Credit vs debit

eskbanker

I feel like this allows me to have better consumer protection and fraud protection by using the credit vs the debit but I’ve also seen opinions that due to chargeback both are fairly equal these days

I’m spending maybe 600-800 a month on the credit card and paying off in full at the end of every month

In the context of protection, the key difference between credit cards and debit cards is section 75 coverage, as both offer chargeback, but s75 only comes into play for items costing over £100 (and that aren't bought via intermediaries), so for routine day-to-day spending, it's unlikely that a credit card really offers additional protection as such, although there are other advantages, as mentioned by other posters above…

molerat

With a, say 1%, cashback credit card that £600 - £800 spend per month is £6 - £8 pm in cashback. Not going to make you a millionaire but more than you are currently getting. At self service petrol pumps you need to have at least £100 in your current account to be able to use a debit card and in the rare case that hold doesn't come off correctly it is your money you can't spend - I rarely have that amount in my current account, why should I as it doesn't make me any money there. I currently have a 0% spend card which I run to £25 of the limit, alongside my cashback card, and the money that is sitting on that for 23 months is making me £20 per month in a savings account. It is all about how much effort you want to put in for the rewards, TBH there is very little effort involved but you do need to be aware of all your finances so it is not for everyone. It is just another small cog in the bigger scheme of making the most out of your money.

mta999

As mentioned above you could also consider a 0% purchase card for everyday spending - this means that for example with Tesco you get 21 months without needing to pay anything other than the minimum payment.

if that money is put in a 4% savings account you get a lot more than a cashback card would pay you

Jami74

The main reason I use a credit card is that there is then only one transaction coming out of my current account each month instead of many little ones. And I know in advance how much I have spent. Maybe not a thing anyone else cares about makes me happy.

maman

https://forums.moneysavingexpert.com/discussion/comment/81985614#Comment_81985614

Yes, @Jami74 , I agree. Although I check my statement regularly, I only have to do one lot of admin each month. That suits me fine!

Chocolatefund

https://forums.moneysavingexpert.com/discussion/comment/81985614#Comment_81985614

I'm the same. My cc statement date is the 27th, so when I get paid at the end of the month, I'll pay the card off in full.

I use the NaffWest rewards credit card for my daily spends. It's not the greatest cashback card in the world, but as it's my main bank there's no fee to have it. I also get the £5 a month in rewards for having direct debits with them. I spend around £600-800 a month which gets me around £6-£10 pound a month depending. So sometimes I'll get what feels like a free £15 a month.

I also like the fact that it separates my general spending form my bills/current account. Can see exactly how much I've spent.

Rich1976

I use a credit card for daily spending . It is beneficial as don’t need to constantly work out what is left in the current account to spend as there is just one bill to pay each month.

I have a cashback and non cashback card and I never get much in the way of return but just use a credit card as it is more convenient.

Smvthephotoman

Yes I must admit I do like the idea of just one payment going out to pay the card off. All of my spending is monitored and budgeted so I don’t overspend so that’s not an issue.

MyRealNameToo

Note that some debit cards have perks for being used too so given the OP is on a no benefits credit card they could also realise some of the listed benefits by moving to a cash back debit card. It's also worth noting that some places dont take any personal credit card (eg HMRC) so a cash back debit card can give perks where a credit card cant.

Chargebacks are identical on credit cards and debit cards, the rules are driven by the card network mainly. So the only difference is it's possible to have AmEx's rules applied for credit cards but not debit cards as no AmEx debit cards exist in the UK.

S75 is notably better protection than Chargebacks but it applies in much more limited circumstances given the need for the value of the item to be between two bounds and the direct D-C-S relationship required for it to apply. People seem to think both are magic protection against bad decisions but both have material limitations and always better to avoid the problem in the first place than live free and loose assuming its someone else's problem if it goes wrong.

I put all my spending on cards and pay off in full too but I do it more for the rewards of using the card and any protection is a nice add on… my main card is still a charge card so no S75 protection but has some of the credit card benefits and a few unique ones (no "cash like" transactions in the terms)