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Cash Finance - Many Australians are changing their habits of using credit cards. Instead of using credit cards, many have chosen to use debit cards when they do any purchasing. Compare to July and August, the total sum of purchases used by credit cards have fallen 1.5% less, meaning, the sum had fell $18.8 billion.

Differences between Debit card and Credit card:
Debit cards are actually connected directly to your bank account so you can use the money to buy goods or withdraw cash from the account. The amount of money you took out would be deducted straight away. Using the debit card, you may also use “cash back” when you buy goods from the shops for example at Myers. You simply go to the cashier, give them your card and ask for cash back, so you would be able to get money out. But be aware that not all shops offer this. The amount you get cash back would also be deducted straight away. When you use your debit card for cash machines or for paying goods electronically, you’ll have a PIN (personal identity number), a PIN would allow access to your account so you can do your payments or you may choose to sign instead.

Credit cards is used as a type of borrowing tool and is different to debit cards because you don’t have a directly linked account so your money cannot be deducted straight away. Credit cards allow you to buy your goods now and then pay your fees later, normally by the end of the month when all the sums add up from your credit card. Credit cards can also act like debit cards, buying goods in shops, over the internet or telephone. There’s also cash advance where you can draw your money out at bank cash machines.

Nevertheless, Australians are expected to increase their overall credit card debt as they begin to recover from the financial crisis and start to believe the economy would recover soon. This can be evident by the increase use of cash withdrawals which rose up to 2.1% in August.

Although the trend of recovery is positive, but some Australians are still struggling in repaying their debts, it is assumed that by Christmas, the debt would increase. Although there might me lower interest rates, but many people have quoted that they owe much more money compared to last year. Unfortunately, interest rates would now begin to rise and people would start to borrow more which means growing debt.

Getting your finance back in control is very important, know how to control and get out of the overflowing debt. Christmas is soon to come and no one wants a stressful Christmas with piles of debts stacked on your desk waiting for you to clear up. 

Cash Finance take no liability on content shown, please consult your legal adviser before making any financial decision