January 14 2008
by Peter Kenny
For credit card companies this is definitely not good news. They have been under a lot of pressure over the last year as their late fees have been slashed and they are constantly under the spotlight for things such as other fees and payment protection. All of the bad publicity has definitely made the credit card less popular and has caused a new rise in popularity for the debit card.
The main advantage to debit cards is that the overdraft facility is a lot better than the interest charged on credit cards. Most people can comfortably live in their overdraft each month and they often do not have to pay anything extra for that overdraft. However with a credit card you are charged interest on all of the balance. So you end up owing more than you should and than you would with a debit card.
Whether or not this trend will continue remains to be seen. Overall it is easy to see why debit cards are preferred these days over credit cards. Credit card companies will certainly be worried with the figures and it is likely that new deals will be introduced to bring back customers.