Credit cards and your expandable wallet

During the 1920s the first ever credit card was introduced in rural America and since its humble beginnings the idea has spread rapidly to a point where it now dominates the credit market. These iconic, rectangular plastic cards can be found in wallets and purses throughout the world, offering holders the chance to pay for purchases over a period of time that best suits their individual needs.

The growth in technology since the inception of credit-cards has allowed transactions to be made anywhere on the globe, giving travellers a hassle free way of buying goods and services whilst in foreign lands and reducing the chances of being a victim of crime by removing the necessity to have large sums of cash in their possession.

Retail stores now hold sales throughout the year - a change from the past where they were held at a predetermined time of year and allowed shoppers to save up in order to splash out during sales and take advantage of great deals. Many stores now offer the facility to get instant credit, thus equipping modern shoppers with the financial ability to fully benefit from such impromptu opportunities and pay back the cost over a period of time to suit their financial situation.

When you pay with a credit card, the retailer is given the full amount of the purchase by the credit-card company, who then in turn record this against your account balance. You are sent statement of your account at the end of each month which details all your transactions, and asked to make a minimum payment, as agreed with the company. If the card holder does not clear the balance they will be charged interest on the remaining sum. The amount of interest to be charged varies widely depending on which supplier you use.

Increasingly, the design of UK credit cards and the artwork they feature have become important to those who have them. There is a diverse array of facades in the public domain including cards with animals, racing cars, sports teams and even celebrities on them!

Some credit-cards offer you loyalty bonus schemes where you receive points for every pound you spend on your credit card and can be redeemed for monetary vouchers to spend in your favourite high-street stores or other rewards such as discounted airline travel or hotel stays. Similarly, for those who wish to do some good for the wider community, some credit-card suppliers offer to make donations to well known charities in whenever you use your card.

There are a number of attractive credit card deals available offering initial low rates of interest or even periods of interest free spending to lure customers to sign up to their services. However, after a fixed period the level of interest usually increases, so with many suppliers fighting to gain your custom it is well worth shopping around to compare the many different credit cards on the market, to ensure you get the best deal out there.

Andrew Regan is a part time writer and journalist.