(July 15th,
2007)
You probably think that's a rhetorical statement
but it's true, credit and debit cards can help in making you
fat. Most Americans know that high calorie fast foods can cause
weight gains pretty quickly, infact 30% of Americans are considered
obese. What's more, when you hop into the nearest McDonalds
and have a bunch of credit cards in your wallet, it's easy to
stick out the plastic to purchase those fries and burgers.
Here
are some statistics about credit cards and fast foods:
» People using credit cards
to buy fast foods spend 30% more than people who pay by
cash.
» More
fast food outlets are accepting credit cards than ever
before. |
Several years ago, fast food outlets accepted
cash only because credit card transactions took too long to
process; this was against the "fast food" concept.
Nowadays, allmost all fast food outlets in the US accept credit
and debit cards. Since they have these convenient pieces of
plastic, they cannot resist the urge to grab something quick.
A study conducted by Visa found that:
» 68% of survey respondents
said paying by Plastic means is faster than cash.
» 77% said they can buy exactly what
they want, because they are not limited by the amount
of cash they have on hand.
» $160 billion was spent in fast food
restaurants in 2006.
» 80% of these transactions were done
in cash.
» Up till March 31st, 2007, the use
of credit cards has grown from 20% to 31%. |
Use of credit cards is growing because new
technologies are enabling customers to NOT have to sign credit
card receipts, and they don't even have to hand over their cards
to the employees. This helps in eliminating credit card fraud.
Jack in the Box restaurants has implemented
a contactless card system in all of its restaurants that allows
customers to hold their cards infront of a reader in the counter
of the drive-through window. AMEX, Visa and MasterCard have
all implemented a similar system. Cason Lane, a Spokeswoman
for Jack in the Box quotes, "Instead of giving the credit
card to the cashier, the consumer retains control of the credit
card the whole time. They just swipe it themselves at the drive-through
window. The feedback to that has been quite positive."
A study conducted by Visa examined 100,000
fast food transactions that found that customers on average
spent 30% more using credit cards than those who paid with cash.
It is likely that if a person had only cash, he would order
a small size burger. But if that same person held a credit card,
he would order a larger size burger with the addition of a high
calorie dessert.
Disadvantages of Using Credit Cards?
i) The group of people at most risk of gaining
weight and gaining lots of debt are youths or college students
who have an average of 3 credit cards in their wallets. They
also owe $890 on average. Since college students live an active
lifestyle, they prefer fast food because it is inexpensive and
saves lots of cooking time. However, 3 credit cards per each
student means they will be making their food purchases on their
credit cards, on top of their tution/books/housing costs. This
could be financially disastrous. They will eventually pay $10
for every $7 burger they buy, due to interest & fees.
ii) Every time you use your credit card to
make a purchase, you are at an increased risk of identity theft
fraud. Cashiers could use other skimming devices to steal your
credit card data, your identity and rack up debt on your card.
iii) Making food purchases on your credit
card can easily eat up your credit line. Catherine Williams,
VP of Financial Literacy department at Money Management International
quotes, "It eats into your credit line. For those who eat
out for lunch every day, spending between $7 and $9 per meal,
that's $45 per week and $180 a month. That would at least chip
away and should you ever need your full credit line, it could
use up some of it."
A precaution to all those buying fast food
on their credit cards: never carry over a balance due from one
month to the other. Williams quotes, "We know that only
one-third of consumers truly pay off in full. Anyone who does
not pay in full should avoid using credit cards at fast food
restaurants at all costs." |
