UK households are being advised to avoid using debit cards for booking holidays, especially for trips planned in the New Year period of 2026. As the festive season approaches, personal finance group Money to the Masses highlights the benefits of using credit cards for large purchases like holidays.
Credit cards offer several advantages over debit cards, including the ability to spread the cost of expensive purchases over time. Typically, credit cards come with a grace period during which you can pay off the balance without incurring interest. Although this may not always apply to very large purchases, 0% purchase credit cards provide an extended interest-free period, allowing you to pay off your holiday expenses over several months without extra costs.
Additionally, consumer protection laws enhance the security of credit card payments. Under Section 75 of the Consumer Credit Act, purchases costing between £100 and £30,000 are protected if the supplier fails to deliver the service, such as in cases where an airline goes bust. This protection is not available for debit card transactions.
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Moneyfactscompare further notes that paying for holidays with certain reward credit cards can also offer perks such as cashback, air miles, or other benefits, adding value to your spending.
Given the potential risks of large upfront payments and the possibility of suppliers becoming insolvent, experts strongly recommend using credit cards over debit cards for holiday bookings. This approach offers greater financial security and flexibility when planning your travel.