Why Credit Cards Are Better Than Debit Cards?

In today’s era of digital transactions, credit cards and debit cards have become the primary modes of payment. However, there is still confusion among many people about which one is better – credit cards or debit cards. While both these types of cards offer a convenient way to make payments, there are several reasons why credit cards are a better choice. In this article, we will discuss why credit cards are better than debit cards.

Protection Against Fraudulent Charges

One of the biggest advantages of using a credit card is the protection it offers against fraudulent charges. With credit cards, you are not liable for any unauthorized transactions made on your card, as long as you report them within a specific time period. On the other hand, with debit cards, the money is directly deducted from your bank account, and it can be difficult to get it back if you fall victim to fraud. Additionally, credit card companies offer advanced security measures, such as encryption and chip technology, to safeguard against any unauthorized use of your card.

Rewards and Cashback

Credit card companies often offer rewards and cashback programs to incentivize the use of their cards. These rewards can include airline miles, cashback on purchases, and various discounts. By using your credit card for everyday purchases and paying off the balance in full each month, you can earn significant rewards and cashback, which can help you save money in the long run. On the other hand, debit cards do not offer any rewards or cashback, so you miss out on these benefits by using them.

Better Credit Score

Another benefit of using a credit card is that it can help you build or improve your credit score. Your credit score is a crucial factor that lenders look at when you apply for loans or credit cards. By using your credit card responsibly and making timely payments, you can build a positive credit history, which can improve your credit score. On the other hand, debit card usage does not contribute to your credit score at all.

Interest-Free Period

Most credit cards offer an interest-free period, usually between 20-50 days, for making your payments. This means that if you make your payment in full before the due date, you will not be charged any interest on your purchases. On the other hand, with debit cards, the money is immediately deducted from your bank account, and you do not have an interest-free period. This feature can be extremely beneficial if you need to make a large purchase and cannot pay the full amount upfront.

Want to learn more about credit cards? Check out: Why credit cards are better than debit cards?

Protection for Online Transactions

Credit cards offer an additional layer of protection when making online transactions. With debit cards, the money is directly deducted from your bank account, leaving it vulnerable to fraudulent activities. On the other hand, with credit cards, you can dispute any unauthorized or fraudulent transactions and get your money back. Credit card companies also provide virtual card numbers for online purchases, which adds an extra layer of security by not sharing your actual card information.

Want to find out more about online transactions? Read: How to protect yourself from cybercrime?

Better Purchase Protection

Credit cards offer better purchase protection as compared to debit cards. In case of defective or damaged products, credit card companies may offer extended warranty or dispute resolution services, whereas, with debit cards, you have limited options for protection. Some credit cards also offer travel insurance and rental car collision coverage, which can prove to be extremely useful when traveling.

Want to know more about protecting your purchases? Take a look at: How to protect your purchases?

In Conclusion

As evident from the points mentioned above, credit cards offer several advantages over debit cards. From better protection against fraud to rewards and cashback, credit cards offer numerous benefits that debit cards lack. However, it is essential to use credit cards responsibly and pay off your balance in full each month to avoid interest charges. By utilizing the various features and benefits of credit cards, you can enjoy a hassle-free and secure mode of payment.

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