Life can be difficult if you can’t pay online in our credit-happy nation.Buying with credit cards from “˜Trade Me’ and online retailers is fact of life for most Kiwis. If having a credit card isn’t an option or isn’t desirable though, then a Visa or MasterCard debit card is a handy alternative.
Debit cards work like an ATM/EFTPOS card, but can be used to buy goods over the phone or internet wherever the Visa or MasterCard logo is displayed.
An alternative to a credit card
Some people don’t want credit cards. Or they can’t get them because of bad credit, bankruptcy, the No Asset Procedure (NAP), or they’re too young to qualify.
There are other sometimes good reasons not to have a credit card. Some people aren’t willing to pay the annual fees. It may be because they can’t trust themselves to keep their spending in check. Or they can’t resist spending and need a “plasectomy” AKA cutting up their credit cards.
A simple solution to your needs
Visa or MasterCard debit cards are usually linked to your everyday accounts, which means no monthly credit card bills to keep you up at night. What’s more, because you are using your own money, you don’t need to pay interest in addition to your purchases.
Most banks charge around $10 per annum for debit cards ““ although it’s worth asking for the fee to be waived as the banks will often waive the first year’s fees. Some do this for everyone, others for Gold Card holders.
Apart from the annual fee, the charges for using debit cards are usually the equivalent of using an EFTPOS card.
Assisting teens and tweens to shop online
Gamers, music buffs, junior shopaholics and others struggle to shop for the stuff that’s important to them without access to credit cards.
The banks often allow teens to have a Visa debit cards several years earlier than they can get full-blown credit cards and it can be a good way to learn how to manage online transaction without the temptation of falling into debt.