Credit Cards Vs Paying Cash

Choosing a payment method is sometimes difficult particularly for buyers who cannot control their spending. Every payment method has its advantages and disadvantages. An evaluation of the pros and cons of a payment method can guide buyers on the best payment method. However, buyers must also consider their credit history and shopping habits. Some payment methods encourage buyers to spend more than they had planned to spend. A payment method could help buyers save money or control their spending but could also be inconvenient or insecure. Banks are aggressive in issuing credit cards to their customers. Their promotions encourage clients to pay for goods and services using credit cards instead using cash. Buyers must consider the pros and cons of credit cards before choosing them as their preferred payment method

Advantages of using credit cards instead of cash

Both cash and credit cards are convenient to buyers. However, credit cards are more convenient than cash for large purchases. Carrying large sums of cash is not only inconvenient but also insecure. Credit cards save buyers from long queues in banks to withdraw cash and allow them to pay for goods and services at any time. Most stores accept credit cards even for small payments. A credit card helps the user build his or her credit history. Consistent and timely payments of credit card bills give the user a high credit rating.

Computer technology and internet usage have intensified online business transactions. Customers prefer to shop and pay for goods online, which is impossible without credit cards and other online payment methods. Credit cards attract rewards, which buyers can redeem for goods or services. In addition, credit cards users can take advantage of cash-back programs for advertised merchandise. Another advantage of credit cards over cash is that a buyer can withhold payment for defective goods. If a seller delivers goods that do not meet the client’s specification, the buyer can withhold payment.

Disadvantages of credit cards

One major disadvantage of credit cards is that they encourage impulse buyers. Paying in cash enables buyers to control their spending and save cash. Credit cards can help users increase or decrease their credit rating. Individuals who cannot control their spending end up with huge credit cards debts and poor credit ratings. Many people fear paying using credit cards because of fraud. Hackers can access and wipe out a credit card user’s bank account if they can access the user’s confidential information. Credit cards require users to be cautious to avoid fraudulent transactions and theft.

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