Interesting info on credit card use in different cultures

[loosechickens]

Saw this today and thought you guys might find it interesting:

http://www.foxbusiness.com/personal-finance/2011/01/05/different-cultures-handle-credit-cards/?intcmp=prn_baynote-js_How_Different_Cultures_Handle_Credit_Cards

"Other cultures also differ in their propensity to use credit cards at all. The average American makes $4,236 in credit card transactions a year, according to business intelligence firm Euromonitor International. Australians and Canadians spend more, making $7,889 and $7,406 in credit card transactions respectively. On the flip side, the average French citizen makes $267 in credit card charges annually, and Germans on average charge only $158 a year. (See chart on global credit card and savings statistics.)"

Some really interesting stuff in the article......somehow I didn't realize how much cultural differences influence this. Once you read it, it seems obvious, but was new information to me, and may be to some of you as well.

[iris lily]

But what does it mean?

I make a ton more purchases on credit cards than I did ten years ago. But I don't have debt, it's just a way of buying. Remember when grocery stores wouldn't take credit cards? That wasn't long ago. Now each time we go into the store our purchases go on a card, usually DH's card.

I make more credt card purchases than the average American. OTOH, I don't buy much beyond what's on my credit card. 75% of my buying is put on a card.

[kib]

Same here. I'd estimate $20,000 a year goes through the card and maybe $5,000 doesn't, but we have no debt at all.

[Dharma Bum]

Card use seems as frequent (or more) to me in Europe as in the US, but maybe they are debit cards? I still use a credit card for safety reasons which may or may not still be valid. Seems like a incomplete comparisson if they are not factoring in people who use credit/debit for convenience and which card type is used is a function of local country pricing or laws on account rights.

[Rosemary]

We use credit cards for almost everything, but carry zero debt on them. It's for convenience and ease in tracking our spending.

I think a big factor in the difference between usage is the types of businesses - for instance, in Germany there are many, many small shops, and while some of them do accept credit cards, they will often add a fee for the cost of processing the transaction - like 5%. In the U.S., I presume the fees are built into the purchase price of items.

[loosechickens]

yeah, we use our credit card for a majority of our expenses, but pay the entire balance every month as well.

I posted that little excerpt, but if you clicked on the link and read the entire article, you'd see that those questions were covered in it, as the Germans, for instance, depend on electronic bank transfers and Paypal rather than credit cards, etc. And the fact that cultures that do not depend much on credit cards have much higher savings rates, etc. As I explored the complete article it was interesting to see the cultural differences, that's all.

[kib]

I do think that as a general rule, a culture incurring the majority of their expenses in form that will seamlessly translate into debt if they don't take an active role in preventing that is destined for more personal debt. Present company excluded of course, it seems like many people in this country just take debt as a matter of course, like taxes and cavities. I'd be just as happy to put all my transactions on my debit card if it 1. paid 1-5% on all my charges and 2. was as secure as paying with a credit card - and I think for a lot of people, that arrangement would be an extra safeguard against the "debt happens" mentality.


ETA: One other thing I'd have to ask is how is "savings" calculated. Because if you're going to pay your bills out of your savings account instead of through your credit card, you're going to put more money in accounts designated as savings. But you're also going to take more out.