3 ms·

Because you're leaving 2-3% on the table for every transaction. Using a credit card doesn't mean you can't pay it off in full every month, costing you zero in i

Because you're leaving 2-3% on the table for every transaction. Using a credit card doesn't mean you can't pay it off in full every month, costing you zero in interest, while taking advantage of reward programs.

Twisol 8mo ago
I have heard this, and it is probably a flaw in my approach to purchases. But is that really justification to ask "who in the world uses debit cards"? I still feel more comfortable not being on the hook to somebody, and the organizations that extend lines of credit don't do so as a prosocial program, certainly. (Just because some people can safely make use of credit doesn't mean everyone can. I know someone who has unfortunately made poor use of their credit card, and I don't necessarily trust myself to avoid a similar fate.)
- BenjiWiebe 8mo ago
  No, credit card companies aren't giving out rewards at a loss. Better cards have a higher interchange rate, ie the merchant pays more fees to accept a good card. Hence why cash discounts are a thing (and yes they're legal again).
wilcoooo 8mo ago
On top of all the benefits, if for some reason you get hit with fraud or scammed on a debit card, it's a lot harder to get that money back. Credit is an extra layer of protection.
- Twisol 8mo ago
  I've heard this, too, and it's a good reason to use a credit card at least for significant purchases. But I'd rather see those same protections extended to debit cards. I wish I understood why they aren't.
  - Spooky23 8mo ago
    The fees that fund those protections don’t exist on the debit card. It’s also fundamentally different. There are protections, but they depend on you being aware of the activity to avoid impact. Basically, in the event of fraud with a credit card, Chase or AMEX have a problem. With a debit card you have a problem until the resolve it. In the meantime, your payments and checks may not clear or hit overdraft. As long as you can control your spending, credit cards are a real superpower for consumers.
Sn0wCoder 8mo ago
You do realize that 2-4% is not left on the 'table' its taken from the merchant you are shopping at. If you are at a big box store sure but when going to local merchants its best for them if you use debit or cash. One could argue the merchant 'choose' to accept CC but in this day and age its more like extortion because the CC lobbyist were able to make it illegal to pass that charge onto the customer.
- Twisol 8mo ago
  I had this thought as well. I didn't want to raise it myself, because I don't have any personal evidence that this is the case, but of course the "cash back" has to come from somewhere.
- direwolf20 8mo ago
  In some countries they simply outlawed such high fees, merchants pay lower fees and there's no cashback.
- herewulf 8mo ago
  Don't you think the 2 to 4% is built into the prices of every merchant that accepts credit cards, big or small? It's not a great system but it's what we have so using debit instead of credit does mean losing out.
  - Sn0wCoder 8mo ago
    At the big box stores absolutely they have it worked in to the prices. I have no idea if the local mom and pop shops are working that 2-4% into their prices or not.
    - tyre 8mo ago
      Yes, they do. They understand where their margins go and the fees on credit cards are a huge one. They simply don’t have much of a choice.
    - phil21 8mo ago
      Mom and Pop stores are basically the only places left that reliably give you a cash discount for not using a card. Sometimes advertised at checkout, sometimes you need to ask. Especially service companies. They tend to quote out "cash" (aka check/bank transfer) price and then add another 5% or so if you want to pay via card. There of course is very often an even cheaper "actual cash" price too you need to ask for if you are so inclined.

Twisol 8mo ago

I have heard this, and it is probably a flaw in my approach to purchases. But is that really justification to ask "who in the world uses debit cards"? I still feel more comfortable not being on the hook to somebody, and the organizations that extend lines of credit don't do so as a prosocial program, certainly. (Just because some people can safely make use of credit doesn't mean everyone can. I know someone who has unfortunately made poor use of their credit card, and I don't necessarily trust myself to avoid a similar fate.)

BenjiWiebe 8mo ago
No, credit card companies aren't giving out rewards at a loss. Better cards have a higher interchange rate, ie the merchant pays more fees to accept a good card. Hence why cash discounts are a thing (and yes they're legal again).

wilcoooo 8mo ago

On top of all the benefits, if for some reason you get hit with fraud or scammed on a debit card, it's a lot harder to get that money back. Credit is an extra layer of protection.

Twisol 8mo ago
I've heard this, too, and it's a good reason to use a credit card at least for significant purchases. But I'd rather see those same protections extended to debit cards. I wish I understood why they aren't.
- Spooky23 8mo ago
  The fees that fund those protections don’t exist on the debit card. It’s also fundamentally different. There are protections, but they depend on you being aware of the activity to avoid impact. Basically, in the event of fraud with a credit card, Chase or AMEX have a problem. With a debit card you have a problem until the resolve it. In the meantime, your payments and checks may not clear or hit overdraft. As long as you can control your spending, credit cards are a real superpower for consumers.

Sn0wCoder 8mo ago

You do realize that 2-4% is not left on the 'table' its taken from the merchant you are shopping at. If you are at a big box store sure but when going to local merchants its best for them if you use debit or cash. One could argue the merchant 'choose' to accept CC but in this day and age its more like extortion because the CC lobbyist were able to make it illegal to pass that charge onto the customer.

Twisol 8mo ago
I had this thought as well. I didn't want to raise it myself, because I don't have any personal evidence that this is the case, but of course the "cash back" has to come from somewhere.
direwolf20 8mo ago
In some countries they simply outlawed such high fees, merchants pay lower fees and there's no cashback.
herewulf 8mo ago
Don't you think the 2 to 4% is built into the prices of every merchant that accepts credit cards, big or small? It's not a great system but it's what we have so using debit instead of credit does mean losing out.
- Sn0wCoder 8mo ago
  At the big box stores absolutely they have it worked in to the prices. I have no idea if the local mom and pop shops are working that 2-4% into their prices or not.
  - tyre 8mo ago
    Yes, they do. They understand where their margins go and the fees on credit cards are a huge one. They simply don’t have much of a choice.
  - phil21 8mo ago
    Mom and Pop stores are basically the only places left that reliably give you a cash discount for not using a card. Sometimes advertised at checkout, sometimes you need to ask. Especially service companies. They tend to quote out "cash" (aka check/bank transfer) price and then add another 5% or so if you want to pay via card. There of course is very often an even cheaper "actual cash" price too you need to ask for if you are so inclined.