The usage of the internet is increasing rapidly in all countries of the world. This has resulted in the growth of e-shopping or virtual shopping. The benefits of credit card payment online can be seen in a lot of ways. You can easily browse any online store and make payments for the goods that you want. Once your payment is accepted, the goods that you paid for will be sent to you within a short period of time.

Although there are still people who prefer to manually send a check for their payments, they are fast becoming the minority. Most people will rather take advantage of the benefits of credit card payment online. These days, a lot of people work long hours and they do not have the luxury of spending extended periods on shopping. Making payments online is definitely more convenient and it also saves you a lot of time.

This article will talk more about the benefits you will enjoy if you make your online payments using your credit card. Let’s get into it.

• Why Should you Use Your Credit Card Online?
• What is One Advantage of Using a Credit Card to Pay for Online Purchases?
• What are the Advantages of Accepting Credit Card Payments?
• Is it Better to Pay With a Credit Card or Debit Card Online?
• Is it Safe to Pay With Credit Card Online?
• What is the Best Way to Use a Credit Card?
• Which is Safer to Use Online Debit or Credit?
• What is Credit Card and its Benefits?
• How can I Lower my Credit Card Interest Rate?
• How can a Customer be Benefited Through Using Credit Card?
• Why is a Credit Card the Safest Form of Payment?

Why Should you Use Your Credit Card Online?

Personal finance experts spend a lot of energy trying to prevent us from using credit cards—and with good reason. Many of us use credit cards irresponsibly and end up in debt. However, contrary to popular belief, if you can use the plastic responsibly, you’re actually much better off paying with a credit card than with a debit card and keeping cash transactions to a minimum.

Let’s examine good reasons why you should use your credit card online.

1. You can earn rewards on your spending

With the rare exception, you get nothing back when you make a purchase with your debit card. You spend the money, it gets deducted from your account, and that’s that.

It’s a different story with credit cards, as rewards have become a common perk. Among the best credit cards, you’ll find both cards that offer cash back and cards that earn points you can use to purchase travel.

Read Also: Save Money With New Car Loan Rates Comparison

In some cases, you may even be able to earn bonus cash back or points with your online shopping. Some cards can earn more back at certain online retailers, and many card issuers also have online shopping portals you can go through to earn more points. For example, you may be able to earn 3 points per $1 instead of 1 point per $1 shopping at a specific store, but only if you go to the retailer’s site through your card issuer’s shopping portal.

2. You’re at less risk if your card number is stolen

Online transactions are generally secure, especially when you’re shopping with major retailers, but people do occasionally get their card numbers stolen. If your number does get stolen, a stolen credit card number is much less of a hassle than a stolen debit card number.

Once somebody has your debit card information, they essentially have access to the money in your account. They can spend your money and drain your account, at least until you or your bank notice the fraudulent transactions. You should be able to get any stolen money reimbursed, but that can take weeks.

Although a thief can also make purchases with your credit card information, they won’t be able to touch the money in your bank account.

3. You’ll have an easier time if you need to dispute a transaction

Sometimes you make a purchase from an online retailer and it doesn’t deliver — either literally, like when you never get what you ordered, or figuratively, like when your order doesn’t live up to the description of what you purchased.

Step one is to take it up with the merchant, but if that doesn’t work, then you’ll need to dispute the transaction. And just like a fraud is easier to deal with on a credit card than a debit card, so are disputed transactions.

For one thing, the transaction will only be on your credit card, and the money won’t be out of your bank account. Credit card issuers are also typically proactive about fighting for their cardholders to provide a quality experience and build brand loyalty.

4. Your credit card may offer protections for your purchase

Let’s say you buy a computer online, and then see it for 40% off two weeks later. Or, your brand-new computer gets stolen a month after you bought it.

If you made that purchase with a credit card, then you may have some recourse in those scenarios. Many Mastercard and Visa cards offer protections for just these types of situations. And all American Express cards do, too.

These protections can include:

• Price protection: Covers you if a product is available for a lower price than you paid.
• Purchase protection: Covers your purchases against damage or theft.
• Extended warranty coverage: Automatically extends the manufacturer’s warranty on a product.

