Cambodians and credit cards
My Canadia bank ATM card expired a few months ago. And the new one does have the Visa logo's on it, suggesting it's a credit card. TBH, I do think, it's a factual debit card with direct debit. I think, Visa provides the cards to Canadia bank, with the corresponding savings for the bank (And the customer footprint gain for Visa).
The usual "credit card", is effectively not a credit card, though a charge card, where you do have to pay the debit amount every month. Only once you don't pay every month and you start building up a debit status with the CC company, your card gets a credit status (or not, if you're not granted the debit status .....).
I don't like the Visa status for the ATM card, since it will be tempting for the in-laws, to start using their ATM card for shop spendings, they don't have the resources for and they run out of money, before new money comes in.
The usual "credit card", is effectively not a credit card, though a charge card, where you do have to pay the debit amount every month. Only once you don't pay every month and you start building up a debit status with the CC company, your card gets a credit status (or not, if you're not granted the debit status .....).
I don't like the Visa status for the ATM card, since it will be tempting for the in-laws, to start using their ATM card for shop spendings, they don't have the resources for and they run out of money, before new money comes in.
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I made a mistake when I first came to Cambodia opening an account with Canadia bank, they asked if I wanted to have a visa credit card for $10 charge annually, I just thought they didnt understand the differences between credit card and debit credit card when they took $2000 out of my normal account to my credit account. Only learned later I was charged something 22% when withdrew cash from Canadia Visa card. When I went into the branch in person to check the bank statement on my bank book 2 -3 months later, there were some sort of withdraw fees too if I remembered correctly. Needless to say I closed my Visa card right there on the spot, ended up costing me an additional $20 for early cancellation.
The difference between Debit & Credit cards has been discussed & explained many times on numerous threads. You have been issued a Debit Card...not a Credit card. Banks don’t just issue people credit cards, you need to apply, or they may offer, but they cannot just issue people credit cards without the consent of both partiesv12 wrote:My Canadia bank ATM card expired a few months ago. And the new one does have the Visa logo's on it, suggesting it's a credit card. TBH, I do think, it's a factual debit card with direct debit. I think, Visa provides the cards to Canadia bank, with the corresponding savings for the bank (And the customer footprint gain for Visa).
The usual "credit card", is effectively not a credit card, though a charge card, where you do have to pay the debit amount every month. Only once you don't pay every month and you start building up a debit status with the CC company, your card gets a credit status (or not, if you're not granted the debit status .....).
For those who still don’t understand the difference...
ATM cards
An ATM card is a PIN-based card. That means that in addition to using it at ATMs, you may also be able to use it to make purchases (by entering your Personal Identification Number) if the merchant is using one of the same electronic ATM networks that’s listed on the back of your card.
Debit card
A debit card looks just like a regular ATM card, and you can use it at ATMs. The difference is that a debit card has a Visa® or Mastercard® logo on its face. That means you can use a debit card wherever Visa® or Mastercard® debit cards are accepted, for example, department stores, restaurants, or online.
Credit card
A debit card is not a credit card. When you use a debit card, the money is deducted from your checking account. With a credit card, you’re borrowing money to be repaid later.
Debit cards and credit cards work in similar ways. Both carry the logo of a major credit card company, such as Visa or MasterCard, and can be swiped at retailers to purchase goods and services. The key difference between the two cards is where the money is drawn from when a purchase is made. When a consumer uses a debit card, the money comes directly from his checking account. When he uses a credit card, the purchase is charged to a line of credit for which he is billed later.
Consider two customers who each purchase a television from a local electronics store at a price of $300. One uses a debit card, and the other uses a credit card. The debit card customer swipes his card, and his bank immediately places a $300 hold on his account, effectively earmarking that money for the television purchase and preventing him from spending it on something else. Over the next one to three days, the store sends the transaction details to the bank, which electronically transfers the funds to the store.
The other customer uses a traditional credit card. When he swipes it, the credit card company automatically adds the purchase price to his card account's outstanding balance. He has until his next billing due date to reimburse the company, by paying some or all of the amount shown on his statement.
With most credit card companies, the customer has 30 days to pay before interest is charged on the outstanding balance, though in some cases, interest starts accruing right away. Interest rates on credit cards are notoriously high (they are key way the credit card companies make money). Savvy consumers avoid paying it by settling their balance in full each month.
