What's your thought about credit cards? Do you consider them a banking fraud, just to trick you to spend money you don't have, or a useful tool if used correctly? Do you have one yourself? In my case, as a student, I was issued a university card, which features a low yearly fee but also a considerably low credit limit. However, I often use it to pay bills in interest free installments (Car insurance for instance) and my gas expenses, which provide a decent cashback (I'll fill up my car once or twice a year for free).
On the other hand, there are quite a few shops here that also offer interest free installments, that way, I was able to purchase a bicycle for my girlfriend, when the budget was quite limited.
The trick on credit cards is to use them wisely, not spending more than you can afford, always pay in time, otherwise you'll get a huge interest on your balance, while at the same time, you're building a credit score.
What's your take on this? Are you against credit card usage?
It's easy to consider credit cards as scams, but in reality for the tens of millions of people who use them in many countries around the world they are simply a useful tool to help manage your finances. They are not a scam at all in fact, however they require a lot of restraint and are potentially given to people who shouldn't have them. They actually give a big benefit to any sensible user by offering certain buyer protections and giving you an advance credit line which will cost nothing if paid off in full every month. The ridiculous interest rates they charge are only ever relevant if you do not pay off that bill every month and that is where the trap can lie - the worst approach to credit card spending is thinking you in any way have access to "free money", that is the psychological trap that many people suffer.
That's the trick banks use. At least in the past, they used to mass distribute credit cards, without any background check, luring them into spending money they don't actually own. Especially with installments, it's easy to get carried away thinking that it's only 40-50 euros per month, equally distributing the cost of products, making them seem more affordable than they are. The main reason I got my credit card was to buy my motorcycle without having to pay interest if I were to take a loan, or to avoid spending all my money at once, while taking advantage of any cashback I can.