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Learn the basics about credit cards and what they’re useful for.
For a quick run through, watch our short video.
A debit card is linked to your current account. When you use it, money is taken from your account balance.
A credit card is a separate account. When you use it, you’re borrowing money you’ll need to pay back later.
Those are the very basic differences, but there’s more to compare, including the costs for using each type of card. You might like to check out our guide to the difference between debit and credit cards.
1. What do you need a credit card for?
Most credit cards are created with a specific use in mind, such as card purchases or balance transfers, although some offer benefits on more than one transaction type.
2. Consider your options
3. Compare card features carefully
As well as looking at the introductory interest rates and the length of any offers, look at differences in account fees and charges.
The maximum amount you can borrow is also known as your credit limit. This is set based on an assessment of your personal circumstances when you open your account, but it can also change over time. For example, you could be offered a different limit, or you might request to increase or decrease it.
You’ll find your credit limit on your latest statement, or you can check it using Online Banking and the Mobile Banking app.
It’s good to know that if you go over your credit limit, or are regularly very close to the maximum, your credit score could be affected, which could affect your ability to get credit in future.
Credit cards can be used in most countries outside the UK.
Just keep in mind any fees which might apply when you make transactions abroad. It’s a good idea to check your account terms and conditions before you travel.
Most credit card purchases of over £100 and up to £30,000 are covered by Section 75 of the Consumer Credit Act 1974, which could come in handy if something you’ve paid for is faulty, doesn’t arrive or isn’t as described.
Credit cards are a flexible way to borrow money and spread repayments over time.