It is a wonder that half the population owns a credit card. Or do they not? How is it that even today some people confuse the terms credit card and debit card? Or do they just not want to understand?
It is no secret that the vocabulary of banking terms is a Spanish village for most people, and that product terms are just firewood in the fireplace. But it is precisely in cases like this that we need to pay the utmost attention to banking terminology. For it can bring us a lot of trouble.
Debit Cards.
This card is issued when you open a checking account at a financial institution (bank), and the principle is to withdraw the balance in the account, i.e., your money . Practically, it is used only for continuous access and recall of one\’s moneythrough ATMs, without being subject to the opening hours of the bank\’s branches.
Credit Cards
.
Credit cards are issued independently of checking accounts. In effect, it is ordinary credit. You withdraw money from your bank. You pay the so-called minimum payment each month, and the debt continues to grow over and over again, plus interest, usually around 20%. Of course, it doesn\’t take much and there are non-banks with much, much higher interest rates. And we go round and round like hamsters in a wheel, and it is incredibly difficult to get out of it. Unless it\’s too late. Unless it\’s too late, many people end up taking out even larger loans to pay off their credit card debt. They pay off debt with debt.
However, give this card another chance. Some banks offer an interest-free period of several days. This actually means that if you pay back the overdrawn money by a set deadline, you will not be charged interest, and in return you will receive a pre-agreed benefit, usually a portion of the purchase price, in cash back. In other words, if you learn how to use the card correctly, you can really benefit. That is, of course, if you don\’t get short-term memory loss and pay on time.
.
Credit cards are issued independently of checking accounts. In effect, it is ordinary credit. You withdraw money from your bank. You pay the so-called minimum payment each month, and the debt continues to grow over and over again, plus interest, usually around 20%. Of course, it doesn\’t take much and there are non-banks with much, much higher interest rates. And we go round and round like hamsters in a wheel, and it is incredibly difficult to get out of it. Unless it\’s too late. Unless it\’s too late, many people end up taking out even larger loans to pay off their credit card debt. They pay off debt with debt.
However, give this card another chance. Some banks offer an interest-free period of several days. This actually means that if you pay back the overdrawn money by a set deadline, you will not be charged interest, and in return you will receive a pre-agreed benefit, usually a portion of the purchase price, in cash back. In other words, if you learn how to use the card correctly, you can really benefit. That is, of course, if you don\’t get short-term memory loss and pay on time.