How to Avoid Using Credit Card Cheques

Credit card cheques allow credit card holders to make purchases from organisations that don’t accept credit cards. They also allow the card holder to make cash payments into a bank account. However, cashing credit card cheques has a downside. You do not enjoy the same interest-free period or insurance protection, interest rates are far higher and banks invariably levy a handling fee. Avoiding using these cheques is therefore in your interests. Here’s how.

Difficulty: Moderately Easy

Instructions

1. Keep your economic situation stable. This is a simple piece of advice, but it is only in desperate times that cashing credit card cheques becomes a tempting alternative.

2. Research the terms and conditions for using credit card cheques. Hidden charges abound and interest rates of double the normal are common. Therefore, using these cheques can sink you further into debt.

3. Research what fraud cover you have when using credit card cheques. Normally you will find that any transaction using the cheques is treated as a cash transaction. You typically will not be covered by a warranty if the product you purchase is faulty. This alone should be enough to put you off using them.

4. Whenever possible, avoid shops that do not accept credit cards. While this is the only circumstance in which the use of these cheques may be useful, try and avoid them if you can.

5. Shred unsolicited credit card cheques as soon as they arrive. This will remove the temptation and will prevent anyone else from using them. Fraudulent use of unsolicited cheques is an growing crime in the UK. A thief can use these cheques to transfer money into an account. No PIN number or verified signature is required.

6. Contact your credit card issuer and ask them not to send you unsolicited cheques.