As many of us attempt to become less dependent on credit, it remains a good rule of thumb to continue to use a credit card whenever you make certain purchases. Always use a major credit card when booking flights, traveling internationally, or booking with a hotel that takes a deposit.
When Direct Air filed for bankruptcy and ceased operations in March 2012, customers were told to contact their credit card companies to seek reimbursement for tickets purchased that would not be honored. While the company wasn't honoring their obligations, the Fair Credit Billing Act (FCBA) gives consumers a chance to recoup their losses if they used a credit card for purchase. Customers using a debit card were out of luck.
The economic downturn has affected hotels, tour operators, and other travel-related areas of business, and if you venture to countries that have less stability in financial infrastructure, you stand to lose it all if you've traveled using a debit card.
Sources: Consumer Protection, Federal Trade Commission
"Direct Air under fire as it files for bankruptcy," USA Today, March 20, 2012
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