Bitcoin Forum

As some may have observed, highly developed countries like the US encourages their people to use credit cards for transactions. Cash transactions are still used but mostly they prefer people to have their credit cards. I want to know if having a credit card really necessary even if they can afford to pay in cash? Are credit cards reflective of your ability to pay?

I guess it does indicate where a country is in terms of technological adoption, as credit cards being popular. With more cash dominated places, you generally tend to see adoption of new technologies to a lesser degree.

But the decision to go cashless isn't really on the consumer, and there are obviously countries where economic development isn't really that high, but they are still forced into using credit cards or other cashless payment methods due to their fiat currency being dysfunctional.

It is not reflective of your ability to pay. IMHO, it could be reflective of debt since credit card is essentially loans on demand. If you look at most western countries, you'll see that the levels of credit card debt is just crazy right now. Anyhow, credit cards are really not something that's new and I think if you want an indicator of a nation's economy economy, still look at all the traditional indicators like GDP etc. depending on your needs. If you want to look at how receptive they are to new Fintech, look at their policy with crypto.

Your statement will make sense if you replace the word "credit card" with "plastic card", at least me! Developed countries encourage their citizens to use plastic card more often than cash. Sweden is the first country in the world who had achieved such milestone. It is an effective measure to curb black money to be mixed within the economy.

On the other hand, credit card is a banking trap. In some third world countries, credit card companies take interest as high as 48% per annum. Credit card doesn't signify the development of a country, it signifies the control of banking cartel over the country's economy.

Yeah it could be a good indication how successful a nation are if people are encourage to used more of their credit card rather than bringing huge money with them. Actually, I was quite surprised when I traveled to US before and people are using their credit card and their bank cheques to pay even a small amount of money. Well in my place where I lived in, there's a lot of people also using their credit cards but I'm assuming they just used it to buy 'expensive' items. And most of the time if credit cards are used here, it raises some eyebrows specially to those behind you because it takes more time to processed it, so the lines piled up.  ;D

I think that is wrong perception, of course government will encourages their people to use credit cards because their bank will get more profit. I don't think that credit card is a good thing because it still costly to make transactions using it. I prefer to use bitcoin because it's more practical to use.

It doesn't have any indication at all.

Some countries are so poor that they show indications of credit card use because people can't afford simple stuff and that makes the card debts going a lot higher than it suppose to and many even default on their debt which leads to a whole lot of paper work for the bank, makes it harder to give out loans and than cripples the future profits to be made easily.

After all in some first world countries, where economy is great (not that there are many left in the world like that) rich people use credit cards and have very few cash because they already have a lot of money in the bank and the banks allow them to use limitless credit cards, type that could buy a plane with if you want and that shows credit cards are good for business there.

Hence, use of credit cards is not an indicator, credit card debt repayment is the key here, if the credit card debts are all paid than its a strong indicator that people are fine, if the credit cards are defaulted more than average then it shows they are poor.

Credits cards are the worst type of consumer debt.Any individual with some sort of financial culture will avoide using credtis cards and getting into high interest rate debt.Unfortunately there are many stereotype that "successful" people own and use credit cards and if you wanna be "successful", you will have to get one too.
This is just pure marketing.

I really fail to see how it could be an indication of a country's economic situation.

Use of credit cards could have a lot to do with the nation's culture in my opinion.

In some countries parents teach their children from an early ago that it's bad to pay for things with credit.
It definitely was the case at my home where I grew up, I've heard the same stories from friends and relatives.

Plus, we generally have a very easy to use banking system with debit cards, directly tied to our main bank account.
We can use it to pay for almost anything, I even think it's accepted more than credit cards.

I'm not talking about something like a Mastercard debit card, but rather a bank card issued by banks like ING, Deutsche Bank, etc.

In today's life, most people use credit cards. It is very convenient in life. This also contributes to the economic performance of a country. The richer the credit card, the higher the credit card used. Instead of storing a large amount of unsecured home, send it on a credit card.

Using credit cards in a country in indication that people are educated; aware about technology and want to use card payments instead of cash payments.
But we can not say that credit card is strong indicator of nation's economy.  If people are using debit cards it will mean that people are wealthy too and spending their own money instead of borrowed money through credit cards.