All these protections have their limits, but they’re nice to have in case you need them.

It’s not that debit cards are a bad way to shop online; they simply don’t have the benefits or protections that credit cards have. You’ll be more secure using a credit card, you could get some protection on your purchase, and you can earn cash or points back on your spending through credit card rewards.

What is One Advantage of Using a Credit Card to Pay for Online Purchases?

Credit cards have become a major source of payment for customers when buying online as they provide multiple advantages.

1. Offers for online purchase

Many credit card issuers have started providing benefits like cashback or discounts from consumer durables/ electronic or fashion e-commerce websites as an added incentive to buy products online. These types of benefits or features are not available on most of the debit cards.

2. Easy EMI

Consumer durable loan is something that has been around for a long time now, but it was something that online retailers did not provide. But now a customer can get easy EMI based on their credit card. A person can take a loan for any product on their credit cards at nominal interest rates which they can repay in EMIs.

3. Liability for fraudulent charges

There are many reports of hacking where a hacker steals the personal information of a person or the card details to rack up charges on credit cards or debit cards owned by the victim.

With credit cards banks provide theft protection,  a feature that is not available on debit cards; where post paying a very nominal fee the debt will be cleared from the victim’s card or if possible all the charges reversed thereby getting back the money stolen.

• Consumer protection

How many times has this happened to you – you bought a product online, it was defective, and the vendor is making you run around in circles when you ask for a refund?

When you pay with a debit card you do not have any leverage as the money is directly withdrawn from your account while in the case of a credit card banks and card issuers give the option of payment reversal where you can ask the card issuer to reverse the funds citing an issue with the product. This way the consumer is always protected.

4. Credit score improvement

Another very important point a person needs to remember is that it is only with credit cards that your credit score can improve. Since credit cards are a source of loans either secured or unsecured is a way a person can improve their credit score. This is an added benefit for the cardholder.

What are the Advantages of Accepting Credit Card Payments?

Considering that credit cards are increasingly becoming the chief mode of payment, you may be on the losing end if you are running a business that does not accept credit card transactions.

Cash only accounts for 20% of all transactions and the average person only keeps $67 on them at any given time. When asked, 32% of respondents to a Federal Reserve Bank of San Francisco survey said they prefer to use a credit card as their primary form of payment.

You may be considering accepting credit cards as a form of payment for your business. No matter the type of business you are involved in, accepting credit cards can increase sales and generally produce positive results for the business.

Below are some benefits of accepting credit cards as a payment option:

Legitimacy

Allowing credit card transactions will help establish your status in the industry. By providing clients with more options, they will be more pleased and satisfied with your business, making you satisfied as well. This will help your business grow more quickly, attaining a stronger placement in the market.

It will also contribute to a positive image of the business as well as your clients. Accepting credit cards will also give your business a level of legitimacy and can help instill rapport and trust with your customers.

Easy Sales

Customers do not like wasting time when making purchases. When shopping, they want their transactions completed immediately. Having a credit card facility will help you achieve this. Customers who are allowed to use credit cards may be more engaged in shopping and will tend to look positively at your business. With more convenient payment options, more customers will be attracted to the efficient and reliable services of your business.

Time Savings

If you have an online business, accepting credit card payments will save you a lot of time. Payments through credit cards can quickly be authorized, unlike money orders and checks, which take days and weeks to clear. Accepting credit card payments can thus have a tremendously positive effect on your cash flow.

Even if your sales are not increasing, your business will still benefit from the convenience of having your profit from the credit card sale delivered to your bank account instantly.

Higher Sales

If you do not accept credit cards, you run the risk of losing hundreds of potential customers who are not willing to pay in cash or who do not have other means to make their payments. There are people who only use credit cards to make particular types of purchases, especially online.

People do not want to carry large amounts of cash when they shop or they like to use credit cards for the security of a credit card no-fraud guarantee and rewards points. So if customers are provided with advanced payment options, they are more likely to make more purchases, which will lead to increased product sales.

Is it Better to Pay With a Credit Card or Debit Card Online?

