Paying for your shopping appears to be easy. Cash or credit are the common means; and PayPal or Google Checkout are good for on-line shopping. What you need to be concerned are two key factors, namely protection and cost.
Paying by cash does not give you additional protection apart from the goods warranty and the store guarantee. Depending on the issuing bank and type of your card, credit card payments offer some additional coverage on purchase protection and extended warranty. This varies drastically per credit card and you need to read your specific card agreement.
For on-line shopping, PayPal and Google Checkout are indispensable. You can pay without revealing your credit card or bank information, or even your true identify. They offer extra assurance for on-line shopping fraud protections. For instance, PayPal Buyer Protection protects buyers 100% against unauthorized payments with a basic tier coverage of up to $200 USD for items purchased on eBay.com. The vast majority of tangible items sold on eBay.com are eligible for the Top tier protection program with coverage of up to $2,000 USD.
Setting up a PayPal or Google Checkout account is very easy with a credit or debit card.
Cost (Currency-Exchange Fee)
Although it seems easiest to pay by credit card when shopping in the US, you may end up paying a bit more for your purchases unnecessarily. Canadian credit card company will bill you with an exchange rate when the transaction is posted to the credit card system, which may be later than the day of purchase. This depends on how promptly each merchant handles their transactions.
Another less known fact is that a 2.5% fee (called Currency Conversion Fee) for out-of-country purchases is applied to credit cards from TD Canada Trust, RBC, Scotiabank, Bank of Montreal and CIBC. This may not entirely be the fault of your bank. Visa and MasterCard levy 1-percent currency-exchange fees on transactions made abroad.
If you make purchases in US regularly and have a US dollar bank account, it’s well worthwhile to apply for a US dollar credit card. You can control when and at what rate you convert your Canadian dollar. Please see the following page about available US dollar credit cards.