Different Types of Credit Cards Essay

Introduction

In this assignment. I am making a peculiar survey about the different types of recognition cards. A recognition card is a payment card issued to users as a system of payment. It allows the cardholder to pay for goods and services based on the holder’s promise to pay for them. The issuer of the card creates a revolving history and grants a line of recognition to the consumer ( or the user ) from which the user can borrow money for payment to a merchandiser or as a hard currency progress to the user.

A recognition card is different from a charge card: a charge card requires the balance to be paid in full each month. In contrast. recognition cards allow the consumers a go oning balance of debt. capable to involvement being charged. A recognition card besides differs from a hard currency card. which can be used like currency by the proprietor of the card. A recognition card differs from a charge card besides in that a recognition card typically involves a third-party entity that pays the marketer and is reimbursed by the purchaser. whereas a charge card merely defers payment by the purchaser until a ulterior day of the month. The size of most recognition cards is 85. 60 ? 53. 98 millimeter ( 33/8 ? 21/8 in ) . conforming to the ISO/IEC 7810 ID-1 criterion. Recognition cards have an brocaded bank card figure following with the ISO/IEC 7812 totaling criterion.

Recognition cards

Recognition cards now are of assorted types with different fees. involvement rates and honoring plans. When using for a recognition card. it is of import to larn of their diverse types to cognize the one best suited to their life style and fiscal position. Different types of recognition cards available by Bankss and other companies/organizations are briefly described below.

Standard Credit Card:

This is the most normally used. One is allowed to utilize money up to a certain bound. The history holder has to exceed up the sum one time the degree of the balance goes down. An outstanding balance gets a punishment charge.

Premium Credit Card:

This has a much higher bank history and fees. Incentives are offered in this over and above that in a standard card. Credit card holders are offered travel inducements. wages points. cask back and other wagess on the usage of this card. This is besides called the Reward Credit Card. Some illustrations are: air hoses frequent flier recognition card. hard currency back recognition card. car manufacturers’ wagess recognition card. Platinum and Gold. MasterCard and Visa card autumn into this class.

Secured Credit Card:

Peoples without recognition history or with tarnished recognition can avail this card. A security sedimentation is required amounting to the same as the recognition bound. Revolving balance is required harmonizing to the ‘buying and selling’ done. The cardholder of a secured recognition card is still expected to do regular payments. as with a regular recognition card. but should they default on a payment. the card issuer has the option of retrieving the cost of the purchases paid to the merchandisers out of the sedimentation. The advantage of the secured card for an single with negative or no recognition history is that most companies report on a regular basis to the major recognition agency.

This allows constructing a positive recognition history. Although the sedimentation is in the custodies of the recognition card issuer as security in the event of default by the consumer. the sedimentation will non be debited merely for losing one or two payments. Normally the sedimentation is merely used as an beginning when the history is closed. either at the petition of the client or due to terrible delinquency ( 150 to 180 yearss ) . This means that an history which is less than 150 yearss delinquent will go on to accrue involvement and fees. and could ensue in a balance which is much higher than the existent recognition bound on the card.

Limited Purpose Credit Card:

There is restriction to its usage and is to be used merely for peculiar applications. This is used for set uping little credits such as gas credits and recognition at departmental shops. Minimal charges are levied.

Charge Credit Card:

This requires the card holder to do full payment of the balance every month and hence there is no bound to recognition. Because of the disbursement flexibleness. the card holder is expected to hold a higher income degree and high recognition mark. Punishment is incurred if full payment of the balance is non done in clip.

Forte Credit Card:

It is used for concern intents enabling business communities to maintain their concerns minutess individually in a convenient manner. Charge cards and standard cards are available for this. Besides. pupils enrolled in an commissioned 4-year college/university class can avail this benefit.

Prepaid Credit Card:

Here. money is loaded by the card holder on to the card. It is like a debit card except that it is non tied up with a bank history. This is straight connected to nest eggs history. The payments from this card can be made until there is balance in the history. Low Interest Rate Credit Card games: This recognition card is extremely utile as they will hold low involvement rates.

Business Recognition Card games

Recognition cards that are specifically for concern usage merely. They give the privilege for concern proprietors to hold an easy method of maintaining and dividing personal and concern dealing. This recognition card is available for business communities who have big graduated table. little graduated table or medium graduated table concern to look after. This card is extremely utile for easing businessman’s preparation plans. travel and amusement plans.

Gold Credit Card:

Gold recognition cards are made for higher income groups who besides have higher recognition evaluation. It is a position symbol and is considered esteemed. The characteristics of gold recognition cards are: Cash backdown bound is higher

Credit bound is higher

Provides one Add-on card which can be given to either. partner. kids or parents of the recognition card holder Provides many privileges such as travel insurance. wages points. hard currency back offers etc.

Platinum or Titanium Card:
Phosphorus

latinum or Titanium cards are similar to gold recognition cards but they have few more extra benefits. The extra characteristics may differ from bank to bank. Few common characteristics are listed below: Protection against recognition card loss and larceny.

Protection against on-line fraud minutess

Protection against illness and hurt by an accident.
There is no annually fee

Silver Credit Card:

Silver recognition cards are the standard recognition cards available and most of the employed people with 4 or 5 years’ experience can have this type of card. The characteristics of Ag cards are: Lower rank fees

The applicant need non be a high- salaried individual to purchase silver card. The involvement rate is 0 % ab initio between 6-9 months when reassigning history balance from one recognition supplier to another 1. If the recognition history of the card holder is good. the recognition bound provided will be the same as provided to other recognition cards.

There are many other types of recognition cards sold in India. Few are mentioned below:

Wagess Credit Card:

This card has wagess attached to it on based on use of the card. for e. g. A card may offer 5 % price reduction on fuel. if it is used to purchase fuel and gas. or a card may offer hard currency back installation if a certain sum is spent through it.

Balance Transfer Credit Card:

This card is bought to pay outstanding sum of one card with the other. In this excessively there are cards that offer interest-free clip period.

List of recognition cards provided by the assorted Bankss:
Indian Overseas Bank Visa International Credit card
Axis Platinum card
Bank of India’s India Card
Gold International Card
Citibank Dinners Club International card
ICICI Bank Online card
Syndicate Global Gold Credit Card
CorpBank Gold card
Vijaya Bank Visa Gold Credit Card
HSBC Platinum card
CorpBank Classic card
Vijaya Bank VISA Classic International Card
HDFC Silver recognition card

Decision

Here we discussed approximately assorted types recognition cards that utilizing for the simpleness in minutess. Many recognition cards can besides be used in an ATM to retreat money against the recognition bound extended to the card. but many card issuers charge involvement on hard currency progresss before they do so on purchases. Equally good as convenient. accessible recognition. recognition cards offer consumers an easy manner to track disbursals. which is necessary for both monitoring personal outgos and the trailing of work-related disbursals for revenue enhancement and reimbursement intents.

Recognition cards are accepted worldwide. and are available with a big assortment of recognition bounds. refund agreement. and other fringe benefits ( such as insurance protection. wagess strategies in which points earned by buying goods with the card can be redeemed for farther goods and services or cashback ) . Some states. such as the United States. the United Kingdom. and France. limit the sum for which a consumer can be held apt due to deceitful minutess as a consequence of a consumer’s recognition card being lost or stolen.