Most people have at least one debit card and one credit card and have used both multiple times. While each is handy and easy to use, they influence your finances in different ways. 

Credit cards are issued by a bank and allow users to borrow up to a certain amount of money, known as a credit limit. Whatever you borrow during a specific billing period, you must pay back — typically with interest.  

Multiple types of credit cards exist, including a traditional card; a rewards card, which allows you to earn cash-back, air miles, or discounts (for example, with each purchase you make); or a secured card, which requires an up-front deposit before use. 

Major credit institutions also issue debit cards, but no borrowing is involved. Whatever money you spend comes directly from your checking or savings account. 

You can acquire a few different debit cards, the most popular being a standard debit card and prepaid cards, which you can prefill with a certain amount of money and then use to spend up to that amount. 

Most experts suggest using credit cards for your online purchases, especially if you’re choosing between credit and debit. While the risk of fraud is always lurking in the background, credit cards come with additional protections that debit cards simply lack. Here’s what we mean:

1. Most cards come with zero-fraud liability

While certain protections are extended to both debit and credit card transactions from the federal government, most credit cards take these protections a step further by offering their own form of zero-fraud liability.

If someone does get your credit card number and makes a purchase online, chances are good you won’t be held liable for a single cent of it if you report it in a timely manner. Sadly, the same can’t be said about purchases made with debit cards at all — more on that in a minute.

2. Federal protections are greater for purchases made on credit

Thanks to the passage of the Fair Credit Billing Act, liability for unauthorized charges made with credit is limited to $50 for both in-person and online credit transactions as long as you report the incident within 60 days.

However, as noted above, most credit cards offer zero fraud liability, meaning you won’t be on the hook for a penny. Most credit card issuers will put the fraudulent charge on hold while they conduct an investigation so that you won’t be out the money in the interim, either.

Debit cards, though, are a different story. Since the money you spend comes out of your bank account, you may have to wait days or weeks to get a refund for a fraudulent transaction made with your card. Further, your liability jumps to $500 if you don’t catch the fraudulent transaction within two business days – and you could even have your bank account drained with no recourse after that.

Here’s how the Federal Trade Commission words it: If a fraudulent transaction made with debit goes unreported for more than 60 days after your statement is sent, you could be on the hook for “all the money taken from your ATM/debit card account, and possibly more; for example, money in accounts linked to your debit account.”

Use a credit card for online purchases: It will offer more consumer protection than a debit card does in the event of fraud.

3. Credit cards make it easier to dispute charges

Another reason credit is better than debit for online purchases: is dispute resolution. What happens if you order something online and it shows up damaged or doesn’t show up at all? Or what if you don’t get what you ordered?

“When you pay with your credit card, you may have the ability to withhold payment or dispute a charge if there is an issue with your purchase,” notes Discover on their blog. Most of the time, your card issuer will even take care of the investigation details, too. If you receive something funny or damaged in the mail, you just need to pick up the phone and call them.

However, the situation may not be resolved so smoothly if you made the purchase with a debit card instead. “When you pay with your debit card, the funds are immediately withdrawn from your account, leaving you without the cash until you can settle the dispute with the merchant on your own,” says Discover. And, even if your bank takes up your cause, you’ll have the burden of proof on your shoulders.

4. Using credit cards responsibly can help you build credit over time

Where debit cards link directly to your bank account and let you use your own money, credit cards offer a short-term loan you have to pay back. While this may sound scary, this situation could actually be a boon to your credit health and credit score. By making purchases with your card and paying your bill right away, you’ll exhibit responsible credit habits that can boost your score over time.

Remember, debit cards don’t help you build credit, nor do they report your account activity to the three major credit bureaus — Experian, Equifax, and TransUnion. If you actually want to improve your credit, using the credit you already have responsibly might be the best way.

Is it Safe to Pay With Credit Card Online?

Cybercrime is definitely on the rise, and many of the most troubling criminal acts center around in-person and online payment methods as well as general identity theft. According to the Insurance Information Institute (III), the most common identity theft complaints in 2020 (32 percent) were related to scams involving government benefits, including federal stimulus payments. Coming in a close second was new credit card account fraud, making up 30 percent of all identity theft complaints last year.

