How credit cards work
Build your knowledge and confidence on choosing and using a credit card.
For a quick summary, watch our short video
Credit card transaction types
Frequently asked credit card questions
A debit card is linked to your current account. When you use it, money is taken from your account balance.
A credit card is a separate account. When you use it, you borrow money you’ll need to pay back later.
There are more complex differences though, including the costs for using one or the other.
1. What do you need a credit card for?
Most credit cards are created with a specific use in mind, although some offer a range of benefits.
2. Consider your options
- Does this option suit my borrowing needs, or should I consider other alternatives?
- Will I be able to make repayments, even if my circumstances change?
3. Compare card features carefully
As well as looking at any introductory interest rates, look at differences in account fees and charges.
Many credit card issuers provide an eligibility check tool, helping you to narrow down your search to credit cards you are eligible to apply for. The Bank of Scotland version is called One Check.
The maximum amount you can borrow is also known as your credit limit. This is set based on an assessment of your personal circumstances when you open your account, but it can also change over time if you’re offered a different limit, or you request one.
You’ll find your current credit limit on your latest statement, or you can check it online using Internet Banking.
You can use a credit card in most countries outside of the UK.
Just bear in mind that fees may apply when you make transactions abroad, so it’s a good idea to check your account terms and conditions before you travel.
Most credit card purchases of over £100 and up to £30,000 are covered by Section 75 of the Consumer Credit Act 1974, which means you could claim a refund if something you’ve paid for is faulty, doesn’t arrive or isn’t as described.