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Old 27.09.2012, 13:07
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Re: How dumb are Swiss credit cards?

Interestingly, I was going to ask the same question here regarding credit card, but I decided to do a little search over Englishforum and came across this thread..So here goes my story as well..

I went to my bank this morning, BCV and asked them about possibility of getting a Swiss credit card. The person in-charge there told me I can apply for some mastercard which I can use to make purchases within Switzerland or even abroad. Comes with a 100 CHF annual fee.!! But strangely yet, he said I would have to pay the ENTIRE amount I have used on credit card at the end of month by direct debit.. So that was strange to me because in US, I could pay minimum or anything above minimum (ofcourse entire sum also) and keep the balance rolling over for some interest rate..This was my understanding of credit card system. But I was surprised, like the original poster was, when I was told that I need to pay entire sum back at end of month.

So I asked few collegues at work and someone suggested CUMULUS Mastercard...Its free 0 Annual fee, and it works like any other card in US..minimum payment and roll over balance to next cycle for some interest....Plus this works for purchases within Migros also, so points accumulate for purchase on Migro store (1 point per CHF) or outside migro (1 point per 2 CHF)...I like this idea and might apply for it. Any one else using this kind of card ? Does this card come with e-account or e-banking ?

Bilbo
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  #42  
Old 27.09.2012, 14:00
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Re: How dumb are Swiss credit cards?

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But strangely yet, he said I would have to pay the ENTIRE amount I have used on credit card at the end of month by direct debit.. So that was strange to me because in US, I could pay minimum or anything above minimum (ofcourse entire sum also) and keep the balance rolling over for some interest rate..
Credit-based consumer spending exists in Switzerland too but it's not considered a good idea. Why don't you get a consumer credit if you desperately need money? The interest rates for consumer credits are less outrageous than for credit cards.
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So I asked few collegues at work and someone suggested CUMULUS Mastercard...Its free 0 Annual fee, and it works like any other card in US..minimum payment and roll over balance to next cycle for some interest....Plus this works for purchases within Migros also, so points accumulate for purchase on Migro store (1 point per CHF) or outside migro (1 point per 2 CHF)...I like this idea and might apply for it. Any one else using this kind of card ? Does this card come with e-account or e-banking ?
This credit card is issued by GE Money Bank and they offer e-access to your credit card statements. As with most other Swiss credit cards, you pay in case of partial payment interest on the full amount payable and not only on the amount not paid yet. The advantage of this credit card is the interest rate of 9.9%, most other credit cards have interest rates close to 15%.
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  #43  
Old 27.09.2012, 14:05
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Re: How dumb are Swiss credit cards?

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So I asked few collegues at work and someone suggested CUMULUS Mastercard...Its free 0 Annual fee, and it works like any other card in US..minimum payment and roll over balance to next cycle for some interest....Plus this works for purchases within Migros also, so points accumulate for purchase on Migro store (1 point per CHF) or outside migro (1 point per 2 CHF)...I like this idea and might apply for it. Any one else using this kind of card ? Does this card come with e-account or e-banking ?
You write "some interest" so lightly. I read somewhere that if you only pay off the minimum amount on a credit card each month, for a reasonable sum it can take several years to pay off the debt, with several k in interest.
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  #44  
Old 27.09.2012, 14:22
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Re: How dumb are Swiss credit cards?

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We just got our first credit card bill from UBS. I expected it would work like a British credit card... that you pay off how much you want over the minimum amount and are subject to interest on what you don't pay off. Suprised to find that they are going to take the full amount by direct debit!!! How is that CREDIT?? Fortunately the amount was only 7chf, glad I found out before trying to use it as a CREDIT card!
It is credit.....till you get the bill.

It's a wonderful system where individuals are encouraged to live within their means.
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  #45  
Old 27.09.2012, 14:26
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Re: How dumb are Swiss credit cards?

With the PF card you get cash back, that then covers the charge for the card and some (dependant on how much you use it of course)...
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  #46  
Old 27.09.2012, 14:33
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Re: How dumb are Swiss credit cards?

There are people who don't pay of their credit cards each month? How unthrifty.

My s-i-l worked for credit card company for a while. You'd be amazed (or maybe not) at the number of seriously wealthy individuals who pay the minimum each month.
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Old 27.09.2012, 14:33
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Re: How dumb are Swiss credit cards?

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It's a wonderful system where individuals are encouraged to live within their means.
That is not true. A credit card for many people doesn't mean borrowed money. It means convenience..for whenever you don't have enough cash on you.
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  #48  
Old 27.09.2012, 14:47
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Re: How dumb are Swiss credit cards?

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That is not true. A credit card for many people doesn't mean borrowed money. It means convenience..for whenever you don't have enough cash on you.

LOL so we are saying the same thing??!! Those that use a card for convenience and can pay it off each month are those that are living within their means.....!

Again; it encourages individuals to live within their means, meaning those that are not able to pay the full amount....
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Old 27.09.2012, 14:47
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Re: How dumb are Swiss credit cards?

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A credit card for many people doesn't mean borrowed money. It means convenience..
True, my favourite credit card for example has all the advantages and guarantees of a credit card, but acts like a debit, taking the money straight from the account. But if it's just means of payment, you are probably also not interested in making minimum partial payments only, you would just pay it off each month, as the interest rates are usually not that great. Or am I missing something?
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Old 27.09.2012, 14:49
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Re: How dumb are Swiss credit cards?

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That is not true. A credit card for many people doesn't mean borrowed money. It means convenience..for whenever you don't have enough cash on you.
Or for numerous times where only a credit card will do. I make a lot of online transactions: flights, holidays, tech shopping etc and have used a Swiss credit card for these things for years, as it's often either the simplest or the only way to do it. Never once carried a balance over.
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  #51  
Old 27.09.2012, 15:02
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Re: How dumb are Swiss credit cards?