In total, the III reports that there were 4.8 million identity theft and fraud reports received by the Federal Trade Commission (FTC) in 2020, which is up a staggering 45 percent from 2019.

With all this in mind, you may be wondering about the safest ways to pay for purchases when you’re shopping in a store or browsing the web. The good news is, that there are plenty of in-person and online payment methods that have the technology and features to keep your personal information safe.

If you’re hoping to make your transactions as secure as possible when you shop online, consider the following online payment methods.

Credit cards

By and large, credit cards are easily the most secure and safe payment method to use when you shop online. Credit cards use online security features like encryption and fraud monitoring to keep your accounts and personal information safe. Most issuers also offer zero fraud liability that ensures you won’t be on the hook for a cent in fraudulent transactions charged to your credit card.

Beyond the zero fraud liability coverage credit cards offer, you can only be legally liable for up to $50 in fraudulent charges on a credit card due to language in the Fair Credit Billing Act (FCBA).

ACH payments

Automated Clearing House (ACH) payments let you transfer funds directly from your checking account to another bank account. This payment network adheres to plenty of security features that keep your banking information safe, such as encryption and the implementation of access controls.

Voice payments

According to the 2020 How We Will Pay Study by PYMNTS and Visa, 23 million consumers who own a voice device, like an Amazon Echo or Google Nest, use their device to make purchases while going about their daily routines. If you want your voice payments to be more secure, you should set up a credit card with zero fraud liability as your preferred payment method.

What is the Best Way to Use a Credit Card?

Whether you’re new to using credit cards or looking to improve your existing credit, credit cards are the most common tool people use to build and rebuild their credit. Below you’ll find some tips on how to use credit tactically to help stay out of debt. Be sure to follow these best practices to keep your finances and credit as healthy as you can.

Keep Your Balances Low

Keeping a low balance on your credit cards could make it easier to pay balances in full and reduce the amount of interest you have to pay each month.

Use Less than 30% of your Credit Limit

Credit utilization, also called credit usage, is the ratio of your credit card balance to your credit limit. It’s a key factor in how FICO determines your credit score. Using less than 30% of your card’s credit limit is essential for maintaining a good credit score.

Pay Your Bills on Time

Payment history is another important factor in how your FICO credit score is determined. Paying bills on time ensures that you continue to build a positive payment history. Plus, paying your credit card bills on time guarantees that you won’t incur any late fees.

Pay More than the Minimum Due

The lower the balance that remains on your card each month, the less interest you’ll have to pay on the money you borrow. The best way to avoid costly interest payments is by paying your balance in full each month.

If paying your balance in full simply isn’t an option, the next best thing you can do is pay as much toward your balance as possible.  Just know that the more money you put towards an outstanding balance, the less interest you’ll have to pay in the long term.

Monitor Your Credit Card for Fraudulent Charges

Fraudulent charges can quickly rack up alarming amounts of debt on your credit card. By consistently monitoring the activity on your cards, you’ll be able to identify fraudulent transactions more quickly. Today, many cards offer alerts if suspect fraudulent activity is detected on your account.

Also, keep an eye out for a credit card that offers liability against fraudulent charges. This means that you won’t be responsible for paying any credit card charges that you didn’t authorize.

Store the Card for an Emergency

The age of your oldest credit card account is factored into your credit score, so keeping an open account could help you build credit in the long run. By storing your card for emergencies only, you’ll always have at least one account open. Keep in mind, however, that some credit card companies may close your card if you don’t use it after a period of time, so it may be a while to periodically use your card to make a small purchase to keep it active.

Which is Safer to Use Online Debit or Credit?

Both debit cards and credit cards come with safeguards to prevent fraud. When you use a debit card at a grocery store or gas station, for example, you are often required to provide a unique PIN. When you shop with credit online, you’re often required to enter your credit card’s three-digit security code.

Banks and credit card companies are also constantly on the lookout for any transactions that could be potentially fraudulent. In most cases, they will send mobile alerts as soon as they notice suspicious charges or unusual activity on your account.

