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4 kinds of people who hate credit cards

Credit cards are convenient and offer protection against theft and loss -- and, of course, some offer miles and other rewards. Not everyone is enamored with plastic, though.

By Credit.com Jul 29, 2014 1:13PM
This post comes from Jason Steele at partner site Credit.com.

Credit.com on MSN MoneyIt's easy for people to see the benefits of using a credit card. They offer the convenience of carrying around cash, while having protections against loss and theft. And rewards credit card holders can earn valuable points, miles or cash back when they use their cards to make ordinary purchases.


Worried man © CorbisFor merchants, credit cards offer a quick and easy way for customers to pay for their goods, and credit card payments are less vulnerable to fraud and theft than cash or checks. Furthermore, credit cards make it easier for customers to finance their purchases, which can increase sales.


Nevertheless, there are some people who simply hate credit cards.


1. Cab drivers

Taxi cabs were one of the last places where you couldn't use a credit card, and many cab drivers are not happy now that customers are increasingly using their plastic. In 2011, the Boston Globe reported that some cab drivers had to pay a 5% or 6% processing fee on credit card transactions, and then an additional $1.50 fee to withdraw cash from their accounts. (Though in Seattle, cab drivers were reportedly using their mobile phones to process payments with lower fees.)


2. Small-business owners

Business owners certainly have a love-hate relationship with credit cards. Sure, they do save money when customers use credit cards, as handling cash and checks takes time and makes them more vulnerable to theft and fraud. On the other hand, they have to pay merchant fees that credit card networks charge them for processing credit card payments. Convenience store owners complain that the market for credit card merchant fees is uncompetitive, and that the payment networks are earning too much profit. Yet their protests might seem a bit hypocritical to those who just paid $5 for a quart of milk.


3. Credit card users who are in debt

Convenience can be both the primary benefit and the main drawback of credit cards. Those who use credit cards simply as a method of payment avoid interest charges by paying each month's statement balance in full and on-time. On the other hand, some cite the convenience of credit cards as part of the reason that they overspend and go into debt. Since credit card debt is unsecured, interest charges can be costly and cardholders can have trouble paying off their balance. In the end, those who struggle with debt end up hating credit cards and may need to stop using them to control their spending.


Credit card debt doesn't just have short-term effects like interest charges either. Debt has a major impact on your credit scores. If you want to see how your credit card debt is affecting your credit, you can check two of your credit scores for free every month on Credit.com. You can also get your credit reports for free every year from AnnualCreditReport.com to check for mistakes or other problems that are hurting your credit.


4. People who don't know about the Credit CARD Act 

The Credit CARD Act is a landmark piece of consumer protection legislation that ended many of the most unfair and deceptive practices of the credit card industry. In the past, credit card issuers practiced an insidious form of accounting called double-cycle billing, in which cardholders were essentially charged interest on purchases that they had already paid for. Cardholders were also subject to "universal default" clauses where they could have their interest rate raised because of problems with other accounts, even if they always paid their credit card bill on time.


For the most part, the Credit CARD Act addressed these and other problems with the credit card industry. However, bad memories die hard, and many people still have a negative view of credit cards based on their experiences before the Credit CARD Act.


More from Credit.com


32Comments
Jul 29, 2014 2:08PM
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When I press on the link of 'Home onwership at 19-year low', it directs me to this article about credit cards. Fix your links.
Jul 29, 2014 2:43PM
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ME!  Guess that makes 5 kinds of people.  I don't believe in them.  I believe in paying cash, and if you don't have the cash, you don't need it.  I'm close to 70 years old and not having a Credit Card hasn't hurt me one bit!!
Jul 29, 2014 2:10PM
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It's a love-hate relationship,

The credit card user loves the purchasing power, but hates the monthly bill.

The retailer loves the extra business, but hates paying the merchant fees.

Tell us something we don't know.

Jul 29, 2014 4:40PM
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This country got along just fine, for decades without plastic so WHY the hell do people lose their financial discipline and think they have to have a card?
For me, it's CASH or crash! If I don't have the cash then I can WAIT or not buy it! THAT is discipline people!

Jul 29, 2014 2:52PM
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I got a alumni card from my college through MBNA at 7.99 fixed APR back in 2004.  MBNA was eventually bought by Bank of America who can't raise my rate because of whatever agreement at the time but their solution is to provide the worst customer service they can imagine.
Jul 29, 2014 6:34PM
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I only have one credit card and I pay the damn thing off twice a month, before any interest charges accrue, so the card company probably hates me....
Jul 29, 2014 4:11PM
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Credit card companies are basically fleecing the American people without them even realizing it.

If you had invested $10K in MasterCard stock at their IPO in 2006, you'd have about $160K today.  That's huge profit, all coming out of American's pockets.

The credit card thing basically took a service that was once free (processing checks), and turned it into a pure profit maker.  Since the profits are invisible to the consumer, most people don't even understand how badly they are getting shafted.
Jul 29, 2014 2:20PM
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The merchant is paying the fee for the convenience of having cash in theur account usually within 24 hours, instead of the float time of a paper check which can be up to a week . . . ..plus actually having to WALK to the bank . . . .to make a deposit, get change, etc.  . . .  ha ha ha
Jul 29, 2014 5:03PM
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You never hear about VISA in the news. They keep a very low profile. VISA is THE money processing company. Not a credit card company. Their profits are un-freakin believable.
Jul 30, 2014 11:06AM
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I love it when we the people rise up and assert our power. can't wait till November.
Jul 30, 2014 1:14AM
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How about people who can't afford credit cards, or can't get one? I'm paying mine off and closing them out one at a time and have just two left. I will keep only one of them. I'm using only my debit card anyway.
Jul 30, 2014 11:05AM
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the poor don't hate the rich for being poor. the poor hate themselves for being poor, but blame it on the rich. you see folks, we all need a scape goat.
Jul 30, 2014 11:17AM
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there will be no reset with Russia for another 2 years. if Hillary gets in than it will be another 6 years. think Europe can hold out for 6 years?
Jul 30, 2014 11:14AM
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if you know how to build up treasure without money, you are indeed truly rich. I can tell you how to make money but I cannot tell you how to do this. sometimes there is no how.
Jul 30, 2014 11:09AM
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to the clueless media outlets: the false flags mean we are now living in a false/phoney country.
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IF you love credit cards, you were brought up wrong with no care for personal strengths or mental abilities!
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