5 Surprising Facts About Credit Cards | You probably don’t give much thought to your credit card when you go to reach for it. These small plastic cards have a long history and are surprisingly interesting things. The next time you reach for your card to make a purchase, keep these surprising facts in mind.
- You can tell which industry issued the card by the first number.
The first digit of a card indicates what industry issued it, which is why all cards from the same provider begin with the same number. Airline cards start with 1 and 2, travel and entertainment cards begin with 3, banking institutions begin with 4 and 5, merchandising and banking begin with 6, gas cards begin with 7, telecommunications begin with 8, and national standards bodies begin with 9.
- Your card expires, but your account doesn’t.
A physical card can endure three to four years of swiping and daily use. The expiration date of your card reminds your card issuer to send a new card before your card becomes too worn to use. It also serves as a measure of identity theft protection for cardholders. Should your card be used past its expiration date, transactions will be declined.
Having the right type of bank account with the right financial institution is key to building your personal finances. Financially savvy Canadians rely on online banks more than traditional banks. Simplii Financial and Tangerine Bank are two of the most popular online banks. The digital financial institutions have the same low-cost banking product offerings and operational models, but their options and perks do differ.
You can check a comparison of the must-knows between Tangerine vs Simplii. Tangerine Bank features checking accounts and savings accounts with no monthly fees and unlimited debit transactions. Their online banking includes a mobile app and comes with free cheques. Simplii Financial features savings accounts, TFSA, and RRSP bank accounts with no monthly fees and free debit transactions. They offer free Interac e-transfers, free cheques, and a mobile app.
- There’s no cap on credit card interest.
Card issuers can hike up the interest rate as much as they like, even if you signed up for a lower interest rate. The top card-issuing financial institutions are federally chartered, meaning they don’t follow state laws that limit interest rates. Under the Credit Card Accountability, Responsibility, and Disclosure Act, your interest rate is protected for the first 12 months after being issued. After holding a card for a year, your issuer can charge you a higher interest rate, even if you are a responsible customer.
- You don’t need to carry a balance to build credit.
Credit cards are useful tools for building credit, and you don’t need to carry a minimum balance to build good credit. The smart way to use cards is to pay the balance in full each month. Not paying the total minimum payment may cause your card issuer to report a missed payment. This puts a dent in your credit score and affects your eligibility for additional cards. Paying more than the minimum balance due is a smart way to pay down debt.
Buying what you know you can afford to pay for prevents you from maintaining a balance. At Chicos off the Rack, you can find impressive promotions on final sale items, including the classic tunic. Tunic dresses and tunic tops have sleeves of varying lengths and come to the hips to provide function and form. When you sign up with your email address, you’ll receive an additional discount to apply at checkout.
- Credit cards were used in the 19th century.
19th-century farmers used to rely on credit from local general stores for part of the year, due to seasonal income. Stores kept track of who used credit by issuing cardboard cards. The rudimentary cards helped identify which accounts belonged to which customers.
Remember these surprising facts the next time you reach for your little plastic card.