Plastic Money_Credit/Debit/Prepaid 🙌 🙌 👈

You know most countries who are struggling with Tax Collections for decades as most of the transactions are not documented and are done on cash without receipts. By making plastic money mandatory we can easily trace the financial transactions done through cards 😲

Do you wanna know what is plastic money and its different forms? I can hear of course yes. 👎

Plastic Money 💴

is a term used to represent the hard plastic cards used in day-to-day life in place of actual banknotes? They come in several forms such as debit cards, credit cards, store cards, and pre-paid cash cards.

Some advantages of plastic money are minimizing the use of paper and saving trees, account tracking, reduction in currency printing costs, and anytime-anywhere banking. It allows customers to pay in exchange for goods and services without carrying cash. and that's why almost most countries are switching towards it.

hey, let me tell see what the difference in the three of them. ✊

Prepaid 💴

prepaid cards allow their users to make purchases until the time funds are available in their cards, similar to gift cards/vouchers. Let’s dig deeper into what a prepaid card is, how it works and how you can get one. Basically, it works as gift cards- meaning that they can be used to make payments with the amount that is already available in the card. which means that users do not borrow any money from banks/credit card issuers to make payments. Prepaid card users have to use under the limit (the maximum amount that is available in the purchase credit card) to make purchases.Banks/credit card companies may charge a nominal fee from the user for issuing a prepaid credit card.

• One of the biggest advantages of a prepaid card is that users can make transactions without having to incur any debts and/or pay interest in the future. Users can easily make their payments using prepaid cards through their mobile phones
• Prepaid credit cards also work as gift cards and travel cards, which can be used to make payments abroad
• Certain employers offer the option of transferring an employee’s salary to his/her prepaid credit card.

Debit Card 💴

Debit cards allow you to carry out transactions with the money available in your account. Most of these cards are either Visa or Mastercard, and they are accepted worldwide. These cards are linked to your current or checking account. All your payments or withdrawals are debited directly from your bank account. So there’s no risk of spending more money than you have. cards work on the amount available in your bank account and do not charge any interest on the money spent. If you have this type of card, it’s recommended that you regularly check changes in your account balance so that nothing goes away. 💴 You receive real-time notifications on your mobile phone so that you’re informed about everything that’s happening with your account.

Hey, what if you need money but you have already spent all of them, you are abroad and your money gets finished but you need it, and here comes the credit card. ❓ ❔

Credit Card_buy now pay later 💴

Credit cards let you borrow money from a bank under the agreement that you’ll repay it by your bill’s due date or incur interest charges.

There also can be some monetary perks to having a credit card, where cardholders can earn rewards on every purchase, which can be later cashed in for travel, statement credits, and more. Some credit cards also offer intro interest-free periods.

When you open a credit card, you receive a credit limit that can range from a couple hundred to thousands of dollars. You’ll be able to spend up to that limit.

Personal finance experts spend a lot of energy trying to prevent us from using credit cards — and with good reason. Many of us use credit cards irresponsibly and end up in debt. However, contrary to popular belief, if you can use plastic responsibly, you’re actually much better off paying with a credit card than with a debit card and keeping cash transactions to a minimum. Let’s examine why your trusty credit card comes out on top, and certain credit card uses and strategies to employ.

There are some other interesting facts about credit cards let's see what they are

Balance Transfer 😵

Moving outstanding debt on one credit card to another card — usually a new one — is a balance transfer. Credit card balance transfers are typically used by consumers who want to move the amount they owe to a credit card with a significantly lower promotional interest rate and better benefits, such as a rewards program to earn cash back or points for everyday spending.

What is a balance transfer credit card? Some credit card companies waive balance transfer fees (which typically range from 3%–5% of the transfer amount) to entice cardholders. Often, they might also offer a promotional or introductory period of six to about 18 months in which no interest is charged on the transferred sum. Although it’s called a balance transfer, one credit card actually pays off another. The cardholder gives the account information and amount to the credit card company to which they are transferring the balance and that company arranges the transfer of funds to pay off the account 👻

People who take advantage of these offers sometimes find themselves on the hook for unexpected interest charges. The problem is that transferring a balance means carrying a monthly balance. Carrying a monthly balance by not paying off the minimum amount due each month — even one with a 0% interest rate — can mean losing the card’s introductory APR, its grace period, and paying surprise interest on new purchases. The grace period is the time between the end of the credit card billing cycle and the due date of the bill. During that period (by law, at least 21 days but more often it's 25 days) a cardholder doesn’t have to pay interest on new purchases. But the grace period only applies if a cardholder is carrying no balance on the card. What many consumers don’t realize is that carrying a balance from a promotional balance transfer can affect the grace period if minimum payments aren’t made each month.

All the same, the Consumer Financial Protection Bureau says many card issuers don’t make their terms clear in their promotional offers. Issuers are required to tell consumers how the grace period works in marketing materials, application materials, and account statements, among other communications. Sometimes these statements aren’t even in the credit card offer itself, but elsewhere on the credit card issuer’s website.

Also bear in mind that many offers stipulate that the cardholder’s credit score determines the actual number of months of 0% balance transfer in the introductory period.

If the terms of the grace period for purchases after a transfer are unclear, options are to pass on the offer and look for one with clearer terms; take the 0% balance transfer offer, but don’t use the card for any purchases until the balance transfer is paid off; or choose a credit card that offers a 0% introductory APR for the same number of months on both balance transfers and new purchases.

CashBack

When you buy something, you get a percentage of the amount it cost paid back to you. This means cashback is a way of getting money off things you buy — think of it like a discount or incentive. It’s normally a feature of credit cards, but some current accounts also offer cashback.

Cashback is often offered on specific purchases, such as fuel or bills. But many providers now offer cashback on anything you buy. if a credit card pays 1% cashback on all purchases, you could earn £50 if your annual spend is £5,000. But make sure you pay your balance off in full each month, otherwise, the interest charges will almost certainly outweigh the benefits.

If you pay your credit card bill off in full every month, then cashback credit cards can be a great idea. This is because you’re getting rewarded for spending money you would have spent anyway. If you don’t always pay off your credit card bill in full, then cashback credit cards are not a good choice. Although you’ll earn cashback on your spending, this will usually be less than the interest charged on your outstanding debt.

The golden rule of cashback credit cards

"Always aim to pay off your credit card each month on time, and in full. If you don’t, any money earned in cashback will be taken away by interest owed or fee".

Rewards Points

Credit cards are set up to allow cardholders to earn one or more points per dollar in spending. Many reward credit cards provide bonus points for certain categories of spending like restaurants, groceries, or gasoline. When certain earnings thresholds are reached, points can be redeemed for travel, gift cards from retailers and restaurants, or for merchandise items through the credit card company’s online rewards portal.

Conclusion

Prepaid cards can be a good option if you don’t have a checking account. Parents who want to give their kids a limited amount of money can also opt for prepaid cards. Debit cards can be a good choice for anyone with a checking account since they provide easy access to your money and don’t need to be reloaded.bit cards allow you to spend money by drawing on funds you have deposited at the bank. Credit cards allow you to borrow money from the card issuer up to a certain limit to purchase items or withdraw cash. They offer purchase protection. ⚡️ ✌️ 🎻

Hey, there are so many more interesting things about the credit card you can explore on your own too. Hope you would like this, if yes clap below 👏 🎻