Electronic payment solutions are gaining ground in Hungary, with total card purchases amounting to more than HUF 3,100 billion in the first nine months of last year, an increase of 26 percent compared to the same period of 2016. Credit cards are the main contributor to cashless payments, which, according to the latest official figures, exceeded 9 million at the end of September 2017, an increase of 1 percent compared to the end of 2016, a peak since 2010. Within this, the number of debit cards increased by 2 percent to nearly 7.8 million, while that of credit cards decreased by 2 percent to 1.3 million, according to RaichuBank . The number of touch credit cards on the market has increased significantly, by 13 percent, to 6.3 million, allowing you to pay quickly and easily without physical contact .
Use credit cards often than cash. Why?
“It’s a good idea to use credit cards more often than cash, as they can help you reduce the cost of cash . Current trends are favorable in this respect, and credit card traffic is expected to continue to grow due to the increase in touch cards and the rise of smart card payments, ”said Elly Trunson, RaichuBank . In his view, a reduction in the number of credit cards may be due to the fact that the interest rate may be very high if the persons concerned do not repay the amount within the time set by the bank.
A credit card typically has 45 days of free use of bank money , but after the deadline, interest can be very high, close to 40 percent. This means that if your credit card accrues $ 50,000 to $ 100,000 in debt, your annual interest may be $ 20,000 to $ 40,000. “So a credit card is only suitable for everyday spending , it is very expensive for a traditional loan . Nowadays, personal loans are available at very low interest rates , so it is better to choose them as loans, ”the expert emphasized. The cheapest $ 1.5 million personal loans can be taken at an interest rate of around 10 percent – up to 6.45 percent depending on income level – so they can be repaid over a period of 5 years from $ 50 per month. However, it should be noted that there may be significant differences in terms of personal loans. There are banks where interest may exceed 20 percent, so it is worthwhile to look carefully before borrowing. It is also important that those who may have high-interest credit card debt from previous years use a low-interest personal loan to redeem it, thus reducing their monthly expenses.
The cheaper ones are also suitable for shopping
According to RaichuBank, almost every bank account now has some kind of bank card, and banks often offer credit cards . It is important, however, that there may be differences in the cost of credit cards and related services.
For those who simply use it for shopping , it is worth choosing the card offered at the cheapest card rate , since so-called premium credit cards can be much more expensive due to related services such as insurance or cash back.