http://www.cbc.ca/news/background/personalfinance/creditcards.html
Summary
The usage of credit cards by Canadians over the last few years have been steadily increasing and have now reached the point where over 50 million Visa and MasterCards exists within our wallets. Not only so, 24 million retail credit cards have also found its way into consumer's pockets by means of enticing offers of discounts when you apply for their card. With most stores accepting the source of payment by means of a plastic card, there are drawbacks to extensively using them. Credit cards most oftenly come hand in hand with interest and not paying on time simply increases that interest rate.Not only so, the option of paying the minimum amount only increases the debt. So why do Canadian have so many credit cards? Simple, they are easy to apply for and are a great way to pay off debt at a later date, especially when your paycheck has not yet arrived.
Connection
As many of us know, a visit to the bank to deposit money or withdraw money, the bank charges certain fees for helping you accomplish such a task. With credit cards, it is the same. Cardholders are charged transaction fees and annual fees and most importantly, interest on overdue payments. Interest rates vary from store to store and sometimes bank to bank but this is what takes a toll on the consumers, especially for people who do not take note of their bills when they arrive but when the stack of mail blocks out the light. It is often too late at that point to pay off their balances without interest and as a result, hefty interest rates. If this does not stop, it only becomes a cycle. On an even darker note, not paying your fees on time leads to bad credit history and may eventually be the reason for credit card companies to disallow you from applying for their card.
Reflection
I understand why individuals prefer to not pay in cash for cash is easy to lose and unconveinent to carry in large amounts. On the other hand, it's conveinent for small grocery shopping payments and if we were to live in a world where there is no cash, we will still encounter scams, losses, and so on just like we do today. Currently, microchips are being installed into credit cards to decrease the number of frauds, but technology can be fickle. Once an individual figures out how to access these new cards, they will spread the news and consumers will be back to base one. I don't think cash should be completely eliminated from means of payment, but what I do think is people should consider when to use a credit card and when to use cash.
Subscribe to:
Post Comments (Atom)
4 comments:
hello :) I just read a similar article regarding the use of credit cards which can connect to the reduced use amount of cash. The amount of interest rate credit card's charge are quite ridiculous if you think about how much money the credit card companies can make. Something i totally agree with you is the fact that we can "visualize the world in a cashless society." My parents for example, probably have about 5-10 different credit cards. The use of cash in today's society is quite inconvenient to carry, and it can easily be lost. If you have time, can you tell me more about the microchips being installed into credit cards as it seems very interesting.
-P.Ngo
I agree with you in that credit cards are very convenient especially when you want to make a quick purchase. All there is to it is a swipe of the card, signing of your signature, and you’re done! There are also a lot of special rewards you can collect when using a credit card such as Air Miles where you trade in the points to get other things. It is very convenient for a purchaser to use a credit card, but I think it is a hassle for business who accepts credit cards. They have to complete the transaction, send it in, and wait for the money to be sent to them. What happens if the credit card is a fake one, the business then looses money. It depends on who you are: a purchaser or a business.
-J. Low
Beginning with the positive aspects, the convenience and efficiency of credit cards are surely proven to be popular amongst most people in our society. But however, I strongly disagree with your point about the use of credit card due to the fear of losing cash. For one thing, credit cards usually appear smaller that cash, regarding size. In essence, it will have an equal, or perhaps, more chance of getting misplaced or dropped. For another, it is actually more dangerous to lose a credit card in comparisons to cash. When one is lost, others could make continuous purchase with your credit card until the set limit is reached. Therefore, when a wallet is lost, many people offer an extremely great reward for the cards back, neglecting the cost of the wallet and the actual amount of cash in there. Lastly, it will be an absolute hassle, and to some extent, a disaster to report the lost of a credit card. As a result of the above reason, I personally believe that credit cards do not indeed contain all the positive qualities over the use of cash.
- A. Tao
Block A
Post a Comment