DontSpendMore.com Blog

Category: Credit Cards

  • Getting A Credit Card For College

    By David

    So you are getting ready to head off to college with all its new experiences and new challenges ahead of you? If you have been considering getting a credit card, you may be confused about what kind is going to be best. To help you in your quest to find a credit card for college we’ll tell you a little about a couple of different types of credit cards, and why they may be of interest to you.

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    Prepaid credit cards

    Though not credit cards in the traditional sense, prepaid cards work in much the same way. In order to use them you must first load money on to them. This amount sets your “credit limit” and cannot be exceeded. The advantages of this type of credit card are many, making it a great credit card for college.

    1)      Learning – The point of college is to advance your education, and while credit card use may not be in your college’s curriculum, it is a vital life skill that needs to be learned. A prepaid card lets you do just that, spending at stores, online, or wherever your card company is accepted. The great advantage however is that it sets your family up as the lender rather than your card company. Allowing you to learn from your mistakes without paying for them (literally).

    2)      Security – As with any credit card, a prepaid card offers you security when shopping online or in the case of a lost or stolen card that far exceeds that of a debit card or cash.

    3)      Easy Money Transfers – In the event of an emergency where you need extra money quickly a prepaid card can be used as a medium to speed up this process. Rather than having to wait till morning to deposit money into a bank account, or driving all the way to a student’s location to deliver cash, a family member can just hop on their computer and deposit funds from their bank account directly to the student’s card account.

    Low interest credit cards

    This type of card works like a normal credit card except that it has a lower than average APR (annual percentage rate) that typically falls around 10.4% This lower rate means that you pay less interest over time on your purchases. This advantage over a regular card is what makes this another great credit card for college.

    1)      Emergency Line-of-Credit – In the case of a sudden emergency outside a student’s present means a low-interest credit card can be used to get them what they need without costing them more in interest than they can quickly pay back.

    2)      Gentler Life Lessons – Knowing that we all eventually make mistakes and that it’s just part of the learning process you can take some comfort in knowing that overspending one month isn’t going to bankrupt you for life.

    Choose a card that is right for you

    Now that you know what your best options are, you can make an informed decision about getting a credit card for college.

    Click here to compare 0% student credit card offers. Free comparison tools, great rewards, the best cards in one place.

  • How To Compare Credit Cards

    By David

    How to compare credit cards when you have so many options and confusing jargons to deal with. With so many different and varied types of credit cards available today, it is a wonder that anyone can find one that is right for them. In fact, the list of possible cards is so massive that to attempt to compare cards in just a few pages would be absurd. In recognition of this fact it seems more sensible to show you, our readers how to go about comparing credit cards so you can find one that is a good fit for you.

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    Types of credit cards

    1)      Prepaid Cards – A prepaid credit card varies somewhat from other credit cards in that you pay it before making purchases rather than after. Because this makes you the lender there is no interest for its use and it does nothing to build your credit. However these cards have all the security of a normal credit card and a spending limit set by how much you pay into them, making them a great option for online shopping.

    2)      Low-Interest Cards – A low-interest credit card works in much the same way as a standard card except that it has a lower than average interest rate (usually around 10.4%). These cards are great for balance transfers from higher interest cards and for using as a means to paying for something large in an emergency.

    3)      Rewards Cards – As you compare card you’ll want to check out the rewards cards that are available. These cards, though they have a higher APR (annual percentage rate) than a low-interest card, offer extra perks like frequent flyers miles or cash back just for using them. They are great to use for everyday purchases so long as you pay them off before the end of the grace period allowing you to reap the rewards interest free.

    4)      High-Interest Cards – These cards are designed as a way for those with bad or no credit to start making some positive inroads. They have higher than average APR and low credit limits. It’s best to go with this type of card only if you’re trying to build or repair your credit.

    Interest Rates

    Once you compare card types you’ll want to take a look at the APR of your front runners. Obviously you’ll want the lowest possible APR you can find to make certain that you are not paying more on your purchases than you have to.

    Introductory rates and fees

    The final consideration is going to be the introductory program (if there is one at all) and any fees attached to the cards use. Introductory programs can be nice, but the APR you ultimately end up with should be of greater concern. Similarly while certain rewards or a low continual APR can be tempting, they are sometimes not worth an annual fee, when other cards are just as good and do not have the associated fees.

