Credit cards have been used in the United States since the early 1920’s, today they are used worldwide and are part of our everyday life. Credit cards allow people to carry around large amounts of money without actually having the bills on them, these cards allow us to quickly access our money and buy things we want and need. . The effect of credit cards on the economy is very complex, it has a positive and negative outcome.
The financial stability of the economy depends on us as consumers, every time we buy something it puts more money into circulation. This means that when consumers spend a lot of money buying things the economy has a lot of money circulating throughout it. In recent years there has been a decrease in the amount of actual …show more content…
Credit cards and debit cards get confused, a debit card the money is pulled directly from your bank account but with a credit card money is basically charged against you. Young business owners especially tend to suffer from credit card debt. “Many consumers and small businesses that use credit cards to finance operations suffer from what advocates of the new law termed "exploitive practices," such as high fees for overdrawn accounts. But it 's also true that in virtually every case these people signed agreements -- perhaps without reading the fine print -- that authorized those terms.”(Rozenberg,2006) Upon applying for a credit card, many people are not aware of the strict penalties that credit cards …show more content…
When some files for bankruptcy they are not able to pay back bills they owe, many of those bills are bills related to credit card debt. This affects the economy because most of the money that is owed is not paid back, so companies experience a loss in product. According to Rozenberg, “Only 0.2 per cent of the population were facing insolvency, he said, but added that the significance of the difficulty they faced should not be played down. Last week it emerged that the number of personal bankruptcies in England and Wales leapt to 23,251 in the first quarter, the highest number since the Sixties.The figure was up 73 per cent from the same period a year earlier, the Department of Trade and Industry said.”The effect of credit cards on the economy on a global scale may seem small but the above text shows us that even though the effect is not significant, it is growing. Right now the effect on the economy may be small now but it is continuously growing, at some point the effect will become
The financial stability of the economy depends on us as consumers, every time we buy something it puts more money into circulation. This means that when consumers spend a lot of money buying things the economy has a lot of money circulating throughout it. In recent years there has been a decrease in the amount of actual …show more content…
Credit cards and debit cards get confused, a debit card the money is pulled directly from your bank account but with a credit card money is basically charged against you. Young business owners especially tend to suffer from credit card debt. “Many consumers and small businesses that use credit cards to finance operations suffer from what advocates of the new law termed "exploitive practices," such as high fees for overdrawn accounts. But it 's also true that in virtually every case these people signed agreements -- perhaps without reading the fine print -- that authorized those terms.”(Rozenberg,2006) Upon applying for a credit card, many people are not aware of the strict penalties that credit cards …show more content…
When some files for bankruptcy they are not able to pay back bills they owe, many of those bills are bills related to credit card debt. This affects the economy because most of the money that is owed is not paid back, so companies experience a loss in product. According to Rozenberg, “Only 0.2 per cent of the population were facing insolvency, he said, but added that the significance of the difficulty they faced should not be played down. Last week it emerged that the number of personal bankruptcies in England and Wales leapt to 23,251 in the first quarter, the highest number since the Sixties.The figure was up 73 per cent from the same period a year earlier, the Department of Trade and Industry said.”The effect of credit cards on the economy on a global scale may seem small but the above text shows us that even though the effect is not significant, it is growing. Right now the effect on the economy may be small now but it is continuously growing, at some point the effect will become