Money spent through Credit card if not paid in time will seriously affect the user economically and his goodwill will also get affected.  The user may be levied heavy penalty and interest and may be deprived to use the facility in future.  But in case of debit card usage the user is the king; no need to repay; just spending own money.

Use of cashless payment methods isn't really an indicator of a strong economy but rather educated citizens willing to go cashless for convenience and security. Oftentimes, it's just the pace of the society that makes people use credit/debit cards in every opportunity that they could, but it doesn't affect the overall economy since the proceeds of the interest would, in the end, still get to the credit card companies and not to the government per se.

I have never considered the need to use credit cards, as this is the most unprofitable use of money. Banks try to put you on credit cards only for the sake of maximum profit. They are interested in it and why in any way would be to give it to you.
If money is needed it is better to take a consumer loan or borrow from a friend, so you are more free in your world. Using loans you wallow in public debt, and the State is profitable.

The big difference in here is the how easy it is to get a credit card in different countries and I think that will stand the economic status of a certain country. For instance in most first world countries like the US it is much easier to get a credit card as long as you have a good credit standing compared to third world countries where getting one has many requirements.

Although the reason behind bitcoin creation was to create a currency will make every man equal, make people financial free and save us all from the economic problem which was created by the government. But, with the statement made by the OP I think US government seems to now understand the bright side of cryptocurrency.
Meanwhile, cash was created for ease payment because gold are not easy to mobilzed and it cant be pay in cent. For the government to now advice the uses of credit/debit card it mean what the IMF boss (https://www.ccn.com/imf-chief-lagarde-central-banks-should-consider-issuing-digital-currency/?fbclid=IwAR16_9e4i2wGIx-FSUllp4Ww1n15Mmxn2RoNtRlYTWcpkxxKN-y7gbBjP6c) said seems to be happening and every soon many countries will have their own cryptocurrency.

Using credit card means that their country citizen is not making enough revenue to cover up their daily life expenses so it is not an indicator of strong economy.

If you meant to say about the usage of digital payment then it also not since the developing countries like India also implemented debit and credit card payments everywhere but still it is one of the poor countries in the world.

Credit cards helps the economy to wade off certain challenges like theft of physical cash being stashed away and attacks. It also gets financial transactions to be easily done, saving the individual time which could be channelled towards other resourceful ventures that will certainly contribute to the country's gdp.

Other types of plastic cards that are not necessarily credit cards, help tackle the challenges you listed without charging exorbitant interests rates to the detriment of the user. A countries ability to offer massive credit to its citizen indicates a healthy economy, however, I wouldn't subscribe to them because of the interest. It is better to get a debit card that charges only standard fees, and you can preserve your credit score for when and if you really need a loan/credit.

There isn't a good method of charging interest on lump sum cash payments. Credit cards introduce APR's (annual percentage rates) as a means of charging interest on top of existing transactions with late payments. Thus credit cards are more greatly incentivized due to them offering greater profit potential over the mechanics of straight cash payments.

Outstanding credit card debt per population is considered a negative economic/financial statistic when it is high. It generally means credit is tapped out for consumers.

Having a credit card isn't a good indication of a person's ability to pay. That is generally measured by a person's credit rating which is generated from a history of the electronic payments a person makes. To get a high credit rating a person must always make payments on schedule. No late payments. This in turn allows a person to qualify for better loan standards & other benefits.

in my opinion the use of credit cards shows a person's ability to pay for something and can also facilitate transactions. with various credit card advantages such as being able to deduct and also facilitate transactions, credit cards are a good thing to have.

Credit cards are not an indicator of an economic development. It is just an instrument for transaction. Someone can have more money and never pay with the credit card.

I don't think so. The number of credit cards usage is not an indicator of good economy. Credit cards are simply substitute to cash transactions with additional fees, of course. A good indicator of good economy is the people's standard of living. A good economy should be able to reflect its effect on how people in that country live.

Well, I think you're trying to say is the automated card usage a good indicator of economy regardless if it is credit cards, debit cards, etc. A country with huge number of automated card usage can easily adopt bitcoin usage.

I never thought of it that way. If anything, it shows how much a nation is hungry for cheap and on demand credit.