    Now that you have an idea what to look out for, you now know how to compare credit cards and come up with the ones that are right for you.

    Click here to compare low APR credit cards with cash back rewards, travel points, and more. Free comparison tools.

  • College Credit Cards Demystified

    By David

    College credit cards may not be the next fashion statement, but as anyone who has had a taste of life on a college campus will know, there are times when you have more money than you need, and times when even a package of noodle soup is an expensive proposition. To help ease this disparity and provide a way for students to pay for emergencies many colleges have begun to offer credit cards to their students. This has generated controversy as some suggest that a college credit card is a necessary tool for students, while others believe they are an early path to debt slavery.

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    Risks

    There are those who believe that college credit cards are little more than a means to trap the next generation in early debt. With most students already incurring thousands of dollars in student loans each year, it does raise legitimate concerns about a student’s ability to pay off their debt once they are out of school. With students out on their own for the first time, the chances are high that they will want to spend more money than they have, and if they have a card they will have the means to. With the temptation to overspend so great, those without a high level of discipline may want to reconsider.

    Rewards

    Despite their dangers, college credit cards do offer benefits that make them worth considering. The use of a credit card in college, allows students to begin building credit before they leave school. Additionally credit cards include security features that are simply not present with a debit card or cash that actually make them a safer spending option. Combine these facts with the knowledge that a credit card will allow a student to get groceries, or pay a large bill in an emergency while reaping extra rewards like cash back on all their purchases, and the rewards seem to begin outweighing the risks. If you believe you have the discipline to use a college credit card the way it is intended to be used, than you may wish to consider applying for one.

    Things to look for

    If you have decided that the rewards are greater than the risks and you would like to try and find a card that is right for you, there are a few features you will want to try and get on your card.

    1)      No Annual Fee – Unless the interest rates are too good to pass up, or the rewards make a card with an annual fee worth having, try to find one without.

    2)      Low APR – The lower the interest rate you can find the better off you will be, especially if you intend to use the card primarily for emergencies

    3)      Useful Rewards – It is always nice to get something back and even more so when it is something you can actually use. Cash back is one of the best rewards options, as it is always good to have a little extra cash.

    Hopefully, you’ll heed the above advice and cautions in order to make your experience with a college credit card a pleasant one.

    Click here to compare 0% APR student credit cards and save money. Win cash back rewards, travel points, and more. Free comparison tools.

  • Making A Card Payment

    By David

    Card payment is not just a ritualistic chore. Most all of us these days know how to put purchases on our credit cards and even how to pay those purchases off when we get our statement at the end of the month. However, what many do not know is that there are some other — often times more convenient — methods for making a card payment.

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    Send a check

    This is the method you are likely most familiar with. You get your statement at the end of the month, sit down with your checkbook, fill out a check for the appropriate amount, and then seal, address, and stamp your envelope before finally sending out a card payment. This method, while familiar takes a fair amount of time out of your day and can take a few days to arrive meaning your card company may try to charge a late fee. While these fees can be removed with a phone call to customer service so long as the payment was postdated before your due date, it is more time wasted and an extra hassle none of us need.

    Over the phone

    A new option for making a card payment open to bill payers is to call customer service to make your payment. This approach has a few advantages over the traditional method. First and most notable is personalized service from an actual person. They walk you through the process and help you make your payment, even offering time saving options for future payments like saving your information. The other great advantage is the flexibility in how and when you can pay. You can still pay with a check if you prefer, or you can use your debit card instead; and with everyone owning a cell phone these days you can literally do this from anywhere. So if you find yourself at work and realize you forgot to send out that card payment, don’t worry. You can call on your break and make a payment right over the phone in a matter of minutes.

    Online

    The last and arguably the best option available for making a payment is the online method. Every credit card company has a website that you can use to access your account, see a list of transactions, and make a card payment. The best feature of this method is the ability to save your payment information once you’ve entered it the first time. This allows you to log in and make a card payment in just a fraction of the time, or even set up automatic payments so you never need to login again. The automatic payments feature, once set up will simply charge you (typically through a debit card) the minimum balance due for that month without needing any input from you. This is great for those times when you accidently forget to pay one month as it helps you to avoid late fees.

