Credit cards allow customers to “buy goods now and pay later” – called “buying on credit”. They aren’t linked to a bank account. Like debit cards they can be used to buy goods in shops, over the telephone and internet, with the same details being required. Customers can also get a “cash advance” by drawing money at bank cash machines.

A bank may offer a credit card, or customers can apply for one at any institution offering one. The credit card provider will normally run checks to see if the customer has had any problems repaying debts in the past before offering one (called a “credit check”).