That said, credit cards offer a few fraud protection benefits that debit cards don’t. Nearly all of today’s top credit cards offer zero fraud liability on unauthorized charges, which means you won’t owe a penny on any charge determined to be fraudulent. Debit cards also limit your fraud liability but require you to report your lost or stolen card within two business days to limit your liability to $50.

If you report after two business days but before 60, your liability goes up to $500. If just your debit card number is stolen and not the card itself, you are not liable for unauthorized charges, as long as you report them within 60 days of receiving your statement.

When it comes down to debit versus credit cards, you might decide credit cards offer better fraud protection. If someone skims your credit card information, for example, you have time to dispute the charge before you’re liable for the payment and the pending charge may never even post to your account.

If you use a debit card, though, the funds can be removed from your bank account directly and quickly, making the process of disputing and getting your money back much more time-consuming.

What is Credit Card and its Benefits?

Almost everyone today has a bit of rectangular plastic in their wallets or purses. That’s the Credit Card and the Debit Card. A few years ago, hardly anyone had a Credit Card. Today, nobody thinks twice about paying for their purchases with a card. It’s not uncommon for people to have several cards. It’s not hard to figure out why.

The Credit Card benefits are too great to ignore. Plus with more banks offering them: the process has become more straightforward, and there are a vast variety of options to suit every lifestyle and spending tendency.

Well, they are numerous. Whether it’s booking a car ride or a movie ticket, purchasing expensive gadgets or a cool fashion accessory, shopping online or at a neighborhood store, recharging your mobile, or settling the utility bill, a Credit Card is one of the most convenient methods of making payments.

Here’s a list of key Credit Card benefits:​​​​​​​

Convenience: Why carry wads of cash around when you can pay with a simple swipe of your card? A Credit Card is one of the simplest ways to pay for anything – no more counting out change or writing cheques, just present the plastic! You can even link your card to your digital wallet, which allows you to scan and pay without even having to carry your card in your wallet. 

Recurring payments: While Credit Cards are great for one-time payments, you can also set it up to automatically make recurring payments such as your phone, electricity or gas bills. No more will there be a chance of forgetting to pay bills on time and facing penalties or disconnection.

Recharges and tickets: One of the biggest Credit Card benefits over cash is the ability to pay for a wider range of online services. For example, you can’t buy flight tickets or recharge your mobile phone with cash on delivery. You can easily pay for them through a Credit Card.

Interest-free credit: A Credit Card comes with a grace period between purchase and payment (could be up to 50 days) during which the bank does not charge any interest. This is a perfect example of buy now and pay later. 

Rewards: Every time you pay using an HDFC Bank Credit Card, you earn Rewards. You can redeem these rewards for exciting gifts and vouchers such as free shopping trips or even free flight tickets. 

CashBacks and discounts: From fuel surcharge waivers to great online shopping deals, your HDFC Bank Credit Card opens the doors to a host of CashBacks offers and Reward Points, especially with selected offline and online merchants. 

Travel in style: The HDFC Bank Credit Card makes your travel a more pleasant experience with free access to exclusive airport lounges, priority check-in and boarding, extra luggage allowance, etc. 

Expense tracker: Credit Card statements are a great way to track your expenses every month since it provides you with an itemized account of your expenditure.

Safer: One of the benefits of Credit Card in India is that it’s much safer than carrying large amounts of cash around. You don’t have to worry about dropping the money somewhere or having your pocket picked. If you lose the card, you can get a replacement after you notify your bank.

Credit score: Most people are not aware of this, but a Credit Card benefits your credit score. Organizations like CIBIL give credit scores to individuals depending on how prompt they have been in their payments. Using a Credit Card and repaying on time provides a boost to your credit score. A good credit score means you will be able to obtain Loans and Credit Cards quickly in the future. It’s one of the Credit Card benefits cash or cheques cannot offer!

Extra Benefits: There are other benefits of having a Credit Card. For instance, if you have a HDFC Bank Credit Card, you can get accidental death cover, and fire and burglary protection on items that you have purchased. So you will be getting insurance coverage without any premium! All you need to do is meet some minimum spending requirements.