    So the next time you go to make a card payment be sure to consider what method is going to work best for you.

    Click here to compare low interest credit cards and save on your monthly bills. Compare the lowest APR credit cards using our free comparison tools.

  • Credit Card Declined: Reasons Your Card Did Not Go Through And How To Handle It

    credit_card_declined copy“Credit card declined. Sorry your transaction did not go through.” Whether at a supermarket or on a much-coveted dinner date, no one wants to hear these words from the merchant. Apart from the subtle overtone of an insult, one simply stops and wonders: “Why is my credit card being declined even though I haven’t maxed out on my credit line?” From the obvious to the not-so-well-known, there could be several reasons why your credit card may be denied authorization.

    In this post, we will share some common credit card declined reasons and also focus on how you can handle these denials.

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    Have you maxed out on your credit limit?

    If you have maxed out on your $5,000 credit limit, the reason is very simple: You simply do not have adequate available credit and the company is not going to honor the transaction. While some issuers have stringent “do not honor credit card” policies in the case of over-the-limit transactions, others will bend their policies a little for good customers, especially if the occurrence is a first time issue. On the other hand, some companies will let a few dollars slip through and surprise you with some form of penalty or finance charge. Blame it on the fine print!

    What you can do?

    If you don’t have a backup funding source (an alternate credit card, debit card, or e-check), call your credit card issuer’s toll free number or customer service helpline. If you have been a good customer and have an otherwise strong track record with payments, chances are the credit card company may increase your credit limit on the fly.

    Furthermore, some companies have online portals where you can request a credit limit increase and in most cases the decision would be provided almost instantly. If approved, the limit increase may take effect immediately, unless specified otherwise in the contractual agreement governing the limit increase.

    If that does not work and you have bank accounts linked to the credit card company (as payment sources for billing purposes), try making a payment online to reduce the balance owed. Depending on the company’s policies, your payment may nor may not be reflected immediately. In some cases, you may have to wait twenty four hours (or one business day) before the payment clearance and recording.

    Finally, you can request the customer service representative to allow the transaction to go through without any penalty. In some cases, especially first instances, they will honor the request but the decision would vary with each individual company’s policies and terms. If your customer service representative cannot help you, try speaking with a higher up such as a supervisor or manager. Often, supervisors have much more discretionary decision-making authority than front-line customer service associates. A little escalation can benefit your cause.

    Is the credit card being declined due to suspected fraud?

    Another common reason for credit card decline is that the issuer does not trust the transaction as being legitimate. Sophisticated phishing sites and credit card scammers often steal credit card numbers and rack up purchases in an organized manner. Billions of dollars are stolen from unsuspecting victims every single year. If the company suspects that your card number was stolen, it is possible that they will become extra vigilant and deny transactions they suspect as being “fraudulent”. Financial systems have advanced significantly and more often than not the red flags are placed by automated systems without the need for human intervention. A live representative can override the system’s decision if permitted by internal policies.

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    Several factors could trigger this suspicion. Let’s consider a few:

    – Unusual activity. Let’s say you have a five-year track record with the credit card company and during these five years you have never authorized any sort of casino-related transaction. If your card suddenly shows a $2,000 charge from a “Happening Casino” in Vegas, the credit card company may suspect theft and place a temporary hold on the transaction.

    – Frequent activity. Another cause could be the frequency of purchases. If you are the sort who makes weekly purchases on a regular basis, a sudden burst in activity (as in too many purchases within an hour) could raise some red flags with automated systems and cause your card to be flagged and declined.

    – Large purchases. This one’s a no brainer. A sudden $5,000 vacation package purchase may put the company’s systems on red alert.

    What you can do?

    Call your company before-hand to obtain pre-authorization if you are going to engage in one of the unusual purchases. Some credit card companies will take in a request for pre-approval, while others won’t. You will have to call your credit card company to figure that out.

    The same can be applied after-the-fact as well. Let’s say your purchase for a new laptop was denied. Call your credit card company and verify your identity. Once they are certain that you are a genuine customer, they will let the transaction fall through in most cases. Again, internal policies govern the rules.

    Are you exceeding your daily limits?

    While most users are aware of the total available credit card limit, many are not aware that some issuers, especially debit card issuers, impose stringent daily spending limits.

