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Fareeda Usman is a 26-year-old Pakistani expatriate who has never been a credit card holder. Recently, she found one of the myriad credit card offers too attractive to resist and finally applied. But, the application was rejected and Usman is thanking her stars for it.
"I think credit cards can be more of a problem with all the hidden charges," she said.
"It is easy to spend money you don't have but it takes a long time to clear off the debts," she said.
She does not believe that everyday activities become difficult without a credit card. In fact, she has been travelling, staying in hotels and shopping without having felt the need for a credit card.
"I think people always prefer hard cash to any other means of payment," she said.
"It may take longer for you at times, like when you are booking tickets or hotel rooms, but at the end there is always a way to do it," she added.
Having grown up with a businessman father who has unofficially embargoed credit cards in the family, definitely helped Usman's with her resolve not to get a credit card.
Expert talk
Credit cards are like double-edged swords, according to Ajit Karnik, professor of economics at the University of Wollongong in Dubai.
He said: "On the one hand, credit cards are very convenient to use and give consumers purchasing power wherever they go. But not many people are aware of the fact that they may have to pay a large amount of interest, even on the smallest credit balance."
The fact that there is fierce competition between banks to promote credit cards is one of the reasons for their abundance in the UAE.
"In many countries, the credit histories of shoppers are checked whenever they need to buy an apartment or take out a loan, so it is tougher for them to acquire credit cards. This is not the case here," he said.
However, Karnik said although credit makes life much simpler, they still cannot be considered a necessity.
He said: "For most people above a certain income level, credit cards are the norm. The question remains whether they use it wisely."
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