What is a credit card swipe?

A credit card is a tool that allows the owner to make transactions within a certain credit limit without having money available in the account. Simply put, the user is always provided with a certain amount of money in advance from the bank so that he can spend freely within that amount and pay it back later.

In the age of technology, swiping credit cards is considered an indispensable activity when using cards for transactions and payments. Swiping credit cards is the action of customers using credit cards to make transactions on POS machines at shopping points.

The card swiping operation depends on the type of credit card. If it is a chip credit card, it will be inserted into the chip card reader, if it is a magnetic card, it will be swiped through the magnetic card reader.

How to swipe a credit card on a POS machine

When paying for purchases or service bills, users swipe their credit cards at handheld POS machines or fixed POS machines. The process is as follows:

Step 1 : Staff receives card from customer and operates on POS machine.

Step 2: Determine the type of credit card to pay, magnetic card, chip card or contactless card to swipe the card correctly. For magnetic cards, select the card swiping method. For chip cards, select the card attachment method. If it is a contactless card, select to tap the card at the top of the SmartPOS machine.

Step 3 : When the POS machine displays the cardholder information, the customer enters the amount to be paid or the CVV/CVC security code (if required).

Step 4: The system will display a confirmation box for the cardholder. The customer signs the receipt when the transaction is successful.

Note that the credit card swiping process often has many potential risks related to personal information leakage, additional transaction fees, etc. Therefore, customers need to be careful when paying bills via credit card at POS points.

Some cases should not swipe credit card payment

To ensure safety, users should not swipe credit cards to pay in the following cases:

Unable to manage expenses

Using a credit card without good financial management can bring many disadvantages such as uncontrolled spending, leading to a long-term credit balance. This causes the cardholder to be charged a penalty fee for late payment of credit card balance.

Have a bank loan

Basically, unsecured loans and credit card swipes are quite similar. The actual difference lies in the interest rate and limit. Specifically, credit cards are exempt from interest for 45 - 55 days from the date of transaction. After this period, the bank will charge interest (from 26% - 33%) on the previously unpaid debt.

With unsecured loans, customers need to pay the debt and interest monthly. If late, they will have to pay an interest rate of about 20%/year.

Unpaid credit card balance

Customers need to plan to pay off old debt before using credit cards. This helps reduce financial burden and limit penalty fees from banks.