    Let’s say you have a credit line of $10,000 and a daily spending limit of $500, it means that you cannot charge or withdraw (as cash advance) an amount over $500. So, if you decide to splurge on the coolest gadget on the market, chances are that your transaction will meet the proverbial “credit card decline” almost immediately, especially if the cost of the gadget is over $500.

    What you can do?

    Most merchants will allow you to use two (or more) credit cards as funding sources if the purchase is for a larger amount. In this case, you can use two funding sources (two credit cards, combination of credit and debit card, combination of credit card and e-check, and other approved combinations) to foot the bill for your purchase.

    Are you stretching your boundaries?

    If you live in New York and make a sudden purchase from a ghost town in an unfamiliar country or a country or region flagged for its nefarious activities and organized crime rings, there is no way the transaction will pass through security screens even if the transaction was genuine and authorized by you. The reasons are obvious but again you can work with your credit card company to ensure your transaction passes through security screens.

    What you can do?

    Speak with your issuer before you initiate your purchase and get a pre-approval. Inform the provider that the transaction is legitimate and that you have authorized the purchase. While most companies may allow the transaction to pass through, some will still refuse, especially if an organized crime ring is regularly scamming the credit card company’s consumers.

    In this case, you will have to make alternate payment arrangements, such as a money order or an instant wire transfer.

    Common sense approach

    If denied, your first response should always include calling your credit card provider to work out any issues you may be having, including billing issues, credit limit related problems, and unusual purchase behavior.

    Always keep an alternate credit (or debit) card handy for emergencies. If you are unable to obtain a second credit card, consider keeping a debit card or prepaid credit card handy. You can purchase such cards online. You can review our selection of prepaid credit cards as well.

    Receiving a credit card declined message is not fun, especially if you are initiating a genuine purchase for a product or service. Though frustrating, bear in mind that the denial is for your own good, to protect your card from unscrupulous financial bandits who will not just make money off your hard-earned credit history but also cause your credit score to nosedive. Here are some quick resolutions you may want to remember:

    – Call your credit card company’s toll free number

    – Obtain pre-authorization before you start the purchase process

    –  Ensure your payment history is always on track

    – Regularly review your activities to spot for irregularities

    – Think from the credit card company’s perspective

    – Try to have alternate financial instruments in your wallet (additional credit card, debit card, prepaid credit card, check)

    – Know your provider’s terms and conditions, especially clauses related to daily spending limits, total available credit limit, and other similar terms

    – Try to keep your “amount owed” figure to the bare minimum

    – Visit your credit card company’s website on a regular basis and request limit increases when appropriate

    – Know the merchant you are working with; check their reputation and dispute history

    – Don’t provide your credit card number to companies suspected of illegal activities

    – Avoid purchasing from foreign countries, unless absolutely necessary

    – Check your merchant’s security certificate before buying; most browsers will provide basic information about a site’s security certificate

    – Finally, don’t forget the green bills when necessary; cash still rocks!

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    Credit Card Declined: Reasons Your Card Did Not Go Through And How To Handle It was authored by Nimish Thakkar. Nimish is the CEO and founder of DontSpendMore.com. He holds two graduate degrees, including an MBA in Finance. He is a published author who has appeared on thousands of news sites, including The New York Times, Reuters, and several globally-reputed media organizations.

  • Pay Credit Card Online, Save Time And Money

    Pay credit card online and save yourself both time and money. If you are one of the millions of credit card users to have been hit by late fees and penalties, you know all too well about the importance of avoiding missed credit card payments. Despite our best efforts and intentions, though, life has its way of throwing unexpected emergencies our way.

    Don’t let these incidences throw you off-track on your payments. In this article, we will share some simple, easy-to-implement strategies that will help you make your payment online and ALSO save money by automating and streamlining the overall process.

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    We generally create our posts in response to our user’s questions. Today we will address a common question “How do I pay my credit card online?” This basic guide provides some tips and strategies.

    With most companies, the pay-by-phone option is still available for customers who prefer to speak with a “live person.” On the other hand, paying your credit card bill online can be accomplished through either your credit card company’s website or through your bank.

    We will explain each of these in further detail:

    Pay credit card online through your credit card company’s website

    Fortunately, most credit card companies allow you to pay your credit card online through an automated Web-based system. Once you register your account and link a basic checking account on the site, you can schedule regular payments either automatically, at pre-specified intervals, or up to a year in advance.

