Fewer Shoppers Using Plastic this Season
Although end of the year shopping and last minute sales usually inspires most Americans to rely on their credit cards and put their purchases on plastic, the end of 2009 is shaping up to be an exception to the rule. According to a recent feature in the Wall Street Journal, fewer shoppers are using their credit cards and it is mostly blamed on the fact that many have had their credit limits shrunk, their cards cancelled, or their interest rates and other fees increased.
As the article explained, about 28 percent of those who use make purchases this holiday season will use credit cards, but last year the figure was more than 31 percent. According to experts the buying and shopping habits of the average consumer have changed over the past year in the wake of the fallout from the economic recession. VISA and MasterCard have seen more than a 10 percent decline in card use, according to one industry report, and the lack of use of credit cards seems to be replaced with more use of ATM cards. People often use a debit or ATM card when they want the convenience of carrying plastic but the budgeting power of paying right away instead of carrying a balance and paying additional interest charges.
But there is one place where people in general still seem to prefer to use their credit cards. As shopping over the Internet increases in popularity, so does the use of traditional credit cards like American Express, VISA, and MasterCard. The experts say that is because shoppers usually have more protections if they are not happy with a purchase or get ripped off by a seller who does not complete the transaction or send the promised merchandise when they use their credit cards. If a credit card is stolen, for instance, the liability to the consumer is usually limited to about $50 for most situations. But if you lose an ATM bank card you run the risk of having your whole account wiped out. So although credit card use may be slower this year, there are still some compelling reasons to use credit cards wisely and responsibly when making those end of the year purchases – both online and offline.
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