The Debt Instrument Difference
By definition, all credit cards are debt instruments. Whenever someone uses a credit card for a transaction, the card holder is essentially just borrowing money from a company, because the credit card user is still obligated to repay the credit card company.
Debit cards, on the other hand, are not debt instruments because whenever someone uses a debit card to make a payment, that person is really just tapping into his or her bank account. With the exception of any related transaction costs, the debit user does not owe money to any external party: The purchase was made his or her own available funds.
In Cambodia, banks have implemented a safety measure when issuing Credit Cards...while you still spend money on credit, you are required to maintain the balance, or percentage, of the credit line in a fixed account. Can’t remember the precise details off the top of my head, but I’ve posted about it before, will try and find.
I'm not a negative person, I encourage people all the time...it's usually to f**k off! But, whatever.
Yep, I know, though it still does have the issue of "to easy spending money". No problem for me (I've got a stack of cards), though the in-laws do have to many holes in their hands ..... So, for them, I need the Visa part (whether debit or credit) being disabled, which was not possible (at that time, I hope it has changed, because one other needs to get an account with ATM card).PSD_Kiwi wrote:..... You have been issued a Debit Card...not a Credit card.v12 wrote:My Canadia bank ATM card expired a few months ago. And the new one does have the Visa logo's on it, suggesting it's a credit card. TBH, I do think, it's a factual debit card with direct debit. I think, Visa provides the cards to Canadia bank, with the corresponding savings for the bank (And the customer footprint gain for Visa).
The usual "credit card", is effectively not a credit card, though a charge card, where you do have to pay the debit amount every month. Only once you don't pay every month and you start building up a debit status with the CC company, your card gets a credit status (or not, if you're not granted the debit status .....).
Yep, for that, banks do have T&C, though a Khmer is not going to read that. When I was at the bank, they referred to the Visa - enhanced ATM card as a credit card, "so easy". The girl telling me, probably did not know the difference, let alone the consequences.PSD_Kiwi wrote:Banks don’t just issue people credit cards, you need to apply, or they may offer, but they cannot just issue people credit cards without the consent of both parties
In order to avoid the issue of “ too easy to spend money”, keep the bulk in a separate acct not linked to the card, keep minimal in the acct which is linked to the debit card, if you need to make a purchase then transfer funds. If there’s no money in the debit card account, then it’s not too easy to spend...unlike a credit card.
That’s what I do for both mine and the missus’ debit cards, it’s also a security measure against card fraud.
That’s what I do for both mine and the missus’ debit cards, it’s also a security measure against card fraud.
I'm not a negative person, I encourage people all the time...it's usually to f**k off! But, whatever.
Yeah, tried that split account option to, just as I do in my country of birth.PSD_Kiwi wrote:In order to avoid the issue of “ too easy to spend money”, keep the bulk in a separate acct not linked to the card, keep minimal in the acct which is linked to the debit card, if you need to make a purchase then transfer funds. If there’s no money in the debit card account, then it’s not too easy to spend...unlike a credit card.
That’s what I do for both mine and the missus’ debit cards, it’s also a security measure against card fraud.
Though Canadia bank does have a very stupid account mechanism. The normal accounts do have huge monthly maintenance costs, whereas their savings accounts do have roughly the same (ATM/ebanking) features but have very low maintenance costs and give interest to. The only drawback is, you can open only 1 account with the savings classification.
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ABA banking app is so on point it's ridiculous. You can create virtual visa and master credit cards, transfer anywhere, pay bills, top up phones, send money to people's phones so they can redeem at ATMs etc etc. Brilliant services.LaudJohn wrote:I use a visa Debit card from ABA. Works just like a credit card for online and in shops.
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Lucky Lucan wrote:Of course rich people here have credit cards. The local banks don't offer what might be considered credit-cards in the west though. You have to have a reasonable balance maintained, like $2000 or so, and can't spend more than that sum, which effectively makes them debit cards. It's only in recent years that many have started using banks at all though, it was very much a cash economy for a long time and people just hid their wedges and gold around the house.
This.
