cards in general. I have a bank account in Poland and for the debit cards with that bank I can set individual limits for internet transactions, terminal payments, CNP(card not present) transactions as well as ATM withdrawals - with separate daily/monthly/temporary limits. Why British banks don't implement this is unfathomable to me.
3) I suppose, I have no comment on this really.
4) yes, but then you need to remember to pay it off and how much exactly, which is a bit of a pain if you have your daily spending mixed in with bigger purchases that you want to pay off over a longer period of time.
5) Again, personal experience - other than 0% interest on purchases, never had a credit card in the UK with any rewards whatsoever.
And yeah, it's not about downsides of CCs - it's just that when I pay for my daily shopping with my debit card it's out of my account, I know how much I have to work with at any given time, done. As I said elsewhere, I can't be arsed to work out it if my spending is spread across multiple accounts and different forms of credit.
I was going to comment "mBank, isn't it?" but then realised that in such a competitive market as you have in Poland probably every bank's implemented this already.
I'm in the UK and always prefer to use a credit card whenever possible. It automatically gets paid off every month so I never get charged any interest, I get points worth minimum 0.5% back for all purchases, and benefit from the fairly strong UK consumer protection laws here.
The only exception where I'd prefer a debit card is in very rare cases when there's an additional fee for using a credit card. That's usually for large sums and/or international payments though, in which case I tend to use a specialised FX company or Revolut. My normal debit card is literally the last card I ever use, when all else fails or is more expensive.
Uk here, I use credit cards for everything. Used wisely, consumer credit is incredibly useful. Example: bought a 4k motorbike, dealer finance or savings drawdown would have cost me hundreds; slapped it all on an 18-months 0% card and am now slowly repaying it on my own schedule, at no extra cost, while happily riding the thing.
Exactly; with a credit card paid off monthly by direct debit and an interest paying current account, you're earning interest on your cash and not paying any on your purchases. What's not to like getting what's basically free money with a little bit of no-brainer arbitrage?
What is this unicorn you speak of...? :) jk, I know some exist, I've just been irrationally faithful to a bank that probably does not deserve it anymore (coop)...
(But I keep my savings in an account that offsets against my mortgage, so I'm effectively getting a similar deal in practice by not accruing interest on that.)
Yeah of course, I do the same thing - when I said I use mine "very rarely" I meant that I use it for things like buying laptops or other expensive things, to use the 0% interest period. I just don't know anyone who actually uses it for day to day purchases from amazon and such, I just use my debit card for that.
I have two credit cards, one of them I haven't used in 5 years at all, the other I use as described, and according to Credit Karma my credit rating is 690 our of 700. We just remortgaged the house too without any issue.
So yeah, I don't think I care too much about my credit rating at all, it doesn't seem to be affected by this in the sligtest.
Fair enough if it doesn’t impact your day to day, but it will definitely impact others.
Also worth noting Credit Karma uses TransUnion which is only one of the big three rating agencies, and arguably the least important compared to Equifax and Experian.
>Everyone I know, me included, just uses debit cards for purchases everywhere including Amazon.
This is just as anecdotal as GP or indeed myself. I never use a debit card and don't know anybody that uses them other than for getting cash out of an ATM
How old are you? People using credit cards in my circle (early 30s, London) are firmly the minority. If we split a bill in a restaurant it's all debit cards. Maybe there's one person with an amex or something.
Do you check everyone's card when you split the bill? What makes you think the others are debit rather than credit cards?
For info: the debit & credit cards from my bank look almost identical. The only difference is one says "credit" in small black text. My credit card handles exactly like my debit card in terms of tap-and-pay etc. I just wouldn't use it to take out cash from an ATM, but then I can't remember when I last needed to do that.
> I have a credit card but I very very very rarely use it for anything.
But why? The credit card is strictly better isn't it? I thought the main reason people used debit cards was that they got one automatically with their checking account and just never bothered to apply for a CC, but that's not the issue for you.
I don't know, when I use my debit card it just goes out of my main account, done, don't have to worry about it. On my credit card I'll have bigger purchases I made some time ago and I'm working towards paying them off - if I put all my monthly purchases there too, I'd lose track of how much of that I need to pay off monthly and how much I've got left on my main account.
And yes, it can be easily worked out but I guess I just can't be arsed. And for purchases under £100, credit cards offer no additional protection whatsoever, so for my daily shopping I'd just be making my life more difficult for no reason.
Nowadays with open banking, apps are starting to be able to aggregate all your accounts and credit cards into a single pane of glass. It isn't perfect yet, but it's getting there.
> And for purchases under £100, credit cards offer no additional protection whatsoever, so for my daily shopping I'd just be making my life more difficult for no reason.
They offer better protection against fraudulent charges though? If your card gets skimmed it doesn't matter whether you were paying £5 or £5000.
I don't know in Uk or USA, but in the rest of europe there is no difference at all in protection against fraudulent charges between a credit and a debit card.
There's no difference with fraudulent charges in the UK, as far as I'm aware, but when you buy a product or service on credit, we have a law saying the credit provider and retailer are both liable.
This means for example if you buy a flight and the airline goes out of business, your credit card provider will need to refund you. Also if goods are faulty, you now have two possibilities to get your money back - and the credit card companies are usually more amenable.
I never understood this point - my debit card has been charged fraudulently couple of times, all it always took was a quick call to Barclays, 2 minutes on the phone with the agent and the charges were reversed and the card cancelled.
What exactly can a credit card do better than this?
You called and the money was available for you to spend within 2 minutes? When it happened to me I had to go in and fill out a form and wait about a month (not easy on a student budget).
Yep. I rang and said there's a payment I don't recognize and that I didn't make, for Uber in Vietnam. The agent was like "yep, looks fraudulent, we'll cancel it right now and are sending a new card straight away". Money was back by the time I disconnected from the call. Second time it was someone buying stuff on PSN with my card, exact same situation - had the money back instantly.
A friend of mine had her debit card skimmed years ago. The skimmer used it in the area around town, going to restaurants and buying gas in the area. When she noticed the fraudulent charges (transaction declined) she contacted her bank. It took a week for most of her charges to be investigated and reversed, in the mean time she had absolutely no cash.
