Sharing Daily Discoveries About Personal Finance And Business Topics

Having Your Credit Card Charged Before An Item Is Ships

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I was reading some comments today where people have been getting charged on their credit cards by a company before the products has actually shipped. The issue as well is that there have been details as to when people would actually be receiving the items other than relying on estimated rumored times. So that brought up topics on how it is bad business practice to do that as many companies only charge your credit card once the product actually ships.

To my surprise the opinion about this isn’t as clear cut as I thought it would be. Many people say that it’s normal to get charged right away as many times people would cancel orders more easily due to not having any funds tied up with an order. So from a business perspective in that case it makes sense. From a consumer perspective of course it doesn’t as it’s almost like you are giving the company an interest free loan of sorts.

It’s kind of interesting to note though that some credit cards have features such as if the merchant didn’t deliver the product in like 14 days then funds would automatically be charged back. So in that sense it would say it’s wrong from a business perspective to take funds before you actually ship out an order. I personally think you lose trust among consumers in many ways by simply charging funds before actually shipping out a product. There are just too many shady businesses out there that would do that just to run away with people’s money as an example.


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