Query re:credit card

DMcL1971

Unlike a debt card your credit card is not associated with your current account balance. So if you take money out of an ATM using it you are not withdrawing your own money, you are borrowing that money from the credit card provider.

coylemj

DMcL1971 wrote: »

Unlike a debt card your credit card is not associated with your current account balance. So if you take money out of an ATM using it you are not withdrawing your own money, you are borrowing that money from the credit card provider.

Unless you shoved some money into the account in advance in which case you are withdrawing your own money - a handy way of avoiding charges when travelling abroad.

masterboy123

Ok things are very clear to me now.

One last question, can I use the credit card in stores like Aldi, Tesco without paying extra fees? Also online for buying things from ebay, amazon? or to pay to a hotel or car rental company?

Thank you very much!!

DMcL1971 wrote: »

The short answer is 'never use your credit card to withdraw cash'.

It depends on the card type but with the most basic AIB credit card it would be 1.5% of the transaction value or €1.90 whichever is greater. In other words at least 1.90 per withdrawal.

DMcL1971

masterboy123 wrote: »

Ok things are very clear to me now.

One last question, can I use the credit card in stores like Aldi, Tesco without paying extra fees? Also online for buying things from ebay, amazon? or to pay to a hotel or car rental company?

Thank you very much!!

Yes credit cards are accepted nearly everywhere. In fact they are accepted in more places than debit cards. Before debit cards they were the only way to make any online purchase. I am not sure, but I believe some shops have a minimum spend before allowing you to use a credit card.

You keep on asking about fees, there are no extra fees!! Only annual government stamp duty and interest if you do not pay in full. There is no individual transaction fee and no fee for use. Like with all bank services there are penalty fees for misuse of the card such as spending more than your limit or having a lost card replaced. But you can use the card as much as you like, up to your monthly spending limit, and providing you pay it off in full it will never cost you anything other than the €30 per year.

BazzaDP

The exception being cash withdrawals. Cash withdrawals on a credit card have an immeadiate fee as mentioned above and also usually start charging interest immediately. So even if you pay off the full balance by the end of the month that balance will be more than just the money you withdrew.

However if you use your credit card only to make purchases and pay it off in full at the end of the month you will not pay any fees and there may be some other benefits (club card points, air miles, consumer protection...etc.).

However if you haven't the discipline/funds to pay off in full or want to use it for cash withdrawals then a credit card is usually a bad idea.

murphaph

coylemj wrote: »

Unless you shoved some money into the account in advance in which case you are withdrawing your own money - a handy way of avoiding charges when travelling abroad.

Be very careful doing this! Many CC companies craft the small print so that they have no liability for fraudulent use if the card account is in credit. Loading a couple of grand on the card can be very risky because of this (sneaky) practice.

masterboy123

wwoohhhh, thanks for this great advice.

murphaph wrote: »

Be very careful doing this! Many CC companies craft the small print so that they have no liability for fraudulent use if the card account is in credit. Loading a couple of grand on the card can be very risky because of this (sneaky) practice.