It's simply not logical to think that economic development can be reflected through the use of a single financial instrument, that is pretty much available anywhere in the world. It's not even something that requires advanced information technology in order to implement.

High levels of credit card debt only show that a country is spending beyond their means and the credit card company is doing a good job of implementing and promoting their product, and probably making bank. But imo, there is nothing more than that to it.

Really? As far as I know, credit cards are our liability. If we does not have money to buy things, we use our credit cards and pay our debt later on. This is not an indicator of a strong economy. As a unit, it does not help us to grow because as we know, liability never been an asset. We will stock up and struggle once we have debt.

Mostly, credit card transaction to measure consumption rate in the country. Its more easier for authorities to track transaction thru credit card because using digital transaction. Using paper money for transaction is harder to track and to calculate consumption rate.
I think more credit card circulate in public doesnt mean the ability to pay because bad debt number in credit card transaction are high too

This is wrong. Once the use of credit cards exceeds market expectations, the risk of the market will become even greater. Once the economy fluctuates, many users of the card will default, so bank funds will enter a nausea cycle. Usually this is a financial crisis. The best economy from the perspective of people's savings rate. The more money people save, the faster the money flows, and the more active the market.

Credit cards are responsible for people in debts today and the capitalists have found a way for force their ways into the way of life of people that you are forced to use it even though you don't need it. I have seen people forced to use it because they want to increase their credit rating in other to be eligible for things that they actually need.

On the effect on the economy, other than affording people the opportunity to have access to what they wouldn't have which ensures they live with basic comfort, the disadvantages also abound and if I am to choose in waiting to have cash or use credit, I will go for the former.

Its not necessary to have a credit but its our choice to have it for the reasons of convenience and safety as money can be easily to be stolen in the streets but not the credit card. Although having a credit card will provide +1 for your trust reputation but that if you want to live in debt in which many famous rich personalities that chose to not have a credit card like Bill Gates and Warren Buffett.

Credit card use is a good indicator of a nations debt problem and also a excellent tool for the government to monitor people's spending habits. <every transaction is recorded and stored on a centralized database>

Governments cannot stimulate economies with fiat transactions, because Fiat transactions are expensive and slow, they need debt <credit cards> to stimulate their economy. This is why more and more governments are supporting a cashless financial system.  ::)

Debt will kill nations economies in the future.  :P

Basic truth! Certainly those who have access to credit cards in developed countries today, even when they could not afford something, tend to just have it in their mindset that credit card will be their solution and they keep piling up debt over debt until they realize their life is already totally dependent on a huge stack of debt and trying to find a way to relieve themselves off it which to me is more like being a slave to the bank for a long time.

Simply, give people the chance to take something free in the short term and they will simply take more than you ask them. It is human nature when it comes to showing off, living a life you cannot handle in reality if you have no access to credit card, and all that puts your life into a huge pressure normally, which to me is not a strong indicator to economy but a jeopardy to human themselves.

Credit cards are similar to the nature of microfinance loans. The future income is used for current consumption, but there is an interest-free period, which can greatly meet the needs of consumers and the rapid development of the national economy.
The country's economic indicators need GDP to react! Credit cards can't respond to the economy!

Credit cant be the measurement of a country economic, moat of the people consider credit card as debt, so the more people using it then the more debt it accumulated, but i think that ia not the way to see nation economic, you can see the nation economic with how big is the unemployment rate and how many homeless people, using credit card or using fiat doesn't reflect the country's economic but its more on the habit and the easiness for people to do transaction

At least it means that some technogies are integrated in country and people don't look surprised when you ask them if you can pay by card. On another hand it means nothing dramatic, some prefer cash and some prefer their cards, depends on person too, people who have online banking and usually make transactions, prefer this way. Old people and others who get paid cash, usually self-employed, prefer to use cash and don't load cards or own it. Btw I would say, if there are many users with visa gold cards, then yeah, it means good economy :D

The more usage of credit card means how poor the ciitizen are,they can't even cover their monthly expenses with what they are earning they are looking for cssh from someone is not the good economy.

The use of a credit card and the abandonment of cash only indicate the level of brainwashing by the government: with the credit card, not only is all your expenses recorded and tracked, but also your position. Good luck!