    If you keep a certain amount of money in your bank, using the auto pay feature is the most convenient option. You can specify on the company’s website whether you want to pay the full amount, minimum balance, or a pre-specified amount that you determine.

    What you will need:

    – Register your account information online (credit card company’s site)

    – Link your checking account information to make the credit card payment (payment source)

    – Ensure you have sufficient funds to cover the payment

    – Establish payment frequency — one time, auto pay, schedule payments in advance, and other options.

    This is a very convenient strategy to make a credit card payment online. In addition to paying the credit card bill itself, you can also use the company’s “online bill pay with credit card” feature to link other monthly bills with your account. The bill pay option would allow you to pay other monthly bills using your credit card. One caveat, though, make sure you don’t carry a high balance as you may accrue interest fees and other charges. The process should be a matter of convenience, not expense.

    Remember, credit card companies could benefit financially if you exceed the grace period. It is in your best interest to avoid incurring interest charges. The card issuer would be happy to levy the interest on your account if you exceed the grace period.

    Is there a fee to pay my credit card online?

    In most cases, the bank will accept the payment and facilitate the transaction at no cost to you. If you pay your bills on time, it benefits them as well. So, in most cases there shouldn’t be a fee but it is always a good idea to check with your credit card company and review the fine print terms in detail. The last thing you would want is to pay another bill.

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    Pay your credit card bill through your bank

    With larger credit card companies, setting-up online bill payments with your bank should be a very easy process. In most cases, you will be able to do it electronically. But if your credit card company does not offer a large network, online payments may not be feasible.

    In this case, you can instruct your bank to pay your credit card bill via a physical check. Most bank bill payment systems offer this feature free.

    What you will need:

    – Create a bill pay account within your bank’s system

    – Register a payment source (your checking account)

    – Setup an account specifying your credit card company’s account information and other payment details, such as a mailing address

    – Establish a payment frequency and an amount

    – You can schedule payments in advance, setup auto pay, or perform the payment process manually

    Key benefits of paying your credit card online

    – Financial health/credit score. Research has shown that individuals who pay credit card bills online, end up with fewer penalties and a much higher credit score. Since the payments will be made on time, every single time the discipline and payment frequency will show up on your credit report and boost your overall credit score.

    Apart from the benefits on overall financial health, paying credit card bills online has some minor additional benefits as well.

    – Reminders. If there is an issue with your payment or if you miss your payment date, the system will be able to send you a reminder e-mail. This is certainly a very important benefit for busy professionals and over-worked individuals.

    – Convenience. We love the fact that one can setup automated payments or schedule payments several months in advance. Even if you are on vacation or away for a business meeting, the online system will complete the payments in a disciplined manner.

    – Other perks. Some credit card companies reward on-time payments with points, rewards, cash back bonuses, higher credit lines, and other similar incentives to encourage on-time payments. Why would you want to miss out on these benefits for payments that you will be making anyways.

    – Support. If you use your credit card company’s payment system, you will be able to take advantage of the support, tools, and knowledge base created within the company’s infrastructure.

    – Control. Most importantly, you will always be in control of how often and how much you pay. It is akin to delegating and micro-managing at the same time.

    We hope you liked our article Pay Credit Card Online, Save Time And Money. If you found it useful, kindly let us know in the comments below. As always, we would be happy to assist you with any questions you may have. Our site helps consumers save money every month, so do check out our offers, deals, and tips at DontSpendMore.com.

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  • Revolving Credit: How It Works

    Revolving credit line is one of the most common jargons used in the world of financial products. From credit card commercials and pre-approved solicitation letters to online advertisements and personal finance literature, it is impossible to miss revolving credit or revolving credit line. Yet, in an ad hoc survey, we found that over 85% of credit card (and loan) users were not familiar with the term revolving credit, what it signifies, and how it works as far as credit cards are concerned. What’s worse, even borrowers who were using these very products did not know the difference.

