In praise of Credit Cards
With constant media attention regarding the total credit card debt in the UK it is easy to overlook the fact that a credit card is a very useful instrument in your day to day financial dealings.
Credit cards enable you to purchase goods and services in most retail outlets (including the Internet) without cash (subject to your credit limit). You can purchase goods and services, with your credit card, even though you may not have the monies to pay for it right away as you can pay it off over a period of time.
You also have the security of knowing that you do not have to carry large amounts of cash when you want to purchase goods and services. Instead you can nowadays pay by what is known as chip and PIN. Chip and PIN is universally in use in most retail outlets in the UK. It affords security in that instead of signing a receipt you key a four digit number into a keypad. This number should be selected by you and not revealed to anyone. Ideally this number should be memorised, but in any event should not be written down and kept in a place such as a handbag, so that if it is stolen the thief will not have access to your PIN and use your credit card illicitly. Should a theft take place and it transpires that you were negligent in not concealing your PIN the credit card lender will not reimburse you for your losses even if you report the theft within the required time, usually 24 hours.
Another form of peace of mind with regards to the use of credit cards is afforded by the Consumer Credit Act 1974. If you purchase goods and services and are not satisfied you can ask for your money back. In such a situation the credit card lender will reimburse you and seek redress from the retail outlet. Alternatively, you may have purchased goods and services but the order was not fulfilled, perhaps because the retail outlet was made bankrupt in the meantime, then again the credit card lender will reimburse you for your losses.
Like most things in life a credit card is neither good nor bad, it is the way you use it that counts. Use your credit card wisely so that you do not saddle your self with unwanted debt. The credit card is definitely here to stay.
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