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> Because most banks offer cash back deals when you do. I get a 3% discount on all my transactions when I use my CC, some get points to travel for free. That's
by Denvercoder9 6y ago
> Because most banks offer cash back deals when you do. I get a 3% discount on all my transactions when I use my CC, some get points to travel for free.
That's an American thing, it's non-existant in Europe (at least in The Netherlands). Also, in the end it's not a discount, it's just your own money that you get back in an inconvenient way. It's paid from the creditcard fees that retailers pay, which pass it on to you (either directly as a fee, or indirectly as higher prices). The whole idea of e.g. paying less for gas when you pay in cash is insane in most of Europe.
> Credit cards help you build a good credit score to get better interest rates on loans and mortgages.
Credit scores are another American thing that seem insane to most Europeans.
- dudul 6y agoYes, and the article is about American CC. Why are credits scores insane? How do lenders evaluate if it's risky or not to issue a loan to an individual? How do you reward individuals who manage their finance correctly?
- kazen44 6y agoLending seems to be far less of a thing in most european countries. Not taking into account bussiness loands, the only loan most people take on in their lives is a mortage. (Which has a lot of requirements). Also, a "credit score" kind of system does exist in most countries, but it is usually an administrative record kept by a goverment agency which blacklists you from taking out more loans if you cannot pay them. It seems the system is mostly based around a negative feedback loop. (Punishing people who haven't payed) instead of a positive one.