    In response to our questions, we received either vague, almost impromptu, definitions or strange guesses — revolving credit means credit cards that are rotated on a routine basis sorts — that were accompanied by “not sure” shrugs. No one is going to fail you an exam for not knowing the definition but being aware of the implications of different financial products can certainly help you make more informed choices and choose financial products that will save you more money as opposed to draining your wallet. An added benefit would be the avoidance of nasty surprises in the form of late fees, penalties, and other finance charges that most of us would prefer to avoid.

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    So, what exactly does revolving credit mean?

    Unlike installment credit (or a term loan), revolving credit does not have pre-defined, iron clad number of payments and fixed period of maturity (or an expiration date). In other words, the borrower is not required to pay fixed installments to repay the loan in full within a fixed duration of time. Although the borrower is free to make good use of her/his credit line, the total available credit fluctuates (increases, decreases, or remains the same) in response to how much the user withdraws, uses, and repays. The actual amount used (as opposed to the total available credit line) determines the monthly payment amount and total interest component.

    Furthermore, the borrower is allowed to reuse the amount as many times as desired as long as the total credit line is not exceeded. This flexible nature of borrowing, repaying, and reusing is probably the prime reason where the name revolving credit line comes from.

    Another significant feature of revolving credit is that the monthly payment amount is not fixed either. It varies and is pretty much controlled by the borrower (barring mandatory minimum payment requirements). It is true that a minimum payment is recommended and required, but the user can pay more (or as much) at her/his own discretion. This flexibility in payment duration and amount is not available on term loans and these variables are generally determined by iron-clad contracts.

    Example: Let us assume User A has a revolving credit line of $2,000. During the month of January, he uses $600 and repays $300, such that during the following billing cycle the actual amount used over the course of the billing cycle is $300. In this case, he will be paying interest only on $300.

    With credit cards, borrowers do enjoy a grace period and if a full payment is made within this grace period, interest does not accrue and most of the payment will go toward the principle as opposed to the interest component.

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    What is the difference between revolving credit and installment loan (or term loan)?

    The main difference between revolving credit and installment (or term) loan is that with revolving credit, the number of payments is not fixed and the borrower is free to borrow, use, pay, and re-borrow up to the total available credit line. Further, the interest rate is charged on the actual amount used, not the total available credit.

    With an installment loan, however, this feature is not available and the user is required to make a fixed number of payments at pre-agreed intervals. The amount of payment is fixed as well.

    Revolving loans are another product wherein the process works in a similar manner as revolving credit cards, but generally the former have a date of termination which is renewable at the discretion of the lender. Revolving loans are commonly available as revolving loans (for individuals), business loans, refinance loans, rollover loans, and the like.

    Businesses prefer the flexibility inherent in revolving loans as it provided much-needed cash flow for operational purposes on an as-needed basis. As such, revolving credit is available for both corporate customers as well as individuals for personal use. A vast majority of small businesses will be using flexible credit lines to finance business activities.

    So, what’s the good, bad, and ugly on revolving credit loans (or revolving credit cards)?

    Well, the good is obviously that you do have a lot of flexibility in terms of how and how much you use and pay. Also, you are not tied down to a fixed term duration and the credit is available for you perpetually (at least in theory). In reality, however, an expiration date does kick in but it is often renewed automatically — unless, of course, the borrower defaults or causes one of the “red flags” to kick in.

    Another benefit of revolving credit is that the user is not required to use the credit for pre-specified purposes that are agreed-upon in the contractual agreement.

    The bad and the ugly, on the other hand, arise from the possibility of going overboard on the spending. Further, the interest rate on these credit cards and loans is much higher so the overall amount that will be repaid at the end of the credit period will be very high — much higher than the originally borrowed amount.

    Lenders do tend to be very enthusiastic about revolving credit lines as they have more flexibility with credit lines, interest rates, finance charges, and the like. In that respect, the flexibility balance tilts in their favor as well. High interest rates are another factor that could be very lucrative for financial institutions.

    As always, read the fine print carefully to ensure you don’t get caught off-guard. If you don’t understand your contract, consult an attorney. If you can’t afford one, there are plenty of non-profit organizations that will assist you with contract interpretation and negotiation.