How can I Lower my Credit Card Interest Rate?

Credit cards may also come with high-interest rates that make carrying balances expensive for cardholders.

If you currently carry a balance on your card and want to avoid incurring more debt, lowering the interest rate on your card can help. But how do you lower your credit card interest rate without switching cards?

You can negotiate with your bank or credit card company to get a lower interest rate on your card. Although the card company may ultimately say “no,” knowing these steps could help improve your chances of getting a favorable response.

1. Evaluate your current situation

Before you call the customer service number on the back of your credit card, understand what you’re working with. Know your current credit card terms, including the grace period, statement due date and your current credit card balance.

By coming prepared, you’re setting yourself up to do a better job of evaluating the options your credit card company might offer.

Don’t forget to check your credit, as well. You can use this as leverage in your negotiations. Having strong credit may indicate you’re likely to repay your balances and what you owe, so credit card companies may be more willing to meet your requests.

2. Build your credit first if you need to

If you find your credit is less-than-optimal, you may want to work to build your credit health so you look more creditworthy to the bank.

Try to keep your credit utilization rate — the percentage of your credit limit that you’re using — at 30% or less.

3. Find competing credit card offers

Credit card issuers and banks need to compete with other brands to acquire more customers. That means they need to stay competitive with their rates.

Do your homework and look at other available credit cards. If you find a similar card to yours that offers a better rate, note the card’s name, company and terms. You’ll want to share this information when you reach out to the bank.

4. Understand the credit card company’s perspective

You can better negotiate if you understand what the bank or credit card company needs to see on its end to agree to your request. Sometimes a bank would need to ensure customers were at lower-risk before agreeing to drop the interest rate.

5. Call and make your request

Now you’re ready to get your credit card and call the customer service number listed on the back. When you reach a representative, politely explain the reason for your call.

If you have good credit, you can remind the representative of that and point to your history of being a good customer (by regularly using your card and paying your bills on time).

You may want to share your information about the other offers available from different companies, and explain why you may transfer your balance to a new credit card if you can’t get a lower interest rate from your current company. You can also ask if they will at least match the interest rate on a competing card.

6. Don’t be afraid to negotiate again in the future

John Rampton, founder of Due, has successfully negotiated lower rates for his credit cards and does so periodically. He says to expect to haggle and recommends you don’t give up after one call.

From his experience, credit card companies seem more willing to offer lower rates when you ask after making consistent payments on your card for at least six months. He follows up with requests every six months to ask for lower rates until he receives a “no.”

7. Consider a balance transfer credit card instead

Balance transfer cards may provide you an alternative for getting a lower interest rate on your current credit card debt. This may allow you to consolidate your existing balances from multiple cards onto a single, new card.

You’ll want to use a credit card with a 0% introductory annual percentage rate, or APR, offer for balance transfers to save money on your debt repayment.

How can a Customer be Benefited Through Using Credit Card?

You can find almost all banks and financial institutions offering various types of credit cards. They are accepted as a means of payment at any place that offers you goods or services. The uses of credit cards are extended to buying groceries, clothing, and accessories, booking a movie ticket, shopping online, buying home appliances, paying your utility and mobile bills, and many more.

1. Buy on credit:
What makes a credit card attractive is the credit limit allowed to the cardholder. You can buy anything within that limit and pay later. Your monthly budget will not affect, even if you buy items of high value on credit. One of the most important benefits of credit card is you can convert the total amount of your purchases into low-cost EMIs to enable you to repay it easily over a period of time. This has helped revolutionize the shopping experience.

2. Most accepted method of payment:
You can travel anywhere, without carrying much money if you have this card. Being the most accepted method of payment, you can use a credit card to pay for anything.

3. Interest-free cash withdrawals:
There are a few credit cards that allow you to withdraw money up to a certain limit in case of emergency, with no interest charged up to 45 to 50 days. You can make use of it in times of financial emergency.

4. Unlimited reward points:
These cards come with reward points when you use them. For instance, IDFC FIRST Bank credit cards offer unlimited and never-expiring reward points, which are easily redeemable.

