Questions & Answers

What are credit cards?

Credit cards allow you to make purchases on credit which you then pay off at a later date. There are different types of credit card issuing systems, the Uk's most common being; Visa, Mastercard, and American Express.

What are the differences between credit cards and debit cards?

When using a credit card you will recieve a statement every month which you can either pay off a minimum amount or you can fully pay off. The minimum amount you have to pay off depends on your credit card issuer but is typically between 2% and 5% of the full balance.

with a debit card you use your current account to pay for purchases ie you can only make purchases if you have the money in your account.

Which type of card gives me more spending power?

A debit card restricts your spending to the funds you have in your account, meaning you can't overspend or get into debt, however in times of emergency you cannot access funds either. A credit card allows you to spend on credit upto the credit limit set by your issuer. Therefore if you only actually pay for your purchases at the end of the month when you recieve your statement. This can be very useful in times of financial emergencies. See our advice guide for hints about avoiding going over your credit limit.

What is a charge card?

Ac harge card is like a credit card but each month the balance must be paid off in full. The UK's leading type of charge card is American Express. Businesses generally use charge cards top pay for employees expenses etc.