Credit Card Advantages

Seweryn

Hi,

I have noticed the government stamp duty charge on my Credit Card and I am considering cancelling the Service, as I understand all the features of the Credit Card are available on my current account Debit Card, except the credit obviously, which I do not need.

Can you please explain if there are any services, procedures or purchases out there that can't be completed by paying with Debit Card and that I would need my Credit Card to get the payment through. I would like to know that before I decide to cancel my Credit Card.

I asked that question through the Online Service Desk, but the responses are usually very slow.

Speedwell

Seweryn, I am a long-time credit card refusenik, and in twenty years of using a debit card instead of a credit card, I have encountered only five scenarios where a debit card wasn't practical:

• Renting a car: The car rental company places a hold on a few hundred or so of funds on your credit card as a sort of "damage deposit". Normally this doesn't affect anything but your credit limit. But if you use a debit card, you lose access to that money until the hold is removed in a week or two after you return the car and any damage is accounted for.
• Reserving airline tickets: Same "temporary hold" often applies, not as a damage deposit, but as a check to see whether the funds are in your account. To add insult to injury, when you pay, it is not always with the held money. Even worse, the US frowns on a person traveling alone purchasing one-way tickets for cash and you get pegged for massively increased scrutiny. 
• Paying for something and getting reimbursed: I used to work for a large international company that wouldn't issue a credit card for expenses unless you were a manager. Their policy was to have the non-manager apply for reimbursement of travel costs after paying for them with their personal credit card. My boss got sick and tired of having to use HIS personal card for my travel expenses and had the policy changed to cover anyone with a demonstrated business need.
• Paying for a large-ticket item in an emergency when you don't have the cash: I had to borrow money from my father to pay for a flight to California when my mother died. Homeowners might need to replace a system. I had an emergency root canal in America that my insurance would cover only fifty percent of. No matter how well you plan and save, emergencies do have a way of piling on top of each other. 
• Paying for basics if a paycheck is late or you unexpectedly lose your job: I always try to stay at least three months ahead for this reason.

Note that none of these scenarios can ONLY be addressed with a credit card. I managed to get through them with a large enough balance on my debit card, from savings (on which I needed to pay no fee), by borrowing, or by making my employer pay directly for business-related expenses. The bank won't tell you how to avoid using a credit card; they make most of their profit off the fees and interest charges.

Seweryn

Thank you very much Speedwell for your response.

In the last 12 or so years of my Credit Card ownership the bank never got any interest payments from me, as the CC account is automatically cleared every month, so that is why I said I do not really need the credit facility.  I just do not purchase anything I wouldn't be able to pay for from my current account.
The expenses and the car hire fees make sense to point out.  The airline tickets can be purchased using a Debit Card.

BabySlam

A couple of times I availed of the credit card's dispute facility where the money was returned to my account when I showed why it was incorrectly taken,  for example if you buy something that is damaged/altered  before it reaches you.  It was quite easy and it is the credit card company who deal with the "seller".

Speedwell

BabySlam wrote: »

A couple of times I availed of the credit card's dispute facility where the money was returned to my account when I showed why it was incorrectly taken,  for example if you buy something that is damaged/altered  before it reaches you.  It was quite easy and it is the credit card company who deal with the "seller".

That's a good point. If the debit card is issued by a credit card company (such as VISA), then similar protections apply and my banks have been helpful in sorting such cases out if they can't be resolved between you and the merchant.

Bank of Ireland: Janet

Seweryn wrote: »

Hi,

I have noticed the government stamp duty charge on my Credit Card and I am considering cancelling the Service, as I understand all the features of the Credit Card are available on my current account Debit Card, except the credit obviously, which I do not need.

Can you please explain if there are any services, procedures or purchases out there that can't be completed by paying with Debit Card and that I would need my Credit Card to get the payment through. I would like to know that before I decide to cancel my Credit Card.

I asked that question through the Online Service Desk, but the responses are usually very slow.

Good morning Seweryn,

Thank you for contacting us on Boards.


The main difference between the two cards is the credit facility on the credit card. If you don’t us the credit facility then there wouldn’t be much of difference.
You would need to check or contact companies directly to clarify if they take visa or MasterCard.
If you would like to discuss this further it would be best to contact credit card services on 1890251251 or you should receive a reply to your ‘Ask a question’ on Banking 365 online shortly.


Thanks
Janette