Credit cards are a convenient, secure and popular payment option when you're shopping online. They are widely accepted and offer security features such as 24/7 fraud monitoring, zero liability for fraudulent transactions and sometimes even offer extra verification for your purchases.
Some credit cards also offer points and other perks. Here's how to pay by credit card, how to keep your information safe and how they compare to other payment options.
To get started, you need your credit card (or all of the details on it) and your personal and contact details. If you're new to this process or hardly ever use a card for online purchases, follow these steps to make the checkout process as smooth as possible.
Check that the website is secure
Before you submit your credit card details, make sure you're shopping on a safe website. Two security signs to look for: the website URL should start with the letters "https" and should have an image of a small padlock, usually in the top left-hand corner of the address bar.
Select your item/s
Add items to your virtual basket or cart as you shop. Tip: search online for any discount codes or coupons you could use to save money on your purchases.
Go to the checkout
When you're finished shopping and you're ready to pay, click on the bag or trolley icon (often in the top right-hand corner of the web page).
Enter your contact details
You need to provide your name, address, contact telephone number and email address. You may be asked to create an account with the business as part of this process. Some sites also allow you to make purchases as a guest. Either way, you will need to provide all the details highlighted or marked with an asterisk before you can complete the purchase.
Choose your payment method
You will be asked how you want to pay. As well as credit card and debit card options, you may be able to choose from options such as PayPal, Apple Pay, Google Pay or Samsung Pay.
Provide your credit card details
Enter the name on the front of the card, the 16-digit card number, the expiry and the CVC or CVV number.
Confirm the purchase
Check the purchase amount again before clicking the "confirm" option – keeping in mind that shipping costs and other fees may have been added. (Note that any potential credit card fees that your credit card provider charges will only be shown on your credit card account.) Remember not to hit the "confirm" button more than once while you're waiting for the payment confirmation page to load, otherwise you may end up getting charged twice.
Follow the prompts for any extra security measures
If your card has Visa Secure, Mastercard SecureCode or American Express SafeKey as a security feature, you may be asked to enter a password, answer a security question or type in a one-time code that would be sent to your mobile phone before the payment can be completed.
Keep a copy of the payment confirmation
Most online stores will email you a tax invoice. You can also download or print the webpage that shows your payment is confirmed, if you prefer. Either way, these details will help you track your order and make sure the correct amount is charged to your card. You'll also need the proof of your purchase to dispute the transaction if you don't get what you paid for.
How much does it cost to pay by credit card?
Some online stores also apply a card payment fee or surcharge – you'll see this type of fee when you're at the virtual checkout. But fees from your credit card provider will only be shown in your account or on your statement. There are two main ones to look for:
If you're looking for a credit card to use online, here are some of the card types and features that could benefit you:
- No currency conversion fees. If you often make purchases from online merchants that are based overseas, you should consider a credit card that doesn't charge foreign currency conversion fees. These fees are usually between 3% and 5% of the transaction fee and could easily add up. If the currency conversion fee was 3%, a USD$500 purchase could cost you USD$15 from the extra fee. If you shop online regularly, a card with 0% foreign transaction fees could help you save.
- Fraud protection. Most credit cards offer fraud protection guarantees (such as Visa and Mastercard's zero liability policies), which means you won't be liable for any unauthorised transactions made with your card. Terms and conditions usually apply (for example, you may need to report the fraudulent transaction within a specific number of days). Visa, Mastercard and American Express cards also have fraud monitoring systems in place, so you'll usually be notified as soon as a suspicious transaction (such as a purchase from overseas or a large transaction) is made.
- A store card. You could consider using a card that's linked with a specific retailer that you regularly shop with. If you often use your credit card to buy groceries online, you could consider a Coles or Woolworths credit card to earn Flybuys points and Everyday Rewards respectively. If you often shop at David Jones, the David Jones American Express and the David Jones American Express Platinum credit cards also offer rewards and exclusive perks to both online and in-store shoppers. The Kogan Money Black Card is another product that cardholders can use to earn points as they spend and redeem them for purchases at Kogan.com.
- Low or 0% interest fees. If you're planning to make some big-ticket purchases online or think you'll struggle to repay your balance in full each month, you could consider a card that charges a low ongoing interest rate or a promotional 0% on purchases. Currently, you can compare credit cards with 0% on purchases for up to 15 months and the rate revert to the much higher standard purchase rate when the offer ends. Otherwise, you could consider a card with a low ongoing rate between 9% and 15% for the life of the card.
- A rewards card. If you shop online and always pay your credit card balance in full, you could earn points as you spend with a rewards credit card. While most reward or frequent flyer credit cards award 1 point per $1 spent, some offer a higher earn rate on overseas purchases. This could come in handy if you're using your card to shop online with international merchants.
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While most online shopping goes off without a hitch, fraud and cybercrime does exist and can impact your credit card account, as well as debit cards and other payment methods. Credit cards offer a mix of features to help keep your account safe, which can include the following options:
- Fraud-monitoring services. A lot of credit card providers use 24-hour fraud-monitoring services to help detect and report suspicious activity. When something unusual is detected, the credit card provider will contact you to check whether you made the transaction. If a transaction can't be verified, your account may be temporarily blocked while your card provider looks into it.
