Answering the question posed by the title of today’s blog isn’t possible in one sentence. There are many reasons Canadians love using their credit cards so much. Speaking from the customer perspective, we love the idea of being able to get extra time to pay off balances. Even if you don’t choose to extend payment on a monthly balance, paying for a purchase with a credit card automatically gives you additional time to actually fork that money out of your bank account.
As the Canadian Bankers Association explains it, credit cards provide consumers with access to unsecured credit (which involves no collateral required against amounts charged). That means that when a PIN code is punched into a POS terminal to complete a transaction, the customer has up until the due date of his/her forthcoming credit card bill to make a payment for that very charge.
It’s like getting a free loan! “Credit cards provide interest-free credit from the time of purchase to the end of the billing period, the CBA reiterates. They go on to note that the majority of Canadian credit card users don’t even incur any interest charges for taking advantage of this short loan period. And that’s because 60 percent of Canadians pay their credit card balances off in full each month. Therefore, the interest rate is zero.
What other benefits to credit cardholders receive? Canadian consumers who pay with credit cards get a wide variety of insurances for the purchases they make. In many cases, credit card issuers will offer extended warranties and purchase protection plans that cover items in the event that they are lost, stolen or damaged. The CBA notes that many credit cards provide “coverage for purchases if the item is damaged, stolen or not delivered within 90 days.”
Rewards points are also among the great benefits given to credit cardholders. Travel rewards are among the most popular perks that come along with most credit cards. Many Canadian credit cardholders have enjoyed free airline tickets, car rentals and hotel stays thanks to the fact that they use their credit cards to pay for all of their purchases – whether they happen to be travel-related or not.
How valuable is fraud protection for Canadian cardholders? “Fraud protection with zero liability to the consumer in cases of fraud” is listed as another credit card benefit for consumers, by the Canadian Bankers Association. And its importance cannot be overstated. If a cardholder loses his/her card and reports it missing, no charges placed on the card in a fraudulent manner will be the responsibility of its rightful owner. Needless to say, fraud protection is incredibly valuable.
When cash is lost, it is lost for good. When credit cards go missing, credit card issuers protect their customers by cancelling the cards and issuing new ones. According to the CBA, the bottom line is that “credit cards offer valuable benefits for both consumers and retailers. And the majority of Canadians use their credit card as a method of payment rather than a means of borrowing.”
At Canadian POS Corporation, we offer Canadian business owners the opportunity to accept both credit cards and debit cards as methods of payment at the most affordable rates in our industry! For more information about either our Countertop or Wireless terminals, don’t hesitate to call Canadian POS Corporation at 1-877-748-2884 or email us at info@localhost.