Developments such as pay-you-go, touch payments mean it is easier than ever to pay by card and for many of us our cards have become the standard method for us making our day to day purchases.
According to the UK’s payment association card spending in 2007 reached £265 billion compared to the £194 billion worth of cash transactions that took place and this is part of a long trend toward cards over cash.
The debit card you carry is typically linked to your current account but when it comes to credit cards we have much more choice. With so many different types of cards to choose from however it can be difficult to pick those which offer best value.
Late last summer PayPass, the touch payment credit card system, launched with a great deal of hype. Barclaycard in particular launched its OnePulse card which allows holders to pay for goods just by touching special pay points in selected retailers and even allow Londoners to pay for the Underground by touching ticket barriers.
While this was generally recognised as a great leap forward in credit card technology retailers have been slow to adopt the necessary technology.
The Pre-pay way
A second relatively recent addition to the credit card market is the pre-pay card. Borrowing from the mobile phone payment structure these cards allow you to top them up with cash and then spend till you run out.
This gives you all the benefits of a credit card in terms of being able to make purchases online and across the world but the with the benefit that you’re not actually borrowing on the card. A further advantage is that it limits your exposure to fraud. If a thief were to get hold of your details they’ll only be able to spend the money you’ve placed on the card rather than spend to the usual card limit.
However your credit card works, for most of us the advice remains simple. Look at the fundamental benefits, those which will keep the cost of your borrowing down. For those people who already have credit card debt the obvious factor is the balance transfer period. Moving your existing debt on to a card which won’t charge you interest for a year or more is a significant benefit.
If you don’t have credit card debt then look out for the cards with the longest introductory purchase period. This means you’ll be able to make purchases without paying any interest for up to a year on some cards.
Fun in the sun
One of the key advantages of a credit card is that you can use it all over the world. If you’re looking for a new card for a summer holiday then opt for a card which doesn’t charge foreign currency withdrawal or purchases which can add significantly to the cost of your holiday. A number of big names including, Abbey, Nationwide and the Post Office offer these.
Watch your spending
Which ever card you opt for remember the anything you buy will have to be repaid so make sure that you’re getting the best deal on your credit card borrowing before committing to any card, the best way to do this is to shop around and see what’s out there.