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True, my favourite credit card for example has all the advantages and guarantees of a credit card, but acts like a debit, taking the money straight from the account. But if it's just means of payment, you are probably also not interested in making minimum partial payments only, you would just pay it off each month, as the interest rates are usually not that great. Or am I missing something?
No you are not missing anything, lost in abroad misunderstood my comment.....

My point was those that are not paying off their cards every month are encouraged by the system they have in place here in Switzerland to live more within their means....
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Old 27.09.2012, 15:03
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Re: How dumb are Swiss credit cards?

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LOL so we are saying the same thing??!! Those that use a card for convenience and can pay it off each month are those that are living within their means.....!
Well observed Sherlock!

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Again; it encourages individuals to live within their means, meaning those that are not able to pay the full amount....
You've lost me (and possibly others) of this one. It's a good system for the ones who are not able to pay their bills, as it enrouages them to live within their means?
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  #53  
Old 27.09.2012, 15:07
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Re: How dumb are Swiss credit cards?

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True, my favourite credit card for example has all the advantages and guarantees of a credit card, but acts like a debit, taking the money straight from the account. But if it's just means of payment, you are probably also not interested in making minimum partial payments only, you would just pay it off each month, as the interest rates are usually not that great. Or am I missing something?
This sounds like the 'Visa Debit' card I had in Aus? It was a Visa card, linked only to a normal transacton account. So had all of the functionality of a credit card i.e.. online payments, booking accomodation etc but only from money that was actually there. It didn't go into 'credit' us such (and therefore no payments required).
We don't have credit cards here yet, but I'm wondering what's going to happen when I want to buy online, or a book a holiday (once we've gotten over the financial shock of moving over here )
Our Kantonalbank doesn't have Visa Debit or similarr (or even an iphone app, but that's a whole other PITA topic), not sure if other banks have this? Would sure be handy..
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  #54  
Old 27.09.2012, 15:15
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Re: How dumb are Swiss credit cards?

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Well observed Sherlock!


You've lost me (and possibly others) of this one. It's a good system for the ones who are not able to pay their bills, as it enrouages them to live within their means?

Lost in abroad - clearly!

Living within their means = you don't spend what you don't have!!
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Old 27.09.2012, 15:43
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Re: How dumb are Swiss credit cards?

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This sounds like the 'Visa Debit' card I had in Aus? It was a Visa card, linked only to a normal transacton account. So had all of the functionality of a credit card i.e.. online payments, booking accomodation etc but only from money that was actually there. It didn't go into 'credit' us such (and therefore no payments required).
We don't have credit cards here yet, but I'm wondering what's going to happen when I want to buy online, or a book a holiday (once we've gotten over the financial shock of moving over here )
Our Kantonalbank doesn't have Visa Debit or similarr (or even an iphone app, but that's a whole other PITA topic), not sure if other banks have this? Would sure be handy..
I loved the system they have in Aus, so much more convenient....

Kantonalbank have a Maestro card which is a debit card, payments come straight out of your current account, this is of course limiting if you want to use it for online transactions.
For more flexibility you will need to apply for a credit card, most charge yearly fee's from 0 - 100 CHF Some give cash bonuses so that will help cover the charge of the card if you use it enough....
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  #56  
Old 27.09.2012, 16:22
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Re: How dumb are Swiss credit cards?

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You write "some interest" so lightly. I read somewhere that if you only pay off the minimum amount on a credit card each month, for a reasonable sum it can take several years to pay off the debt, with several k in interest.
If it's a large amount yes, but people really don't realise that when they pay by credit card. More often than not, the purchases end up costing much more than if you'd paid cash.

That said, having something owed on the credit card at the end of the year is quite nice as it can be used as a deduction to lower your tax figures a bit.
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Old 27.09.2012, 16:34
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Re: How dumb are Swiss credit cards?

I wonder why banks and credit card companies in CH want their customers to pay off the bill in full. In the U.S. you can actually get penalized for paying in full - because the company wants that money you pay in interest every month. I had more than one CC canceled because I paid in full or because I didn't use enough of the credit line.
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Old 27.09.2012, 16:56
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Re: How dumb are Swiss credit cards?

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I wonder why banks and credit card companies in CH want their customers to pay off the bill in full. In the U.S. you can actually get penalized for paying in full - because the company wants that money you pay in interest every month. I had more than one CC canceled because I paid in full or because I didn't use enough of the credit line.

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US - Immoral!
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Old 27.09.2012, 17:46
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Re: How dumb are Swiss credit cards?

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That is not true. A credit card for many people doesn't mean borrowed money. It means convenience..for whenever you don't have enough cash on you.
For me it's convenience and protection. A few years ago, I bought some tickets for a concert, then the ticket vendor went bust before the tickets went out, and UBS refunded the transaction to my card (once I'd forwarded them the official receiver's letter).

When I spend I get points that more than enough cover the cost of the card.

As a means of credit, cards should be third to last resort. Pay-day loans second to last and the mob as the last.
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Old 27.09.2012, 17:51
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Re: How dumb are Swiss credit cards?

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I wonder why banks and credit card companies in CH want their customers to pay off the bill in full. In the U.S. you can actually get penalized for paying in full - because the company wants that money you pay in interest every month. I had more than one CC canceled because I paid in full or because I didn't use enough of the credit line.
They most probably get enough money from the shop holders. AFAIK every transaction is billed by them with between 3 and 5 %. Easy money with hardly any risk behind.
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