Why a Prepaid Debit Card and Not a Credit Card

Prepaid debit cards are a good alternative to credit cards for anyone who is trying to control their spending. A prepaid debit card allows a consumer to deposit their money into a virtual account that can be accessed through a debit card. Once the funds are depleted, the consumer cannot spend anymore.

Unlike a credit card, a prepaid debit card does not allow a consumer to spend money he or she doesnt have. This prevents the consumer from racking up debt that he or she cannot pay off. Additionally, there is no interest charged on a prepaid card, and no bills to pay at the end of the month.

All these make the prepaid debit card a more responsible tool for budgeting and spending money, at least compared to a credit card.

In addition to controlling spending, many people like to use prepaid debit cards to send money abroad or give a gift to a relative or friend. Since these cards are easy to load and mail, they are ideal for people who need to send money abroad. In fact, they are safer than sending cash or checks through the mail, since many cards are able to be re-issued if the proper paperwork is kept. These debit cards can be used in many countries. A Visa debit card is particularly convenient since it can be used at thousands of stores and restaurants that also accept a Visa credit card.

Unlike credit cards, debit cards do not charge interest, but there are a few fees involved with using them. Just like a checking account at the bank, most prepaid cards will charge a maintenance fee once a month, as well as a small transaction fee when the card is used. Prepaid cards such as a Visa debit card do this in order to recoup their costs for issuing the cards and transferring the money from the card to the merchant or to other accounts. However, these payment and transfer fees are very low compared to those charged by banks for similar transactions.

All in all, prepaid debit cards are a great way to control spending through the holiday season, an excellent alternative to a high fee checking account, and an inexpensive way to transfer money to relatives and friends abroad.

How To Avoid Credit Card Debt

There are certain things in life that you will wish to avoid if you want to have a secure financial present and future for yourself and your family. Credit card debt is certainly one of those things that you should be avoiding. People do not always realise or think about it but keeping an outstanding credit card balance is one of the most expensive financial arrangements you could possibly subscribe to. If you have even an average interest rate, and not too much of an outstanding balance, you could be wasting literally hundreds of pounds a year by not paying off your outstanding balance in full each month.

There are also other problems with keeping a high amount of credit card debt. You will be making your credit rating worse for one thing. And this is something that you should be concerned about. Credit providers, banks, insurance companies and even employers will use your credit rating as a means of assessing your financial standing. If you have a very high outstanding credit card debt, or are close to your credit card debt limit, this will be regarded as a negative in the assessment of your credit score and for this very purpose, it is something that you should be attempting to avoid.

A lowered credit rating will cause you to receive worse terms and offers for future credit. For example you may get

Higher interest rates
Less favourable terms
Lower credit limits
Refusal of credit

If you wish to avoid one or more of the above out comes, you should be trying to keep your credit card debt under control. One way to do this is to simply stop using them. Discipline yourself, or if this is too difficult, take the credit cards that you are using, out of your wallet or purse, so that you cannot give in to the temptation of using them. This way, the amounts you pay back will start to reduce your outstanding balance and you will get things back under control.

Another thing you should be making sure that you are doing is repaying more than the minimum repayment on your monthly bill. Many cards allow you to repay just the interest, and if you are doing this, it means that you are repaying none of the actual outstanding balance each month so even if you stop using the credit card, you will not be paying them off. You are simply servicing the debt. You should make sure that you are paying back the credit card balance over a reasonable period.

Save Money Do Not Borrow it on your Credit Card

Lets face it we have all been in a position where we have needed a little hard cash depending on if it is at the end of the month or a unforeseen bill that needs paying straight away. However before you go off down to the ATM and take that cash out on your credit card, lets just take a look at the reasons why you should be careful before borrowing from the credit card company.

Firstly every time you take money out of the ATM the fee for that money comes into play immediately. The cash advance that you are thinking about can have between 2 and 4 percent Higher interest rate than your regular credit card rates.

Not only will you be charged by the credit card company for borrowing the cash you will also find that you are charged a percentage by the ATM vendor. Those handy little ATM’s in the gas station can charge up to 1% to give you the cash! That is an extra 1% you have to pay to get that money.

