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http://www.usatoday.com/money/perfi/credit/2010-02-08-creditcards08_CV_N.htm

Emily Maddox, 24, of Knoxville, Tenn., is the kind of customer credit card companies covet. She has a good job as an Internet marketing coordinator, and she lives within her means. But she's never had a credit card, and she has no plans to apply for one.
Credit cards, she says, "make me really nervous, and I've never felt comfortable having one."

In a country where the average consumer owns five credit cards, Maddox may seem somewhat quaint, like an Amish farmer who drives a horse-drawn buggy. But proponents of a no-credit-card lifestyle say there's nothing old-fashioned about their choices. And they're convinced that their numbers will grow as consumers become increasingly disenchanted with credit card industry practices.

Louis Rosas-Guyon, 37, a business technology consultant in Miami, says his life has become less stressful since he stopped using credit cards 10 years ago. "My life has gotten substantially easier because I've offloaded 10 to 12 different credit cards that I no longer have to make a payment on."

A decade ago, consumers who didn't want to use credit cards had two choices: carry a lot of cash or write checks and hold up the supermarket line. Today, debit cards blend the discipline of cash with the convenience of plastic and are accepted by most merchants that accept credit cards. In recent years, their popularity has soared.

"There's quietly been a debit card revolution," says best-selling personal finance author Dave Ramsey, who urges fans of his radio and Fox Business TV show to cut up their credit cards. Now that debit cards are broadly accepted, he says, using a credit card "with all its fees and interest rates and traps with customer service is really stupid."

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Tim McFarlin, a consumer bankruptcy attorney in Irvine, Calif., 34, stopped using credit cards eight years ago because he thought the industry's business practices were unfair to consumers. "Any time there's even a hint of a financial issue in the consumer's life, the credit card company will raise the interest rate to the high 20s, or 30%," he says. "They'll do anything they can to make life as difficult as possible."

Some consumer experts say consumers who have sworn off credit cards are misguided. Among the reasons:

If fraudulent charges show up on a credit card bill, the card holder can simply refuse to pay them. Federal law limits credit card holders' liability to $50 of fraudulent charges, and most card issuers have zero-liability policies for victims of identity theft.

Federal laws also limit liability for debit card theft, but resolving the problem is more complicated. Money used with a stolen debit card is immediately drawn from the holder's account, which means the consumer must fight to get the funds reimbursed. In the meantime, outstanding checks could bounce.

It's also more difficult to dispute a defective purchase that has been paid with a debit card. Credit card holders can refuse to pay for the item; debit card holders have to battle for a refund.

"We still live in a credit-dominated society, and even if a person chooses to live on a cash basis, most of us are going to need credit when it comes time to buy a house or a car," says Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling. "This means having a thick credit file and a high credit score, which can only be accomplished by having some degree of credit and treating it responsibly."