Saturday 17 August 2013

Credit card facts that the banks don't tell you

- If you cancel your card, it can still be billed, often for several months afterwards.

- You know how you're always asked to give your expiry date? Well, most banks don't care if it's right or wrong.

- You know how a card is a 16 digit number? The first six digits are a number that your bank gives to everyone (the bank identification number), and one of the digits is a checksum. So really, it's a nine digit number.

- Gift cards aren't like credit cards except in appearance. For example, with some gift cards (such as Westfield) any money on the card "disappears" after 12 months. And on some cards, there's a 3% fee for each transaction. Which? did a report on gift cards.

- You know how people are always telling you that you should change your password each month? Well, when your card expires (after two or three years) the bank issues you with a "new" one. But usually, the number is the same. And since your credit card number is like a password to your money, I do wonder why they don't change it every couple of years. Is there a shortage of 16 digit numbers?

- Everyone wants to issue you with a credit card - Amazon, Tesco, Paypal and Sainsburys for example. Why is this? Could it be that they make a profit out of you using their credit card? I went to the Tesco web site to find out what having one of their cards would cost me. I searched diligently, but no mention was made of an annual fee. I phoned them; the customer service person said that there's no annual or monthly fee. The Sainsbury web site says there's no fee. Paypal says there's no fee. Amazon don't mention a fee.

Does your bank charge you an annual fee? If they do, explain to them that you're thinking of changing to one of the above, maybe they'll forgive you the fee.

- different card offer different interest rates. Barclays web site, if you have "excellent credit history", offer 18.9%. Tesco (and the others) offer 16.9%. As a general rule, the retailers seem to offer better deals than the banks. I think it's obvious why.


  1. ok, loads there. One thing, checksum is a mathamatical check involving the numbers and is then checked somehow with the use of the last number, yes? Or is this a very closely guarded secret so no one can fiddle credit card numbers?

    I got stung by the gift card "expiring" I should of persued it as it was issued due to a faulty purchase and I guess would come under the sale of goods act somehow.

    One other thing you may or may not be aware of, if you give a company your debit card number for a reoccuring payment, your bank wont necessarily cancel the payment. It is down to you to stop it with the company you gave it to, I found this one out on the Acai Berry "Diet" so all we did was cancelled the card. That obviously cost the bank some money.

    Final, Esther, it doesnt really matter what the interest rate on a credit card is, you should really pay it off each month in full. Not knowing your situation, although you make a mention of excellent credit history, assuming you would qualify for an A rated credit card, it is still worth paying off cards with 16% interest rates! My poor rating, which only affords me one of those 40% plus cards does help me focus on my repayment dates!!

    Cheeky from Chalfont.

  2. It's no secret. Google the "Luhn check", you'll get the algorithm, it's pretty simple. The idea is that when someone gives their credit card number, you can instantly check to see its validity. It isn't a security thing, it's to detect accidental typos. And it is useful; it spots most typos and you can ask the user to re-enter the number.

    Yes, I always pay off my credit card.

    Interesting what you say about the Acai Berry scam - I hadn't known that anyone would fall for it.

    As a general rule, *DONT* give your debit card number. Always use a credit card. With a credit card, you get some legal protection that you don't get with a debit card.

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