- Added verification steps. American Express SafeKey, Mastercard SecureCode and Visa Secure are services that help protect your card from unauthorised transactions. They do this by adding another verification step to payments when you're shopping online with a partnered business. Usually, this step will be a one-time code sent to your phone, a password or a security question you've set up with your credit card provider.Not all online stores enable this extra verification step, but when it applies, you'll just be asked to enter the verification details before you pay. This helps stop other people from using your card details because they won't be able to pass the verification step.
- Zero liability policies. A zero liability policy is a type of insurance cover that protects you from paying for fraudulent or unauthorised transactions. This means if your credit card is used by a criminal, the fraudulent transaction (or transactions) will be refunded back to your account, usually after an investigation by your credit card provider.
Zero liability policies are also available on debit cards. But the difference is that if fraud happens on a credit card, it won't affect your bank balance. You also won't have to pay any interest charges associated with fraudulent transactions – if they apply, they'll be refunded along with the original transaction amount once the situation is resolved. If you're the victim of credit card fraud, contact your credit card provider immediately to dispute the transaction.
As well as your credit card's security measures, online payments are processed through secure, encrypted pages that help keep your data safe from cyber criminals. You can also get extra protection by checking your web browser's security settings, downloading antivirus software or using a VPN (Virtual Private Network).
Credit cards, websites and devices all offer different levels of protection when you're shopping online. But you can use these tips everywhere to get even more security.
- Check that the web address starts with HTTPS. This shows the page you're visiting is secured. You should also see a locked padlock. If it's not there, contact the store or read the privacy and security policy to find out what protection is in place.
- Look for contact details and refund/returns policies. Legitimate business websites include details you can use in case there are any issues. Before you buy anything, check for a street address, phone number and details of how to get a refund or return an item. If you can't find this information, don't make a purchase until you're sure the site is safe.
- Use a private, secure Internet connection. While lots of places now offer free, public Wi-Fi, it is less secure than a personal, private connection such as the one you would have at home. According to the Australian Cyber Security Centre, some criminals have even set up public Wi-Fi connections as a way to steal peoples' bank or card details, as well as other personal information.
- Keep track of where you save your card details. Some stores and apps ask if you want to save your credit card details for the next time you shop. Others only work if you save a card (such as Uber Eats or Shopify's Shop Pay). Internet browsers including Google Chrome, Firefox and Safari may also prompt you to save your details. While this can be a convenient option, it also means your card information will be stored by a third-party service and could be compromised if that account is ever hacked. So take note of where you save your card details and check those accounts regularly.
- Go through your transaction history. This will help you spot suspicious activity. You can check your transactions by logging in to your account or going over your monthly credit card statement. If you use a few different cards, you could also consider getting the Finder app to keep track of all your spending in one place.
If you want to pay online without a credit card, below are some of the other payment options you can use:
|Debit card||You can use your debit card to make online purchases at any store that accepts Visa or Mastercard payments. You need to enter the same card details as you would when using a credit card. Note that card payment fees (surcharges), currency conversion fees or other charges sometimes apply for debit cards as well as credit cards, so it's worth checking what costs the shop and your bank will apply before you pay.|
|PayPal||PayPal lets you store your payment details so you can make secure, fast payments without needing to enter your card information at the online checkout. It's free to create an account and shop with PayPal and your details are protected by unique data encryption. PayPal also offers buyer protection options, including refunds if you successfully lodge a dispute against the online retailer. Plus, you can still earn credit card reward points on some cards when you pay through PayPal.|
|Digital wallets||If you have Apple Pay, Google Pay, Samsung Pay or another digital wallet, look for the logo and you'll be able to use it for your online shopping.|
|Buy now pay later||Lots of stores now offer buy now pay later services such as Afterpay, Zip, Openpay and Humm. If you already have a buy now pay later account, selecting that option at the checkout will prompt you to log in and complete the purchase. If you don't have an account but want one, you may be able to sign up as part of the purchase process. You can also find out how buy now pay later compares to using a credit card here.|
|Prepaid cards||If you don't want to use your personal debit card or a credit card, you could consider buying a prepaid charge card that allows you to preload funds on it. These cards are helpful for controlling expenditure, and they may also help reduce impulse purchases.|
|Travel money cards||Similar to a prepaid card, a travel money card lets you preload money onto the card – except in this case, you can load and spend funds in multiple currencies. This can help you avoid foreign transaction fees that your credit or debit card may charge when you're shopping online or travelling overseas.|
|BPAY||BPAY is an easy, free way to pay registered businesses directly from your Australian bank account. It's usually offered by energy, phone, Internet and credit card providers but you can also use BPAY with some online stores too. This Finder guide looks at which online stores accept BPAY and how it works. You can also look for the BPAY logo, search the BPAY website or contact a business directly to see if it's available.|
|Gift cards||Gift cards can be a useful alternative for online shopping with specific retailers, such as iTunes or JB Hi-Fi. Sometimes you can also take advantage of discounts on gift card purchases. You can purchase most gift cards in-store or online but it's worth checking the fine print to make sure you can use them to buy what you want.|
It's easy and safe to pay with a credit card online – and the right one could help you keep your details safe, earn points per $1 spent or save you money on currency conversion fees. So it's worth comparing a few different ones so you can get a credit card that fits with your goals. If you've got a credit card you're happy with, you can also use this calculator to work out repayments that are affordable and help keep interest costs down.
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