• Learning for LifeandWork

Credit cards: The advantages and disadvantages when buying goods

Updated: Jun 6, 2020

A credit card is a plastic card issued by a bank or business which allows the customer to borrow money to pay for goods or services. Organisations like MasterCard and Visa agree to give people credit up to a certain amount.

The advantages of using credit cards when buying goods includes:

  • Having a credit card can be useful for buying something and paying for it over an agreed period of time.

  • Using the credit card can be more convenient than using cash as you may not have cash handy to pay for something.

  • You can use a credit card to buy for something more expensive that you may not have all of the money for when buying, for example a holiday.

  • You can buy something there and then and pay it off in smaller monthly instalments over a period of time.

The disadvantages of using credit cards when buying goods includes:

  • Usually interest is charged to the amount of money owed on the card. However if you pay all that you owe off the credit card at the end of the month then there should be no interest charged.

  • If the credit card is lost or stolen this can cause concern for the person as someone may use the card to buy goods (fraud) especially on-line.

  • If you do not make the minimum payments each month to your credit card service provider, you could incur a fee and be charged a higher interest rate on the debt.

  • Some online shops/travel companies charge a small fee for using your credit card if under a certain amount making an online transaction which means you pay more than you had planned.


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