Credit Cards
Content
CREDIT CARDS
Free Powerpoint Templates
Page 1
MEANING AND DEFINITION
Any card that may be used repeatedly to borrow money or buy products and services on credit. Issued by banks, savings and loans, retail stores, and other businesses.
Free Powerpoint Templates
Page 2
FEATURES OF MODERN CREDIT CARD
Owner identification- credit card identifies its owner
as the who is entitled to purchases goods and service without physical money and is eligible for credit from establishments.
Credit limit- The issuer, for the purpose of convenience
and scrutiny, sets up a credit limit for cardholders
Wide usage- Bank credit is the most widely used
payment, device issued by banks.
Technology-dependent- The credit card business is
high volume value business, with the potential to breakeven only beyond a certain volume of cards issued with help of technology leads low cost.
Free Powerpoint Templates Page 3
FACILITIES AND SERVICES OF CREDIT CARDS
Risk coverage: - EX: accident insurance risk coverage(citi Bank) Emergency cash withdrawal: EX:CITI Bank card holder
Withdraw up to 60% of credit limit
Twenty-four hour service: EX:SBI card Help line available 24 hrs
services
Photo card option: Travel privileges: Credit-line increase: Service over phone: Fuel facility: Ex: BP outlets Provides BoB Card Medical advance facility: Supplementary cards: Hotels discount facility: Newsletters: Ex: complimentary subscription to Business world &Today sent to SBI Card Joint credit card and ATM facility:
Free Powerpoint Templates Page 4
TYPES OF CREDIT CARDS
Based on mode of credit recovery
Based on status of credit card
Based on Geographical validity
Bases on the issuer category
Free Powerpoint Templates
Page 5
TYPES OF CEDIT CARDS
Based on model of credit recovery
Revolving credit card: -A Charge card:-
limit is set on the amount of money one can spend on the card for a particular period.
It is a convenient mode of making payment. This facility gives a consolidated bill for a specific period and bills are payable.
Based on status of credit card
Standard card: Business card:
offers only limited privileges to cardholders. Some banks issue standard cards under the brand name “classic” cards. These cards are generally issued to salaried people. also known as “Executive” cards, are issued to small partnership firms, and firms of chartered accountants, tax-consultants and others, for use by executives on their business trips issued in the name of the executives of the firms. The gold card offers high value credit ,It offers many additional benefits and facilities such as higher credit limits, more cash advance limits etc Free Powerpoint Templates Page 6
Gold card:
TYPES OF CEDIT CARDS
Based on Geographical validity
cards that are valid only in India and Nepal are called ‘domestic card’, all transactions will be in rupees. International card: credit cards that have international validity are called ‘international cards’. They are issued to people who travel abroad frequently. Based on Own franchise/tie-up: A bank issues such cards under its own brand. Examples :include SBI card, Cancard of Canara Bank, etc. Master card: The issuing bank has to obtain a franchise from the MasterCard Corporation of USA. The franchised cards will be honored in the MasterCard network. Domestic tie-up card: These are cards issued by a bank having a tie-up with domestic credit brands such as indcard, etc. Ex: IOB Tieup with CANCARD VISA card: type of credit card, which can be issued by any bank having tie-up with VISA InternationalPowerpoint Templates The banks that issue Free Corporation, USA. Page 7 VISA cards are said to have a franchise of VISA International.
Domestic card:
Bases on the issuer category Individual cards: Corporate cards:
INNOVATIVE CARDS
Continued……
ATM card: Debit cards: Hybrid of ATM and Credit card Prepaid cards: They are also called limited purpose prepaid cards Private label cards: These cards are uniquely tied to the
retailer issuing the card and can be used only in that retailer’s stores.
Affinity Group cards:
These are credit cards designed for use by a collection of individuals with some form of common interest or relationship, such as professional, alumni, retired person’s organizations,
Smart cards:
credit card sized plastic card with an embedded computer chip. The telecom industry was perhaps the pioneer in smart cards, the most prominent being Subscriber Identity Module (SIM) cards in the GSM digital cellular network.
Free Powerpoint Templates Page 8
USES OF SMART CARDS
• A smart card can be used for multiple applications. • Gem plus and Schlumberger are the major players in the Smart card market. In India, Bharat petroleum and Indian Postal department have introduced this plan. • Smart cards can be used by government agencies for large data storage such as driving license, vehicle registration and national permit for commercial vehicles, etc. Gujarat and Andhra Pradesh have already introduced this. IDBI’s Bank’s Money Smart card, a stored value card for even small transactions ,and Bharat Petroleum’s pre-paid petrocard are some of the examples of Smart cards.
