When you fly on vacation at the latest, a credit card is a very popular and simple means of payment. With the plastic card, services or goods can be conveniently paid for without the use of cash. This saves you a lot of money, especially abroad when withdrawing cash. You can also use the card to withdraw money from ATMs. Consumers can choose from different credit cards with different conditions. Interested parties should pay particular attention to the details in the offer when entering into a contract so that there are no surprises when it comes to credit card billing.
What types of credit card statements are there?
The credit card statement can be compared to an account statement. This shows all sales generated when using the means of payment. It depends on the billing type, over what period and under what conditions the credit card billing takes place.
Overview of credit card billing types:
In general, a rough distinction is made between four different accounting systems. Most credit institutions summarize the card types mainly in the categories charge, revolving, debit and prepaid cards.
The charge card is one of the most commonly used forms of credit card in Germany. The holder of the payment method receives a credit card statement once a month. This shows all transactions made with the card. The cardholder must pay the invoice amount on the due date. The charge card offers the advantage of an interest-free loan for a short-term period, usually until the end of the month. In most cases, credit card holders have to comply with the monthly limit. This increases the availability limit. Some banks often offer credit interest on the terms of this type of credit card settlement.
The revolving card works similarly to the charge card. However, it is possible to pay off the total amount due in small installments. There are also differences in the amount of the installments. Some institutes determine the percentage of the turnover made. Others offer repayment using a fixed amount.
Cardholders must also pay the accrued interest in the event of a permanently negative balance. These are determined by the lender. As a rule, it can be expected that the interest rate will be high compared to many other loan offers. In addition, a credit check is usually carried out internally when using a longer-term loan. The advantage of this type of credit card settlement lies in the possibility of being able to completely balance the account at any time without additional costs.
Debit and prepaid card
In addition to the credit cards already mentioned, there is also the option of using a depit or prepaid card. The debit card as a credit card works similarly to an EC card. It is often issued as a bank card. However, it can also be found under the credit card billing types. The advantage is that it can be used for ATM withdrawals. However, an interest-free loan for a certain period of time cannot be achieved.
The prepaid credit card, on the other hand, works on a credit basis. This card also eliminates the possibility of an interest-free loan. However, customers benefit from global acceptance and the opportunity to make online purchases at home and outside of Europe at will.
Credit card billing: advantages and disadvantages at a glance
All types of billing have advantages and disadvantages, which are listed below:
- worldwide acceptance
- selectable in almost all online shops and payment options on the Internet
- all debits and credits at a glance
- Overview of foreign use
- Exchange rates for foreign currency can be seen
- Immediate blocking and replacement card possible in the event of theft (particularly advantageous for stays abroad)
- secure means of payment – in the event of misuse by third parties, insurance can step in
- high interest rates when using long-term loans
- annual fee for some cards
- Current account required as a billing account
Why should you check your credit card statement regularly?
Credit card fraud is not the norm. Nevertheless, it happens that criminals get important credit card data through dubious machinations. If you do not use your credit card so often, but only use the plastic card to pay for stays abroad or on vacation, you should still check your credit card statement every now and then. Because even when debiting small amounts that you cannot allocate, fraud may be involved. This could result in the debiting of higher sums. In the event of a verifiable incorrect booking, investigate the matter and report the matter to the police immediately. You will need the file number to present it to the bank. You will then normally be reimbursed for all amounts that are covered by the company’s insurance.
You should observe these rules when checking the credit card invoice:
- Go through your bank statements at regular intervals.
- In the case of unknown debits, it is best to contact the bank immediately.
- Have your credit card blocked in the event of unsolvable incorrect bookings.
- Report it to the police.
- Report to the financial institution and request a refund of the shortfall.