Tuesday, October 16, 2007

My New Card

Till recently I had two debit cards, given to me by my college, but issued by different banks. Both of them are free for me, and both are Visa Electron. (By the way, I was so surprised to learn that this type of Visa cards is not issued in the US, Canada and Australia. It's the most popular debit card here in Russia.) Well, the first one is an excellent card which is very convenient. But I never liked my second card. It has no online banking, the customer service is poor, and the number of available ATMs is limited. But my college puts my stipend on it, it costs nothing, and I need to have a second card in case the first one is rejected at a point of sale. So I kept using it.

I've just gotten a new card, which is a debit Visa Classic. It's also free, has convenient online banking, gives me a 5% discount at my grocery store and the location of ATMs is good. The checking account linked to the card will earn me 7.00% APY for one year, insured. Actually, I was wary when I was offered this card. It seemed to me that it was too good to be real (and free). Before signing up I scrutinized closely the terms and conditions, searching for hidden fees or something like this, and reading the reviews on the web. But everything seems clear.

The APY is something I'm very happy about. It's not that much, because the inflation rate this year is going to be about 9%. But earlier I used to earn close to nothing, because none of my other accounts offered me more than 1% per year. (Savings accounts with higher APY work like certificates of deposit and require a high minimum balance, which just doesn't work for me.) In December, when the "7% for a year" offer is closing, I'm going to sign up for a MasterCard with the same features. Thus I will get extra two months of earnings. Maybe using debit cards as savings accounts sounds weird, but it will probably work, at least till the next December.

One nice feature of my new card is that it can be used in online transactions as a perfectly normal Visa Classic. (Electrons can't.) So, I can now shop at Amazon or eBay at last! Honestly, when I found out about this possibility, I felt an immediate desire to splurge. For a long time I was longing to buy some books that I couldn't find anywhere in Moscow, but wasn't able to because I lacked a proper payment method. Now that I have such a means, I still must think twice, because the shipping rates to Russia are something to count with :)

The drawback of this full functionality is a higher risk of fraud. My first two cards are really safe. They have no CCV and cannot be used in internet or phone transactions. That's why even if someone learned my Electrons' numbers, they couldn't do anything harmful. Now I have to be cautious and protect the number, CCV, and expiry date of my new card.

So, my second card goes on holiday. I intend to use it once a month to cash out my stipend, and then I will roll the money on a better card. It seems that I’ve found a good deal.

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