Confused? Ok let us take a quick look at how this all works:

You see on a market stall a fantastic stereo that you have wanted for ages. The vendor being a street trader would prefer it if you pay in cash (lets face it if you use your card there he gets charged for the fact that he is using the credit card companies facilities). You decide you must have it so you go to the ATM and draw out $200 on your credit card.

This cash will be the last thing that your credit card company lets you pay off the card. So if you have $500 on your card and you take a further $500 out at the higher rate of interest as it is cash, you will pay that rate of interest until you reach zero balance even if you pay off $500 the next day! So you will still end up paying over the odds to borrow that money.

Eventually when you hit the zero balance you will notice that you have over the time that you borrowed the money been charged three times. Once by the ATM where you got the money from. Once by the credit card company for taking the cash option and once more by the credit card company who will charge you a higher rate of interest for the privilege of having cash in your hand.

Is it really worth it to get something a few days early?

Credit Card Processing How the System Works

Establishing a merchant account for your business enterprise is the wisest financial decision you will ever make for the growth, expansion and success of your business. Once you’ve set up a merchant account, you can accept credit and debit cards payments from your clients for your products and / or services. You can also arrange to accept online and mobile banking payments for your products and / or services.

A merchant account opens up new avenues for your business; therefore, giving your business many more opportunities to flourish. But, have you ever understood how the credit card processing system works? Have you tried to perceive the complexities of the players involved in the process and the intricacies of the system?

While it is not entirely essential for you to know the inside and outside of the card processing system because your Merchant Service Provider will do the needful for you; it is good for you to acquaint yourself with the system on a general basis.

The Participants Involved in a Card Transaction

A typical credit or debit card transaction involves the following players:

The customer
The merchant
The payment gateway
The customer’s credit card issuer
The credit card interchange
The processor at the acquiring bank
The merchant’s acquiring bank

The Route the Money Takes from the Customer to the Merchant

Let’s take an example to understand how the card processing system works.

Suppose that a customer walks into a clothing store and she finds a bag that catches her eye. She immediately proceeds to the payment counter and makes a payment of $100 towards her purchase with her cards.

The cashier at the merchant’s store accepts the cards and uses a card swiping machine to set the process into motion.

The $100 amount makes its first stop at the payment gateway where the payment is first authorized with a minor deduction in the amount.

Now, $99 travels to the appropriate processor and after a minor deduction is submitted to the card interchange as $98.5.

Once the transaction gets a clear at the interchange, it moves on to the issuing bank with a further deduction where the issuing bank verifies the availability of funds in the customer’s credit / debit card.

If the transaction is declined, it makes its journey back to the customer from here.

If the transaction is approved, $98 reaches the processor at the acquiring bank, just one step closer to the merchant account.

Once authorized, $97.5 gets deposited into the merchant’s account, which is now at the merchant’s disposal.

(The figures and fees involved in card processing are based on the number of players in the process, merchant type, card type and risk factors)

In the present age, quite a number of payments are made electronically, especially with the extensive use of credit and debit cards and online funds transfer. Although typical card processing takes seven participants, the entire transaction amazing takes a maximum of five seconds for approval.

Best credit card application made easier

Things have changed drastically unlike year ago when it was impossible to know at one go the best credit card firms in the US. Technology must be appreciated in all sectors of the economy. It is now easier than ever to know the best card companies through the freely availed online comparator. One does not have to make unnecessary calls to do so or walk from one end of the city comparing notes. That is history. America tops in some of the best credit cards used worldwide and at very affordable rates namely:- ?American Express ?Chase ?Master Card and ?Visa amongst many others To be able to get the best deal when looking for the best credit card don’t limit yourself to only the top most facilities. There are numerous companies that are giving their customers incredible deals when it comes to choosing to do business with them. With competition being rife, most companies now have initiatives that give customers the chance to chose who they deal with when it comes to making which company to deal with. A cashless society is currently the best thing at a time when people travel the world over. Having to change currencies at each point of entry sometimes is too costly in the long run. If you take time to study the market regarding different kinds of available cards in the market. You will be amazed at the incredible perks you might find by signing with the right company. Do not make hurried or hasty decisions when it comes to choosing a provider. Compare and re-compare best credit card charges and you will be amazed at how the charges in the market differ. Choose a card that will be of service not only within the US but the world over. To be able to locate such, why not look at for cheaper and greater results.