Free Powerpoint Templates Page 9
Other applications of smart cards
• • • • • Public telephone e-Commerce Cable TV Internet banking Transportation this card can be used in different modes of transport. • In health care, a patient’s blood pressure, sugar, blood group and other vital data could be obtained. • Miscellaneous, such as insurance, club subscription and school fees, etc.
Free Powerpoint Templates Page 10
Difference between Credit Vs Debit Cards
Credit Cards 1 It is issued by an agency such as Master or Visa 2. A credit card allows certain period for making payment ,which may vary from 30 to 45 days. 3. The credit worthiness of the customer is based on which the credit card is issued. 4. A credit card holder has a ceiling limit for his purchases and also for his cash withdrawals through ATM. 5. Credit card can be used for withdrawing money only from ATMs. 6. Loss of credit card should be reported to the issuing agency. Debit Cards 1. A debit card is issued by a bank in which the customer has an account. 2. The bank account in a debit card is debited immediately the moment the card is used. 3. There is no such income criteria 4. A debit card holder has his purchases restricted to his credit balance. 5. A debit card can be used even for withdrawing money from the bank and hence it is account holders’ mobile fund transfer 6. Loss of debit card should be reported to The issuing bank.
Page 11
Free Powerpoint Templates
BENEFITS OF CREDIT CARDS
Benefits to Customer:
• A customer can make purchases at any time • one need not carry cash for making purchases • In case of losing credit card, one can immediately inform the bank and prevent misuse by others • During inflation period, credit card benefits customers as the payments are made after one month from the date of purchase. • Railway ticket or Air ticket reservation can be done by using credit card • Credit card can be used even through computers and purchases can be made by sitting at home. • More customers will come forward to avail banking facility • Credit card can be used even for withdrawing cash through ATM (Automatic Teller Machine) up to a certain limit. • The holders of credit card are given insurance cover by the Free Powerpoint Templates Page 12 banks.
Benefits To Seller
• With increasing sales, the turnover of the seller increases. • Due to credit card facility, he can attract customers from far off places also. • Durable goods can be sold easily through credit card. • Bad debts can be avoided as the bank arranges for payment under credit card.
Free Powerpoint Templates
Page 13
Benefits to Wholesaler
• The wholesaler will be getting more orders from the retailer as the sales will go up due to credit card. • The wholesaler will be dealing products of different manufacturers due to credit extended by them • The wholesaler will be able to place orders throughout the year and hence can get trade credit as well as cash credit from the manufacturers.
Free Powerpoint Templates Page 14
Benefits TO Manufacturer
• With orders continuously received from the wholesalers, the manufacturer can increase his production. • Due to large scale production, the cost of production will come down and the manufacturer will be able to sell at a lower price. • Since the orders are received throughout the year, there will be continuous production. • The manufacturer will also diversify his production due to the goodwill he has enjoyed due to increased production. • The profit of the manufacturer will also increase and he will extend a higher commission to his wholesalers.
Free Powerpoint Templates Page 15
BENEFITS TO COMMERCIAL BANKS • More customers will avail the banking facility. • There will not be cash withdrawals from the bank. • The bank, by extending credit to customer, retailer, wholesaler and manufacturer is able to earn interest on the credit. • All the transactions in the country are done through the banking system, as a result of which, the role of money lenders and other financiers is reduced. • The profit of the bank will also increase due to the extension of credit to different parties.
Free Powerpoint Templates
Page 16
Benefits to Central bank
A better control on the banking system is evolved by the RBI. Central bank is able to take immediate action on the economy as credit card provides information regarding purchases and sale in the country. By extending credit card facility to agriculturists, agricultural finance is improved and this relieves the farmers from the clutches of money lenders.
Free Powerpoint Templates
Page 17
Benefits To the Government
• Whenever any sale is made, it is properly billed. That means sales tax; commercial tax due to the government will not be evaded(avoided). • It prevents the growth of unaccounted money as all transactions are recorded. • It improves the revenue of the government due to increase in production by the manufacturers. Excise duty will be paid to the government. • Government employees can also avail credit card facility against their salaries.