5. Insurance coverage:
You get personal accident coverage, as well as comprehensive travel insurance coverage and this is one of the significant benefits of credit cards, which makes them attractive.

6. Make travel easy:
The uses of credit cards in travel make them important. When it comes to IDFC FIRST Bank credit cards, they give you a unique experience through complimentary lounge access at the airports and railway stations in India and priority check-in. Other than these, you can also enjoy discounts on food in more than 280 restaurants.

7. Discounts and cashbacks:
The advantages of credit cards extend to discounts on some of your favorite entertainment and dining outlets, travel and shopping apps, etc. You can also enjoy fuel surcharge waivers at petrol pumps across the country. To check the host of offers, click – https://idfcfirstrewards.poshvine.com/

8. Improve your credit score:
The benefits of credit cards do not limit to shopping on credit; instead, it helps improve your credit score. If you know how to use a credit card and how to make use of the credit period, and repay the amount used on time, you can boost your CIBIL score. This will help you obtain loans, without any difficulty in the future.

9. Offers safety:
You don’t have to carry much money if you have a credit card.

10. Keep track of your expenses:
The statements you get every month from netbanking helps you check your expenses and plan the repayment without any delay. 

Why is a Credit Card the Safest Form of Payment?

Considering how rampant fraud is and that a new major data breach is announced seemingly every few months, security is more important than ever. When you’re picking your primary payment method, there are several key reasons why a credit card is the smartest choice.

1. They’re not connected to your money

Since credit cards aren’t linked to your bank account, they provide an extra layer of security. When your credit card is used, it’s the card issuer that’s paying for the transaction, at least until you pay the bill.

If you were to lose your wallet, you wouldn’t need to worry about someone draining your bank account, like they could with your debit card. You’ll just need to contact your card issuer to get a replacement credit card.

2. You have limited to zero liability for fraudulent charges

Fraudulent charges are a hassle, but at least with a credit card, there are consumer protections that will limit your liability. Here’s what the Fair Credit Billing Act stipulates regarding credit card fraud:

• If you still have the card and someone stole your card number, you’re not liable for any fraudulent transactions.
• If your credit card was lost or stolen and used before you notified your card issuer, you’re liable for up to $50 of fraudulent transactions. However, most card issuers have zero-liability policies and won’t require you to pay anything.

With a lost or stolen debit card, you’d be liable for up to $50 in fraudulent transactions if you report it within two days, up to $500 if you report it within 60 days of the statement with those charges being sent to you, or an unlimited amount for any notifications later than that.

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And even though your bank will be refunding you for some or all of the fraudulent charges, you’ll be out of that money until they’ve investigated.

3. Fraud alerts notify you if your card is compromised

Card issuers now let you provide your phone number to register for fraud alerts. Once your card issuer has your phone number on file and your consent to receive texts, they will send you a message for any suspicious transactions, such as larger-than-usual purchases.

These alerts can be a big help if your credit card number is compromised and you don’t realize it. Instead of having someone else use your credit card without your knowledge for days or weeks, you’ll know right away and can cancel the card.

4. Your card issuer will freeze disputed transactions

Whether you’re disputing a transaction because it’s fraudulent or due to an issue with the product or service, the dispute process will be more convenient for you with a credit card. It goes back to how your credit card isn’t linked to your money.

While you dispute a credit card transaction, your card issuer freezes it, meaning you don’t need to pay for it until the dispute is over. If your card issuer rules in your favor on your dispute, then you don’t need to pay for the transaction at all.

With a debit card dispute, the money would already be gone from your bank account. If your card issuer rules in your favor, then they’ll do a chargeback to get your money back from the merchant, but that means you won’t have that money throughout the dispute process.

5. Chip technology makes it harder to steal your credit card data

By now, all the major card issuers in the United States have moved on to chip cards. That’s good news from a security standpoint because the difference between magnetic strip and chip technology is like comparing an unlocked front door to a bank vault.

The sophisticated encryption of chip cards helps prevent counterfeiters from stealing card information during point-of-sale transactions. In particular, the inexpensive credit card skimmers that counterfeiters would use to steal credit card information aren’t effective for chip transactions.