Advice On How To Use A Credit Card

The credit card is really a fantastic concept. However if it is not used properly it can simply bring financial ruin. By not using it properly you could end up in the unpleasant situation of paying every month interest. The credit cards in our days can be very helpful accessories since you won’t need to deal any longer with cash. When utilized correctly they could supply you with a lot of excellent benefits such as air miles or credit toward future purchases.

The most crucial element is to never think about the credit line of the credit card as extra cash which may be spent whenever you want on various stuff. Once you’ve acquired some thing make sure that every month you pay promptly the financial obligations. Also never get to many credit cards since when having a lot you’re tempted to acquire all kind of necessary and expensive things. Whenever you consider signing up for such electronic devices do not ever pick the firms which have substantial charge for late fees or charge membership fee. The main reason why is extremely important to use appropriately a credit card is really because you’ll never be in the tough situation of getting a bad credit. Any time reaching this particular stage there are numerous things that can be performed but the most effective is the process of repair bad credit. When making daily buys utilize cash or the debit card and not the credit card. This are some essential aspects that really have to be considered mainly because by using this electronic device for every day buys you can achieve the phase where you see it as a substitute for cash. This in many of the situations can lead to debt.

When paying your monthly obligations don’t get into the habit of making just minimum payments. This will just increase the period of time to pay the debt. Also avoid using your credit card to get stuff that you can’t afford and don’t close up one without knowing how your credit will be influenced. If you will consider all of these factors you’ll definitely not finish up in the position in which you need to repair bad credit. Surely that the credit card in our days is a very useful accessory. However , you have to don’t forget that in order to take advantage of all of the benefits you need to use it in the most appropriate way.

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Australian Government Warns About Business Credit Card Fraud

Business credit card fraud involves the use of plastic card details to make purchases or withdraw cash without the business owner’s permission. The Australian Crime Commission estimates that serious organised crime costs Australia between $10-15 billion every year. In 2008, the Australian Bureau of Statistics reported from their survey of fraud 499,500 victims of identity fraud in the preceding year, the majorities (77 per cent) were a victim of credit or bank card fraud.

In 2009, information was the most commonly sold item in the underground economy. Criminals may couple this information with details harvested from social networking sites to commit frauds.

Criminals may hack into databases of account numbers, which are held by Internet service providers or other businesses with customer information, or by intercepting account details, which travel in an unencrypted form. People engaged in card fraud may also be linked with numerous other organised crimes.

The Australian Bankers Association also warned merchants over credit card fraud. Recent data revealed business credit card fraud was increasing. Steven Munchenberg, chief executive of Australians Banker’s Association, says criminals are constantly seeking new opportunities to defraud, and the rise of online retail provides the perfect platform.

Mr. Munchenberg says the focus is not just domestic, because a lot of the fraudulent transactions are being done offshore via the Internet. Figures from the Reserve Bank indicated that Australians, of which the majorities are business credit card holders, make more than 152 million card transactions on a monthly basis.

The Australian government warns small-business owners to be aware of fraud. In 2011 to 2012, more than 1 million fraudulent transactions were reported. Scammers are known to disguise themselves as government agencies (Australian Taxation Office) and send emails requesting confirmation of details. The Australian Taxation Office will not send an email requesting you to confirm card details. Business owners can receive a legitimate-looking e-mail or invoice with payment details. The Australian Competition and Consumer Commission warned small businesses about government scams.

The ATO recommends you make sure you keep your business’s tax file number and passwords secure. The Australian Crime Commission estimates that serious organised crime costs Australia between $10-15 billion every year. New data revealed business credit card fraud was increasing.

Credit Card Consolidation The Process Explained.

When a person possesses a multitude of credit card accounts, it is easy for the debt to become quite overwhelming.

The sum of the payments on all of the credit cards can add up to be a large percentage of the persons monthly expenditures. Due to this type of situation, a person may feel like he or she is losing control of their financial situation.

When this happens, a person may choose to consolidate credit debt. When a person makes a choice to consolidate credit card debt, he or she will need to contact a non-profit service that will assist them. It is important that the consumer makes sure that any credit card consolidation service is a reputable business that will actually help them.

This can be accomplished by checking with the Better Business Bureau to find out the history of the company.

