It’s been a while since I’ve done an article commentary. This one really set me off, so it’s been in the queue for a while. I’ve said that journalism is dead many times and that many new articles you read are either opinion pieces or are sponsorship pieces to promote one thing or another or to detract from someone’s competitor.
This article is not really any of those. It feels to me that the author had an idea and just thought up reasons as to why that idea might be true. It’s actually not too far removed from the bullshit I post here on my blog. I could be getting paid for this fuckery?
So let’s start, then. The article is saying that credit cards are going to disappear and people are going to stop using them in favor of other forms of payment. And that other form of payment isn’t cash!
These are the reasons why:
- Credit cards often aren’t 100% secure. It’s going to be anticlimactic to provide the whole reason why every other payment option pitched by this article is inferior. A credit card has consumer protections in place in case you are hacked or have your card stolen or lost. You are not liable for fraudulent charges. I’m going to harp on this quite a bit.
- Credit cards have high fees. Where the fuck are you getting your credit cards from? There are many, many, many credit cards with no annual fee. Any other fees you would incur would be from transactions that you couldn’t even accomplish via other methods, like cash advance or balance transfer.
- Credit cards are rarely accepted worldwide. Yes, they are. Nothing else to say here.
- Digital payments are more convenient than credit cards. PayPal, Venmo (who?), Amazon Cash, PayTM (who?) are somehow easier to use than a credit card. In the case of Amazon and PayTM, you have to add cash to your digital wallet using an online application. If you want to add cash to your Amazon account, you can go to a store and they can add the balance to your account with a special barcode. This is more convenient? HOW?
- It’s easier to exchange money between friends, and for an employer to pay employees digitally than using a credit card. This isn’t even a valid scenario for a credit card, so how is that any sort of proof that credit cards are obsolete?
- Unbanked/underbanked individuals can’t get a credit card. So that means credit cards are obsolete? No one else needs them?
- You don’t need a wallet anymore, only your mobile phone. Sounds wonderful, except for the need to carry ID cards, reward cards, and insurance cards. Then there’s the small problem of losing your phone, which has all your eggs in one basket. Or dropping your phone, or running out of battery, or not having cell signal in a building with a steel roof, or whatever wonderful things happen in the digital world that just never seem to happen in the physical.
- Bitcoin and other cryptocurrencies let users stay anonymous. Yes, because when you order something online, you don’t give out any personal information. That’s how sales transactions work. Who fucking cares if you’re ordering a case of dildos?
Now, here’s some statements that I really want to punch in the face:
“This points to an important truth: Even for most online payments, cards simply aren’t necessary.” – Cards are absolutely necessary for online payments because of the aforementioned consumer protection.
“Since so many people already use smartphones for day-to-day payments like ordering food or hailing an Uber, ditching wallets altogether seems like the logical next step.” – The ability to do two things (neither of which I’ve done) means we should just eliminate wallets. That’s totally logical. Now I can hear you, “just because you don’t do it doesn’t mean it shouldn’t be done.” Well, just because some people do do these things, doesn’t mean that’s the eventual solution.
“[Bitcoins,] Unlike credit cards, they have low transaction fees and don’t require sales tax.” – Your payment method has zero bearing on how you are taxed for a purchase. And what transaction fees? Currency conversion is even free with my no-cost Capital One card.
And the summary: “After all, for consumers, the motivation to ditch the card is simple: lower fees, improved convenience, and increased financial independence.”
If you are ditching a credit card because of the fees, you’re doing it wrong. If you think any other payment form is more convenient (and safer) than a credit card, I don’t know what to tell you. If you think you are somehow going to succeed financially by ignoring a significant source of credit history that can determine how you can afford to purchase a house, lease or buy a car, get an apartment, get utilities turned on without a hefty deposit, or get a better insurance rate, then by all means, try it. Then complain at how difficult it is to not have a solid credit file. Also, you can enjoy not getting any rewards for using credit cards for your daily purchases. If you have the self-control, you can utilize credit cards to get significant cash-back rewards.
Call me old-fashioned, but the mindset set forth in this article is foolish.
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