With Christmas now less than a month away, you can bet that shoppers from all over Canada will be clamouring to get into the malls over the course of the next few weeks. There are many stores that will benefit from the increase in foot traffic. And then there will be those that will still be turning customers away. Now, what type of store owner would turn away business? According to our experiences, the kind that doesn’t accept credit cards and debit cards!
You see, when businesses stick to a cash-only way of doing things, they disregard the modern-day customer’s need to have payment options. Credit cards and debit cards are widely used in Canada. And you can bet that during the busy holiday shopping rush, the majority of shoppers will be pulling out the plastic to pay for their purchases. There are many reasons why plastic is preferred for holiday shopping.
Here are three:
1. Customers can redeem rewards points quicker. Many different types of credit cards have rewards programs that allow their cardholders to earn points that can be put towards merchandise or travel. With increased spending during the holidays comes a greater ability to collect points and redeem them quicker. Paying for holiday purchases with cash earns a customer nothing except the item that is purchased. The holiday shopping season is a great time to build up rewards points on credit cards.
“Many card rewards work on a point system where you earn up to five points per dollar spent,” explains Amy Fontinelle on Investopedia.com, “When you reach a certain point threshold, you can redeem your points for gift cards at some stores. You can also use the gift cards as gifts, making holiday and birthday shopping simpler and less expensive.”
2. It makes big ticket purchases easier to afford. We all know that this is the time of year when even the most frugal shoppers tend to spend more money than they normally would. Depending on how many people one has to buy for, it can mean spending money that isn’t readily available. With credit cards, shoppers have the option of extending their payments over time. This enables them to spend without worrying about having the money immediately.
“When you make a credit card purchase, your money remains in your checking account until a couple of weeks later when you pay your credit card bill,” explains Fontinelle, “Hanging on to your money for this extra time can be helpful in two ways. First, if you pay your credit card from a high-interest checking account and earn interest on your money during the grace period, the extra interest will eventually add up to a meaningful amount. Second, when you always pay with a credit card, you don\’t have to watch your bank account balance like crazy to make sure you stay in the black.”
3. Purchases are protected. Many holiday gifts take on the tag of being “big ticket” items. Flat screen TVs, video game systems, iPods and other electronic devices are especially hot sellers during the holiday shopping season. When people use their credit cards to make these purchases, they are often assured of having them covered in the event of loss, theft or damage. Cardholders are also covered in the event that their credit cards themselves are stolen.
Fontinelle points out that credit card companies protect cardholders form potential fraud. “Paying with a credit card makes it easier to avoid losses from fraud,” she describes, “when your credit card is used fraudulently, you aren\’t out any money – you just notify your credit card company of the fraud and don\’t pay for the transactions you didn\’t make while the credit card company resolves the matter.”