It's more about cultural attitudes than technology.

Japan is an advanced economy in anyone's book yet it's still overwhelmingly cash based.

Credit cards have piddling penetration in Germany. There aren't a great deal in France and French banks are extremely reluctant to allow their customers to get into debt. In the UK the banks are delighted to let everyone hang themselves so everyone has them maxed to the hilt.

Credit card companies do many things to encourage use of their cards (miles, points, ect).
I personally prefer to use a card to pay for most things, it is an excellent way to see how you really spend money.

What is reflective of our ability to pay is how much debt we are in, and yes that can be a strong indicator of a nation's economy.

Thankfully I live in a country where the bank has an amazing app and since one bank does all banks rival for the best app there is on the market in order to be not left behind. Thanks to these amazing apps it shows how much you spend and if you want to pay right away or would you prefer 3/6/9 months installments and all that.

Our banking system is really far ahead of many in the world for customers instead of just banks and that is great.

However, just because of these doesn't mean the economy is any good, in fact we are much better in this system exactly because our economy sucks, since our economy sucks banks can't really make too much money and they need to get as much market share as they can otherwise they are not really making too much money from this bad economy to begin with.

But if it happens to you to get robbed, robbers can`t do much with your credit card, they need password. so credit card can protect your asset in some way. Capitalism is all about spending money, possibility for more money to be spend make one economy better than other, will you spend that money in form of cash, credit card or anything else isn`t so important.
And if someone wants to track you done he can do that in million ways now, you have a cell phone with gps in it, so what to talk more about tracking down, we are all online, we are not even hiding from anyone.

What you exactly mean ? Government encourages credit card based transaction or just electronic mode of transaction ? Because, I doubt that you are not having clear understanding between these two types of  mode of transactions. As far as I have observed that no government will emphasize their citizen to go for loans but now a days, many governments are slowing enforcing citizens to go for electronic mode of transaction due to the reason of "easy tracking".

Cashless society is the stage on which governments are believing to have all the control of money-flow. But, I believe no government will be successful on their actual target as privacy is the basic human right and no government may not interfere into that.

Using a credit card cannot be an indicator as it is just another type of loan. A nation's economy has nothing to do with it.

More peoples transaction using credit card can be indicated the consumption in the country is stronger. But i dont think thats a strong indicator of nation's economic because its public debt. I think stronger compsumtion indicate a good economic growth

Government like in US want theirs people using credit card because they can track our transaction more easier. Beside about taxes, its about digitalizing our money and i think its good for national economic.

Looking at the positive side of it, though, it is actually a more secure way of transacting. It prevents you from keeping or holding so much cash on hand or at home. It is a matter of convenience.

If anyone wants our country to be more economically stronger than the power is not in our hands it is all about the government and banks but we can more contribute for the development of the society that is the only thing you can do.

I think it will be a little illustrative because credit card platform itself will certainly not issue a credit card for the poor. and of course the poor will not use it. in developed countries like United States there are many people who use credit cards. I think that already explains

Credit cards are really not necessary to be used. It just make or give convenience to its users where they already do not need to bring physical money in order to buy goods and services in malls, restaurants and others. Credit cards do not also indicate that the nation's economy is strong. Nations economy can be determined by the number of people who have a large amount of money, assets and investment in certain location.

A poor, if he has an income stream then he is eligible for a credit card as per my country's banking norms. I am not from a developed country and our economy is not a stronger one as far as I am aware of. In my opinion, most probably OP is misinterpreting the government's stand on electronic payments with credit card payments. Availability of credit card to common people cannot be an indicator for a nation's economy growth as it has nothing to do with the development of a nation.

Any country may print as much as money they prefer to have and then they may loan it  to each and everyone who opt for loan for the reason of getting back it with interest. Will that indicate their gold reserve levels ?

I think that promoting credit cards can help many companies, such as loans, but I don't think that using credit cards is a powerful indicator of a country's economy.

personally, i believe that if a country's economy is strong it means that people are earning sufficiently and does not need credit to survive.

