Grade 3 Lesson 4: Credit cards

#Credit #cards are used widely. #Kids see their parents use credit cards daily, and they will often have questions on what credit cards are, why are they used, etc.

At a high level, there are three different methods of payment that are most commonly used -- #debitcards, #cash/#money, and credit cards. The easiest way to understand credit cards is that they are like borrowing money from the #bank on a monthly basis, and this money needs to be paid back to the bank at the end of the month.

The thing about credit cards is that the holder/user pays an #interest over the amount of money that s/he spends if s/he is late to pay this money on time. This interest may become bigger every single time the person is late for the #payment.

The credit card company allows the person to spend a specific amount of money that it actually agreed on from the beginning, and this means that the person will not be able to spend more than this amount in total. This is called the credit card #limit.

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