Lend a credit card at your own risk
Your son goes to Mexico for a month and needs a good payment method. You think: I give him my credit card, he will not be surprised. But you also immediately wonder if that is actually allowed.
You can lend a credit card at your own risk. According to the conditions, you may not share the pin code of your card with anyone, including family members. But this was of course devised by the lawyer of the credit card company. So that the latter does not have to pay for anything should something go wrong.
In short, the credit card issuer covers himself and says it is not allowed. You will not go to jail if you do, but any financial consequences are for your own account.
Lending is common
Practice looks a bit different. Parents regularly lend their credit card to their son or daughter. If he or she is almost 18 years old, it is not strange at all. Then your child does not yet have his own credit card – that is only possible from 18 – but it is large enough to handle payment methods.
It is important that your son or daughter understand that the card must be blocked immediately if it is lost or stolen. This can be done by calling the credit card company, or by immediately adjusting the settings in the app. Credit card blocking is usually clearly stated.
What can you do better?
However, there are better options than giving your own credit card. Because then you would temporarily not have the card yourself.
Request an extra card
If you have a credit card yourself, you can often request a second copy from the same credit card company or bank for adult family members. Usually it is your partner, but it could also be your child. In principle, the child must be 18 years old for this, but at ING, for example, it can be from 16 – as long as it concerns the extra card.
Know that in this case you are still the main cardholder (the second card is also in your name) and that the expenses made with the second card will be deducted from your spending limit. If you are allowed to spend a maximum of 2,500 USD per month, the expenses of both cards will count.
You also have to pay an annual contribution for the extra card. But with some providers, a second copy is free. This applies to many gold cards and, for example, to all American Express cards.
Request a student card
If your child is 18 years old, he or she can apply for a youth or student credit card. The spending space and therefore also the income requirement for such a card is much lower. However, a student credit card is not always suitable for a long journey. For example, you can only spend 500 USD with it within one month. Only take such a card with you for emergency situations, not as a main payment method.
For student credit cards issued by banks, you usually also have to have a checking account with the bank. This is not the case, for example, with the Visa Card for Young People.
Guarantee a real credit card for your child
For most credit cards you need a fixed monthly income of at least 1,150 USD. Students usually do not reach that lower limit. However, your son or daughter can still request a credit card if you, as a parent, are prepared to act as guarantor. This means that the card issuer may turn to you if a credit card bill is not paid.
The largest credit card issuer in the Netherlands, has a guarantee form on its website that you can fill in as a parent when your child applies for a credit card, for example the well-known Visa World Card.
Please note, applying for a credit card is only possible from the age of 18. What is not possible is as a parent to apply for a credit card and put it in the name of your minor child.
Buy a prepaid credit card
You also have to be 18 for a prepaid credit card. But there are no income requirements for such a card, that is the big advantage. You deposit money that you already own on a prepaid card, there is never any question of borrowing or an advance.
Prepaids are, however, less accepted than real credit cards. For example, you cannot rent a car with it and usually you cannot book a hotel room with it. As a result, such a map is unfortunately not useful for a large trip. Paying in stores is usually possible.
For a trip this card can be extra useful as a budget. There are unfortunately various costs associated with prepaids that a regular credit card does not have. This way you pay for charging, not using it for a long time and canceling the card again.