The only indication of strong economy is all their country people have enough needs to live their life like jobs,foods and living places this can describe about economy but digital cash are just common everywhere even African countries have digital payments everywhere so it is not going to be considered for strong nation.

on the other hand I think that with a small crime rate it can be an indicator that the country is strong in terms of its economy. because many perpetrators of crime occur because of economic difficulties

For US countries it seems safe to use a credit card to be able to see the condition of economic indicators and can be used to buy something you want, but in some other countries this credit card has a problem that makes some people afraid to use credit cards even though they offer to attract many people to use credit cards.

Indicator of one strong economy is a product or raw material, not money, in any form. When you have good product you can sell it for money, gold, bitcoins, with raw material is the same you can sell it or create something from it, but with money like you say people cant do much. Credit cards are small plastic cards issued by a third party service, allowing the holder to purchase goods or services on credit, in that way it makes us to live in debt, do we need to say anything else about the credit cards and about third party services?

Crime looks different from country to country, and the amounts concerned with crimes as well. I am sure that the crimes on corporate levels tell a whole different story if we were granted a look into the actual numbers.

Nothing in the world comes even remotely close to the fraudulent activities happening within the corporate world, but since the mainstream media is so focused on small scale criminality, it overshadows everything unfortunately.

By your logic, it would mean that the wealthiest countries would come out worse than countries with a weaker economy. There are always two sides to a story, because what you see and read about isn't always what is right.

Indeed, in my place they don’t encourage everyone to use credit card because its too risky most especially if you can’t afford to spend the money you don’t have. Most of us here also not qualified for that but it doesn’t mean that it can affect much our economy, it only means that we are earning low and we should only live within our means.

Yes as when people get no good to the family they demand for and then when there will be no source to earn so surely people commit to get in crime. But after the digital warming system and intentional of bitcoin the rate of crime activities has reduced as now there are so many source to earn better and spend easily.

But it looks like having excess money to loan its citizens is also another way of measuring how strong one country's economy is. If we notice only developed countries are loaning to underdeveloped and developing countries. In this way, I assume OP is right with his perceptions even I am too disagreeing at first look with this discussion. A country will be having capability to issue loan only if it is having saturated resources.

But, no country will be able to simply printing money without proper reserves because it will lead to bankrupted at one day are other, they cannot hide for long term. If they are issuing credit cards, in some sense they are having enough resources to cover everything. In that case, it must be an indicator of a nation's economy.

The advanced world is adopting cashless society and that is the messages of digitalization because no body like to go with cash any longer. Cashless society is the secondary form of financial transactions because with it comes all other digital currency and blockchain technology introduced cryptocurrency and as the digital bank.

@Supercrypt
Governments don't print money, central banks do. And sorry but they do print money without anything backing up, it's called the fractional reserve. It's not like when gold was backing USD

@cizatext
Some countries don't like and refuse a digital form of money. I know in Germany only 10-15% of the transactions are done with a card

High usage of credit cards simply means an economy is highly indebted.

If anything goes wrong the US cannot honor its debt. The only way everyone is rolling their debt forward is because the FED keeps printing money.

Soon as China or US economy stops growing exponentially the system will crash.

Present day system requires exponential growth to stay afloat. Debt is 10x larger than the US economy, it's impossible to pay unless growth is composed year over year.

Yes transactions in form of credit cards can be differ from the "cashless" society that's on your mind. I can't explain it well but taking example of debit cards and cryptocurrencies.

You're not in debt when you use these unlike what OP asks for the use of credit cards as an indicator of the status of an economy.

during the use of debit cards for productive activities, I think this can improve one's economy. although not in debt, but using it must be wise, so that our good name in the bank is maintained. thus a symbiosis of mutualism will be established between us and can bring our thoughts to be ready to face the modern world by using it

Good credit standing would matter to the bank.

They don't care on how much you spend, as long as you maintain your balance or pay your debt that's what matters to them. As for the improvement of the economy, its not enough to think that it can contribute big for it.

No. I think all of the country has credit cards. This is an option not totally a compulsory to have a credit card. As we all.know that credit card is handy and has advantage than bringing fiat money to which it could make your wallet or pockey bulky if you will be bringing a lot of money. This is why it is a good practice to use credit cards in making a transaction but still it has disadvantage when an establishement does not support or accept credit card so have tp bring fiat money for it.