Counselors at these non-profit services can help the consumer by making a current list of creditors and the amount of debt owed each one. Then, the credit counselor will come up with a plan to propose to the creditors.

The consumer benefits by being able to consolidate credit debt. In other words, as a part of this type of plan, the consumer will end up making one single payment, instead of many different payments. In addition, the consumers overall debt responsibility should be reduced.

Credit consolidation counselors work with creditors to consolidate credit debt by proposing a reduction in or elimination of interest, and a lower monthly payment.

This allows the consumer to make headway with his or her debt and eventually pay it off. Credit consolidation counselors perform a great service to the debtor and the creditor in that they allow the consumer to repay his or her debt, and allow the creditor to recover a big portion of the debt that was originally incurred.

All in all, if a consumers debt has become unmanageable, a responsible choice is to sign up with a credit consolidation service in order to regain control of his or her financial situation. Doing nothing will not solve the problem, and in all likelihood, will just make it worse.

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Credit Card Phishing Scams

What Is Phishing? All new technologies come with their drawbacks and it is no different with credit cards. One of these drawbacks goes by the name of Phishing. When a person uses a fraudulent email or online shopping site to get hold of information about your credit card or bank, it is called phishing.

Phishing is easy which is why it is so popular with thieves. In the first instance, it begins with a cleverly phrased email that seems to come from your credit card company or your bank. It usually asks you to provide confidential details for verification. It may also threaten to close your account unless you give the necessary information. Another popular method is to set up fake shopping websites that only accept online credit card payment. You will never get the goods that were displayed. If you comply in either instance, you will end up with a highly inflated credit card bill and a sadly depleted bank account statement.

How To Protect Yourself From Phishing?

The best way to protect your credit card from phishing is to reveal information only after cross checking. Often, all you need to do is contact the concerned bank or company and confirm the email. A detailed scrutiny of the email before dashing off a reply also helps. Such emails usually do not have a salutation like ‘Dear Customer.’ The name of your Credit Card Company or bank will also be spelt incorrectly. Since anti-phishing scanners search text messages, phishers may enclose the message as an image. If your credit card requests are contained in an image, be doubtful.

In case of online shopping sites, beat the tricksters at their own game. For a first time purchase, use a credit card that is about to expire and has minimum credit. If the purchased item does not land at your doorstep within the promised time, at least your losses will be limited and you can be sure that the information cannot be used to perpetuate a bigger fraud.

International Credit Cards With No Foreign Transaction Fees

When traveling abroad, using a credit card can get costly. With the exception of one credit card Company, credit card companies charge a 3% international credit card transaction fee for all purchases made outside the United States. This 3% fee is generally hidden in the fine print of your credit card terms, but unless youre carrying a no transaction fee credit card, youll be paying extra for every purchase you make.

One way to avoid paying international credit card fees is to use your debit card. Although rules and fees vary from bank to bank, many national banks only charge a foreign currency conversion charge when you make a transaction. Unfortunately, there are a number of very major drawbacks to using your debit card to make purchases abroad. First, if someone steals your debit card info, your bank account may depleted before you realize it. This can lead to overdraft charges and other issues. Secondly, if your debit card is stolen, the funds that should be available to you in your bank may not be available for a substantial amount of time as the bank investigates your claims.

Clearly, this scenario could prove a nightmare. Imagine being stuck abroad with no available cash and returning home to spend weeks waiting for funds to return to your bank account.

Avoiding this scenario by using a credit card is must do. If your credit card is used fraudulently, you can contest the charges immediately and the money in your bank remains safe. Of course, paying a 3% fee for international credit card usage can cause a problem. However, simply apply for a credit card that charges no foreign transaction fees and you avoid excess fees and prevent all the issues that can arise when you use your debit card.

In addition to charging no international transaction fees, the same credit card company offers high limit credit cards. High limit credit cards offer consumers credit limits in excess of ten thousand dollars and, in many cases, up to twenty five thousand dollars.

Traveling abroad without a no foreign fee credit card can be more expensive and, in worst case situations, nightmarish. Using a debit card can obviously create some serious, time consuming and unnecessary financial headaches. Paying a 3% fee is generally worth avoiding the potential headaches, but since it is possible to avoid this fee, the best option is to apply for a credit card that doesnt charge a 3% international transaction fee.