Free Powerpoint Templates
Page 18
Free Powerpoint Templates
Page 1
MEANING AND DEFINITION
Any card that may be used repeatedly to borrow money or buy products and services on credit. Issued by banks, savings and loans, retail stores, and other businesses.
Free Powerpoint Templates
Page 2
FEATURES OF MODERN CREDIT CARD
Owner identification- credit card identifies its owner
as the who is entitled to purchases goods and service without physical money and is eligible for credit from establishments.
Credit limit- The issuer, for the purpose of convenience
and scrutiny, sets up a credit limit for cardholders
Wide usage- Bank credit is the most widely used
payment, device issued by banks.
Technology-dependent- The credit card business is
high volume value business, with the potential to breakeven only beyond a certain volume of cards issued with help of technology leads low cost.
Free Powerpoint Templates Page 3
FACILITIES AND SERVICES OF CREDIT CARDS
Risk coverage: - EX: accident insurance risk coverage(citi Bank) Emergency cash withdrawal: EX:CITI Bank card holder
Withdraw up to 60% of credit limit
Twenty-four hour service: EX:SBI card Help line available 24 hrs
services
Photo card option: Travel privileges: Credit-line increase: Service over phone: Fuel facility: Ex: BP outlets Provides BoB Card Medical advance facility: Supplementary cards: Hotels discount facility: Newsletters: Ex: complimentary subscription to Business world &Today sent to SBI Card Joint credit card and ATM facility:
Free Powerpoint Templates Page 4
TYPES OF CREDIT CARDS
Based on mode of credit recovery
Based on status of credit card
Based on Geographical validity
Bases on the issuer category
Free Powerpoint Templates
Page 5
TYPES OF CEDIT CARDS
Based on model of credit recovery
Revolving credit card: -A Charge card:-
limit is set on the amount of money one can spend on the card for a particular period.
It is a convenient mode of making payment. This facility gives a consolidated bill for a specific period and bills are payable.
Based on status of credit card
Standard card: Business card:
offers only limited privileges to cardholders. Some banks issue standard cards under the brand name “classic” cards. These cards are generally issued to salaried people. also known as “Executive” cards, are issued to small partnership firms, and firms of chartered accountants, tax-consultants and others, for use by executives on their business trips issued in the name of the executives of the firms. The gold card offers high value credit ,It offers many additional benefits and facilities such as higher credit limits, more cash advance limits etc Free Powerpoint Templates Page 6
Gold card:
TYPES OF CEDIT CARDS
Based on Geographical validity
cards that are valid only in India and Nepal are called ‘domestic card’, all transactions will be in rupees. International card: credit cards that have international validity are called ‘international cards’. They are issued to people who travel abroad frequently. Based on Own franchise/tie-up: A bank issues such cards under its own brand. Examples :include SBI card, Cancard of Canara Bank, etc. Master card: The issuing bank has to obtain a franchise from the MasterCard Corporation of USA. The franchised cards will be honored in the MasterCard network. Domestic tie-up card: These are cards issued by a bank having a tie-up with domestic credit brands such as indcard, etc. Ex: IOB Tieup with CANCARD VISA card: type of credit card, which can be issued by any bank having tie-up with VISA InternationalPowerpoint Templates The banks that issue Free Corporation, USA. Page 7 VISA cards are said to have a franchise of VISA International.
Domestic card:
Bases on the issuer category Individual cards: Corporate cards:
INNOVATIVE CARDS
Continued……
ATM card: Debit cards: Hybrid of ATM and Credit card Prepaid cards: They are also called limited purpose prepaid cards Private label cards: These cards are uniquely tied to the
retailer issuing the card and can be used only in that retailer’s stores.
Affinity Group cards:
These are credit cards designed for use by a collection of individuals with some form of common interest or relationship, such as professional, alumni, retired person’s organizations,
Smart cards:
credit card sized plastic card with an embedded computer chip. The telecom industry was perhaps the pioneer in smart cards, the most prominent being Subscriber Identity Module (SIM) cards in the GSM digital cellular network.
Free Powerpoint Templates Page 8
USES OF SMART CARDS
• A smart card can be used for multiple applications. • Gem plus and Schlumberger are the major players in the Smart card market. In India, Bharat petroleum and Indian Postal department have introduced this plan. • Smart cards can be used by government agencies for large data storage such as driving license, vehicle registration and national permit for commercial vehicles, etc. Gujarat and Andhra Pradesh have already introduced this. IDBI’s Bank’s Money Smart card, a stored value card for even small transactions ,and Bharat Petroleum’s pre-paid petrocard are some of the examples of Smart cards.