And as mentioned, the ABA visa cards are essentially debit cards. When my wife opened up an account at ABA she had only a hundred dollars or so on her and they were happy to give her the Visa debit card along with a regular debit card. I can't speak for other banks.
As others in the thread have said, in Cambodia they aren't greatly useful except for online purchases and booking hotels / flights. For those that don't leave the country or purchase online, there is little need to have one. When I used to live near a lucky supermarket, I would use my master card since it has 3% cash back reward, which adds up. Back in the west it was easy to make 600+ per year in rewards off that and other cards. So, that was a nice bonus.
Also, for those thinking having a credit card is nothing to aspire to, here are just a few reasons, unless you intend to live on a farm your whole life in Cambodia.
1) Rewards & benefits (cash back, extended warranties, travel insurance, etc etc)
2) Building your credit score.
3) Insurance - as a benefit of the card, and insurance in case of emergency.
4) Online purchases
5) Convenience - booking flights, hotels, etc. Tap to pay.
Of course some of these benefits don't apply if you can't pay your balance monthly, or don't intend to leave Cambodia.
Even here in Cambodia, having credit cards has saved my ass a couple of times.
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Are you offsetting the 3% cash-back against the foreign transaction fee and the crappy exchange rate they offer?holidayinkh wrote:Lucky Lucan wrote:Of course rich people here have credit cards. The local banks don't offer what might be considered credit-cards in the west though. You have to have a reasonable balance maintained, like $2000 or so, and can't spend more than that sum, which effectively makes them debit cards. It's only in recent years that many have started using banks at all though, it was very much a cash economy for a long time and people just hid their wedges and gold around the house.
This.
And as mentioned, the ABA visa cards are essentially debit cards. When my wife opened up an account at ABA she had only a hundred dollars or so on her and they were happy to give her the Visa debit card along with a regular debit card. I can't speak for other banks.
As others in the thread have said, in Cambodia they aren't greatly useful except for online purchases and booking hotels / flights. For those that don't leave the country or purchase online, there is little need to have one. When I used to live near a lucky supermarket, I would use my master card since it has 3% cash back reward, which adds up. Back in the west it was easy to make 600+ per year in rewards off that and other cards. So, that was a nice bonus.
Also, for those thinking having a credit card is nothing to aspire to, here are just a few reasons, unless you intend to live on a farm your whole life in Cambodia.
1) Rewards & benefits (cash back, extended warranties, travel insurance, etc etc)
2) Building your credit score.
3) Insurance - as a benefit of the card, and insurance in case of emergency.
4) Online purchases
5) Convenience - booking flights, hotels, etc. Tap to pay.
Of course some of these benefits don't apply if you can't pay your balance monthly, or don't intend to leave Cambodia.
Even here in Cambodia, having credit cards has saved my ass a couple of times.
In your home country you can, if you clear your balance in full each month, make money from the rewards. I’d say probably not if you are making foreign transactions.
Credit card companies aren’t stupid. They are making good money.
One thing they used to do and probably still do, which many people don’t realise is... when you use your credit card to lift cash they charge you interest from date of transaction and not from the end of month statement date.
Coupled with with foreign currency charges this can be a great little earner for them.
.And as mentioned, the ABA visa cards are essentially debit cards. When my wife opened up an account at ABA she had only a hundred dollars or so on her and they were happy to give her the Visa debit card along with a regular debit card. I can't speak for other banks.
The ABA Visa Debit cards are essentially debit cards because that is exactly what they are...debit cards! They also offer Visa Credit cards and regular ATM cards.
Don’t confuse ATM cards with Debit Cards, or Debit cards with Credit cards
I'm not a negative person, I encourage people all the time...it's usually to f**k off! But, whatever.
I have an ANZ credit card which requires no fixed deposit, nor any other sum held with the bank. It is a true credit card which I pay off each month but which has a minimum payment option. I thought it was strange they gave me this as a foreigner but maybe it’s because I work for another bank and have been around a long while. Apparently Aeon will also extend a true credit card to foreigners. Both require three months bank statements and a letter of employment verification. ANZ took nearly two months to approve my application.
yes 'tis once again the season to buck for an IMF bailout. and they are all bucking as hard as they can
no replying to those who misinterpret/misread what i write. this aint kindergarten
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