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martin lewis has issued a warning to anyone using a debit card instead of credit card To pay them.
Money expert shares his advice BBC Explaining Podcast Why debit card can actually happen sometimes hard fee Compared to credit cards.
He said: “Many people think that credit card is badDebit card is good, but it is not that easy.
“If you have overdrawn, the debit card is a loan Cards too, and a typical high street overdraft is at 40 per cent annual interest, while a high street credit card is at 25 per cent annual interest.”
Mr Lewis pointed out that these higher interest rates could make it cheaper to pay off credit card debt Over debit card overdraft, but stressed that it is better not to take out a loan.
Credit cards also offer additional protection under Section 75 – a consumer protection right under the UK Consumer Credit Act 1974 that makes the credit card provider jointly liable with the supplier if something goes wrong during a purchase.
“If you’re buying something that costs over £100, up to 30 grand, and you pay for any of it, even a penny, by credit card, the credit card company is liable for the entire amount and is jointly liable with the retailer,” Mr Lewis said on the podcast.
“So, if something goes wrong you can go back to it. You’re just charged back on the debit card.”
Apart from this, using credit cards also offers rewards like cash back, the personal finance expert said.
He added: “On credit cards, you can also get rewards on your spending, with up to 5 per cent cashback for certain months and up to 1 per cent cashback on a regular basis.
“Again for many people, making the smart move, as long as you’re paying off your credit card in full every month and you’ve chosen the right credit card, it’s often a better way to spend than a debit card.”