Free Powerpoint Templates Page 9
Other applications of smart cards
• • • • • Public telephone e-Commerce Cable TV Internet banking Transportation this card can be used in different modes of transport. • In health care, a patient’s blood pressure, sugar, blood group and other vital data could be obtained. • Miscellaneous, such as insurance, club subscription and school fees, etc.
Free Powerpoint Templates Page 10
Difference between Credit Vs Debit Cards
Credit Cards 1 It is issued by an agency such as Master or Visa 2. A credit card allows certain period for making payment ,which may vary from 30 to 45 days. 3. The credit worthiness of the customer is based on which the credit card is issued. 4. A credit card holder has a ceiling limit for his purchases and also for his cash withdrawals through ATM. 5. Credit card can be used for withdrawing money only from ATMs. 6. Loss of credit card should be reported to the issuing agency. Debit Cards 1. A debit card is issued by a bank in which the customer has an account. 2. The bank account in a debit card is debited immediately the moment the card is used. 3. There is no such income criteria 4. A debit card holder has his purchases restricted to his credit balance. 5. A debit card can be used even for withdrawing money from the bank and hence it is account holders’ mobile fund transfer 6. Loss of debit card should be reported to The issuing bank.
Page 11
Free Powerpoint Templates
BENEFITS OF CREDIT CARDS
Benefits to Customer:
• A customer can make purchases at any time • one need not carry cash for making purchases • In case of losing credit card, one can immediately inform the bank and prevent misuse by others • During inflation period, credit card benefits customers as the payments are made after one month from the date of purchase. • Railway ticket or Air ticket reservation can be done by using credit card • Credit card can be used even through computers and purchases can be made by sitting at home. • More customers will come forward to avail banking facility • Credit card can be used even for withdrawing cash through ATM (Automatic Teller Machine) up to a certain limit. • The holders of credit card are given insurance cover by the Free Powerpoint Templates Page 12 banks.
Benefits To Seller
• With increasing sales, the turnover of the seller increases. • Due to credit card facility, he can attract customers from far off places also. • Durable goods can be sold easily through credit card. • Bad debts can be avoided as the bank arranges for payment under credit card.
Free Powerpoint Templates
Page 13
Benefits to Wholesaler
• The wholesaler will be getting more orders from the retailer as the sales will go up due to credit card. • The wholesaler will be dealing products of different manufacturers due to credit extended by them • The wholesaler will be able to place orders throughout the year and hence can get trade credit as well as cash credit from the manufacturers.
Free Powerpoint Templates Page 14
Benefits TO Manufacturer
• With orders continuously received from the wholesalers, the manufacturer can increase his production. • Due to large scale production, the cost of production will come down and the manufacturer will be able to sell at a lower price. • Since the orders are received throughout the year, there will be continuous production. • The manufacturer will also diversify his production due to the goodwill he has enjoyed due to increased production. • The profit of the manufacturer will also increase and he will extend a higher commission to his wholesalers.
Free Powerpoint Templates Page 15
BENEFITS TO COMMERCIAL BANKS • More customers will avail the banking facility. • There will not be cash withdrawals from the bank. • The bank, by extending credit to customer, retailer, wholesaler and manufacturer is able to earn interest on the credit. • All the transactions in the country are done through the banking system, as a result of which, the role of money lenders and other financiers is reduced. • The profit of the bank will also increase due to the extension of credit to different parties.
Free Powerpoint Templates
Page 16
Benefits to Central bank
A better control on the banking system is evolved by the RBI. Central bank is able to take immediate action on the economy as credit card provides information regarding purchases and sale in the country. By extending credit card facility to agriculturists, agricultural finance is improved and this relieves the farmers from the clutches of money lenders.
Free Powerpoint Templates
Page 17
Benefits To the Government
• Whenever any sale is made, it is properly billed. That means sales tax; commercial tax due to the government will not be evaded(avoided). • It prevents the growth of unaccounted money as all transactions are recorded. • It improves the revenue of the government due to increase in production by the manufacturers. Excise duty will be paid to the government. • Government employees can also avail credit card facility against their salaries.
Free Powerpoint Templates
Page 18