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  • What Is Card Security Code: CSC or CVV

    If you have ever had to make a payment online (card not present transactions), you should be familiar with Card Security Code (CSC). For Mastercard* and Visa*, it is a three-digit number whereas for American Express* and Discover*, it is generally a four-digit number. Card Security Code is recognized by various acronyms depending on the industry, product, or service you are working with:

    Card Security Code (CSC), Card Verification Value (CVV or CVV2), xCard Verification Value Code (CVVC), Card Verification Code (CVC or CVC2), Security Code, Credit Card Security Code, Debit Card Security Code and some other variations

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    What is Card Security Code (CSC) and why do merchants ask for it?

    Basically, your Card Security Code is an additional layer of protection to prevent fraudulent transactions. Every credit card would have the Card Security Code physically imprinted on it. It is just like your credit card number and expiration date. The combination is always unique and is an enhanced safety mechanism as these codes are generally not printed on receipts or stored in internal systems.

    Merchants would generally ask for the CSC in addition to your credit card number and expiration date. Some merchants will have strict matching requirements so your mailing address must match with the credit company’s records to the T. Even the slightest variation could cause the transaction to fail. In reality, many merchants do not setup their payment processing systems at the highest security levels. Primarily, to make the process easy for consumers and avoid transaction failures for even small data errors.

    If you are able to verify your mailing address and Card Verification Value (CVV), merchants can be assured that you are in physical possession of the credit card and not some scammer who has hacked into an online credit card database to unscrupulously download credit card numbers and rob innocent victims.

    Chargebacks are another reason why online merchants and E-commerce stores ask for CVV numbers. If the transaction has a security code associated with it, the transaction would be considered a legitimate transaction that the owner of the card probably consented to. It is not a guarantee that the transaction was legitimate but certainly proves that an additional barrier was accurately verified. Just one more defense in the merchant’s arsenal should the credit card owner question the legitimacy of the purchase.

    Not all merchants ask for the Card Security Code number, though. Some online storefronts setup their payment processing systems at moderate or low security levels (for reasons discussed earlier) and often bypass the CVV requirement to make transaction processing a breeze for customers.

    Where to find the Credit Card Security Code?

    Fortunately, that is not the hard part. The Card Security Code is physically imprinted on the credit card itself and is very easy to spot. Generally, Discover, Mastercard and Visa follow a similar protocol when it comes to the security code, whereas American Express has its own protocol. Discover, Mastercard, and Visa make use of a three-digit security code, while Amex uses a four-digit number.

    How to find the security code on Mastercard?

    For Mastercard users, simply flip the card the three-digit CVV code for Mastercard is generally the last three numbers you see on the back of the card (toward the right).

    As a rule, merchants are required not to store the CVV code so even if other variables are hacked, CVV will still serve as a final layer of protection against deceptive purchases.

    How to find the security code on Visa?

    For Visa credit cards, the Card Verification Value (CVV) is found in a similar manner. It is the last three numbers you see on the back of the card (extreme right).

    How to find Discover’s CSC Number?

    Discover again follows a similar protocol: Last three numbers on the back of the card.

    How to find the CVV code number for American Express?

    American Express uses a four-digit number that is normally on the front of the card. These four numbers could be found just above the credit card number (toward the right).

    Debit Card Security Code

    Do debit cards have a security code as well? Yes. If you see a Mastercard or Visa logo on the debit card, the security code can be found in the same manner as you would on a regular Mastercard or Visa credit card: The last three digits on the back of the credit card. If your debit card does not have one of the association logos, ask your issuer as to how you can find the CSC code number.

    Do prepaid and gift cards have a CSC as well?

    Each issuer would have its own protocol for the security code but as a rule of thumb, you would find the code the same way as on a regular credit card. Mastercard, Visa, and Discover cards would use a three-digit number (reverse side) whereas Amex would have a four digit number on the front.

    A word of caution when it comes to providing your Card Security Code number

    Generally, CSC codes are not printed on purchase receipts and that is the primary reason why they are considered to be “relatively hacker safe.” Further, merchants are required to avoid storing the CVV number in their internal systems and databases. Whether all merchants comply with this requirement is something we are not aware of.

    As a precaution, treat the CSC as if it were your Social Security Number. Check the reputation of the merchant you are making the purchase from. Read their online reviews and complaints to ensure you are not giving away your CVV code on a phishing site. Scammers often setup phishing sites that look like legitimate merchants in an attempt to extract your personal information. Make sure the site is secure and the merchant is legitimate. If you have any doubts, call the 800-number and ask for the company’s privacy policy and security protocol. Safety first!

