Taking full credit

Rated by many as one of the phenomenon which changed the world, over the years Credit cards have acquired an indispensable status in today’s world. Credit cards, also referred to as plastic money, altered the ways of the financial world. With credit cards followed convenience and ability to spend money anywhere and anytime around the world. It has played a major part in the growth of shopping, development of Business, ATMs and Internet banking. Credit card is an integral part of mainstream today.

Credit card is a thin plastic card which carries information about the card holder’s name, signature, a set of numbers and the name and logo of the bank and the processor. Upon owning a credit card, a revolving account is created in the name of the card holder from which money can be availed to make payments to merchants at point of sales. One must be clear regarding information related to the interest rate charged by the bank, credit limits of the credit card being used and the credit scores. A series of transactions happens at breakneck pace once the credit card is swiped on the reader. The main parties involved in a credit transaction are: Card holder, Card issuing agent, the merchant, the acquiring bank and an association of card issuing bank. A request for authentication is raised by the merchant to the acquiring bank. After validating the information, the acquirer deducts a fee and submits the information to the issuing bank. The issuing bank allows payment for the transaction to the acquirer after deducting a small fee. The card holder remits the payment to the bank which issued him the credit card upon receiving a bill for the transaction. This is the way a transaction takes place using a credit card.

The market is flooded with a variety of credit cards. Some of the widely used credit cards are Business credit cards, cash advance options, Student credit cards, Prepaid Credit cards, Credit cards for bad credits, Low interest credit cards etc. Loan modification program helps one in credit card debt management and loan handling methods to face several credit issues. Business credit cards come as a boon for entrepreneurs since they come with a higher credit limit or no spending limit. Day to day business activities take place without a hitch as a result. Some even offer rewards and discounts for frequent travel or for boarding the same hotel. Student credit cards come with a lower credit limits and can be helpful to settle sudden expenses. If not used judiciously it can leave one with great financial burden. As the name suggests low interest cards give low interest rates and payments must be made on time to avoid the interest rate from growing. Secured credit cards are issued upon submitting collateral and the credit limit equals the value of the collateral. Major credit card providers are Lloyd’s TSB, Barclays, HSBC, and American Express etc.

Online Credit card is a double edged sword since it brings along different levels of online crimes such as identity theft, compromised accounts, skimming, Phishing and financial burdens to card holders. The card holder must ensure the safety of the credit card. Stolen cards too can be misused. However stronger laws against cyber crimes and credit card frauds and growing awareness have reduced these instances.


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