A credit card is a form of payment that allows you to make purchases with credit. The first credit cards were introduced in the United States in the 1950s, and nowadays credit cards are ubiquitous.
A credit card, its name suggests, offers credit, or a loan. When you buy something with your credit card, it is not directly deducted from your bank account, but you get a separate monthly invoice for your credit card purchases. Credit card purchases are therefore like a short loan which can be repaid at once or in installments. As with loans, credit card bills begin to accrue interest at the expiration of their non-interest payment terms, it’s just a good idea to pay off your credit card bills at once.
How does credit card work in practice?
In addition to credit cards, there are payment cards in Finland that work much like credit cards. These include the iconic Diners Club and Amex cards. Pay-as-you-go cards do not offer credit as such, but they do increase the pay-out time for larger purchases, just like credit cards. Because of this, charge cards are often referred to as credit cards in everyday language.
Credit cards therefore offer financial flexibility when used responsibly. In addition to financial flexibility, credit cards often offer a variety of benefits that make it a good idea to own a credit card. The cards may include, for example, travel insurance, price security or a loyalty program. You can check out the benefits of credit cards in our free credit card comparison.
How do I make a credit card payment?
Credit card payment is much the same as debit card payment, which is by entering your own PIN at the payment terminal and accepting the payment. The combination of cards is good to remember that if you want to pay by credit card in the shop side, chooses the payment terminal right side before you pay. The credit side of the payment terminal is called credit, and the bank fee is called debit.
The closest payment on a composite card usually comes from the debit side, with the exception of Good Finance’s composite cards. Proximity will only work if the debit card has a Proximity feature. The Near Payment symbol on the card indicates whether or not there is a Near Payment feature. If the card has this feature, you can pay for purchases under $ 25 by using a debit card near the payment terminal’s proximity reader. No PIN is required and payment will be faster.
When paying with a credit card, it is always a good idea to be careful and protect your PIN from outside eyes. If the card is lost or stolen, it is important that the PIN is not known to third parties.
Credit card payment online
Online credit card shopping is done by entering your card details into the payment form on the online store. The required information includes the cardholder’s name, card number, security code, and expiration date. In addition, the address of the cardholder is required. However, it is worth noting that your personal information will never require a personal identification number or birthday – if you reveal this information, identity can be stolen more easily. So you should be careful about your privacy when shopping online. Therefore, shopping on public machines should also be avoided.
Often, however, credit card information alone is not sufficient to make a payment, and online shopping requires two-step verification. 2-step verification generally means logging in with online banking, but nowadays it is often possible to verify a payment on mobile as well. In this case, a PIN code is sent to the mobile phone, which the customer enters into the pages of the online store. Occasionally, it can also be done through mobile apps.