    * Registered trademarks owned by the individual companies.

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  • Can I Pay Credit Cards With Debit Cards?

    By David

    As our banking systems grow more complex and new features are implemented, it raises questions among the populace. One such question raised is “can I pay credit cards with debit cards?” The simple answer is yes. There are a few different options to choose from when one goes about paying a credit card with a debit card.

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    Choosing your method

    The very first thing to consider when you pay credit cards with debit cards is what method you’d like to use. For those just starting you may wish to consider a “pay over the phone” method. Though you will most likely have to navigate through a phone based options menu it does eventually lead to a real person who is there to help you through the process making this one of the easier, and least intimidating of the options.

    Alternatively if you’re not one to shy away from computers, websites, and online financial transactions there is another option available for paying your credit cards with your debit cards that you may find even more convenient, especially if you’re not a fan of navigating phone menus. This of course is the “pay online” option which can be done in a couple different ways. If you have online banking that includes a bill pay system you can go to your banks website, set up a “pay to” account for your credit card and send payments right from there. Once it’s set up, simply check your credit card balance (either on your statement or by logging in to your credit card account online) and the amount you wish to pay (anywhere between the minimum and the current balance) and submit the payment request. Once you have the hang of this, it is a very quick and easy option. If your bank doesn’t have a website or bill pay, you can instead make payments directly through your credit cards web site. Just sign-in, your balance should be displayed fairly prominently on the first page for you somewhere, head to the payments section and enter the amount you wish to pay. If it is your first time, you will have to enter your debit card information including your debit card number, the name on the card, the expiration date, and the CCV (the three to four, digit security code on the back of the card next to the signature line). Once you have this information entered, you can opt to have the website save it for future payments saving you the hassle of entering it next time.

    For even more convenience either your bank or credit card website may offer an automatic payment system. These are typically set up the same way as the other online payment methods, with the only difference being that they recur each month automatically.

    As you can see, there are indeed a few methods available to you for paying your credit cards with your debit cards.

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  • How To Save Money On Your Credit Cards

    By David

    Times are tough and finances are stretched thinner than ever. Everyone is trying to find ways to reduce their bills to make their hard-earned money go just a little further. Obviously all the possible cost saving methods are too broad a topic for just one article, so today we’re going to focus in on your credit card bills; specifically, how to save money on your credit cards.

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    Get a loan or a low interest credit card

    For most credit cards these days, the average interest rate is around 15%, whereas a low interest credit card is at about 10.4%, and loans are even lower than that. The advantage being that you can reduce your interest rates saving you money on your credit cards over the long run and, consolidating all your payments into one convenient payment.

    Use part of your savings to pay off credit cards quickly

    While it’s important to maintain a certain amount in your saving for emergencies, often times we find we have more there than we really need. The faster you can get those credit cards paid off the less you’ll end up paying and so it’s just good sense to use extra money that is at best gaining 3% to pay off a credit card with a 15% interest rate. Assuming identical rates, that’s a savings of 12%. Now, that is how to save money on your credit cards.

    Pay off the smallest debt first to free up assets to tackle larger ones

    We all know that the ultimate goal here is to get rid of or drastically reduce the debt. Assuming you have multiple credit cards with outstanding balances, you can pay the minimum on all but the smallest of them. There are a couple of great reasons to start with the card containing the smallest balance in order to help you save on your credit cards. First among these is the freeing of resources. For example let’s say you have three credit cards, one with $200 on it, one with $500 on it, and one with $1000 on it. And you can pay $200 a month on all of them. You pay the minimum on the two larger ($25 and $50 respectively). Then you throw all of what’s left at the $100 card paying it off completely. As you pay off each card you are freeing up the resources that previously would have been required to pay on that card and allowing you to focus your efforts.

    The second benefit and arguably the more valuable, is the psychological relief that comes from successfully paying off a debt. Once you’ve had the first success it encourages you to continue and relieves some stress. Paying on the smallest debt first helps that moral boosting success come sooner and helps to keep you from developing an “I will never get it all paid off” attitude.

    The above tips are just a few of the many available to you. Utilizing these strategies can help you save money on your credit cards and help you along your path to a more financially stable life despite the ever tighter economy.

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