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 Ever
thought about those little plastic cards that your mom or dad take
out to pay for something you just bought from a store. They are what
is referred to as 'plastic money'. Plastic money comes in the form
of different kinds of cards that companies and banks have to offer
and is becoming increasingly popular. The most popular of these cards
are credit cards.
Credit
cards
Credit
is an arrangement with a bank or company for future payment of a
loan, purchase or service you buy today. Since the bank or the company
paid for you when you used the credit card, you must agree to a
contract to pay them back within a specified time period. You also
have to pay them some interest in the form of extra money for the
same.
A credit
card is a thin plastic card (usually 3-1/8 inches by 2-1/8 inches
in size) with a magnetic stripe behind it containing the cardholder's
identification information. The information on the card is read
for authentication by automated teller machines (ATMs), store readers
or bank and Internet computers.
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| Did
you know? |
| Credit
cards originated in the United States during the 1920s and were
issued by individual companies, such as hotel chains, oil companies
etc. to customers for purchases made at those businesses. |
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A credit
card allows you to buy products and services even if you do not
have the cash in your pocket. Also, credit cards can be helpful
for emergencies requiring immediate payments.
Banks
that issue credit and credit cards charge interest (a percentage
of the amount that you have credited) for the use of the credit.
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| Remember:
If your credit card gets lost then you must report it immediately
to the concerned bank or company that issued it as someone else may
try to use it and you will be charged for it. Reporting the loss of
the credit card will prevent such a thing. |
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| Types
of Credit Cards |
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There are different kinds of credit cards for different purposes.
Each bank has its own rules about credit limits, annual fee, terms
and conditions:
-
Bank cards such as Mastercard or Visa are issued
by individual banks. Such credit cards can be used for purchasing
a variety of goods or availing services. Different banks have
different kinds of credit cards. For example, Citibank offers
cards like the platinum card, gold card, the WWF card etc., each
with its different use and purpose that vary with price.
- Travel
and Entertainment (T&E) cards such as American Express
and Diner's Club are usually used for travel and entertainment
expenses.
- Company
and Retail Store Cards are restricted to purchases at specific
store chains and usually carry no annual fee.
As
most of the banks have started using credit cards, there is a lot
of competition and you may find yourself in a dilemma to choose
the right card. Choosing a credit card is a personal issue but the
right card for you is one that's accepted where you shop and charges
you the smallest amount of money for the services you use. You should
also check for the offers available on the card.
Various
cards offer attractive deals and impressive packages, each with
its own novel features.
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| The
Citibank Junior Card: Teaching kids how to manage money |
| This
year Citibank introduced the Citibank Junior ATM/Debit Card.
This card is a novel attempt by Citibank at teaching kids how
to spend money wisely and inculcating financial discipline in
them. The card caters to such things as payment of school fee,
and things like paying for movie tickets, buying things etc.
The best part about these cards is that parents can pre-set
a monthly control limit on how much their kid can spend with
the card. The card also allows kids to have a sense of financial
freedom and learn to be responsible. The card statement allows
parents and the child to see the details of his spending, a
valuable lesson in money matters! |
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| Did
you know? |
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Citibank
is the world's largest issuer of credit cards with more than
61 million cards in circulation in 36 countries.
The
first universal credit card -- one that could be used at a
variety of stores and businesses -- was introduced by Diners
Club, Inc in 1950.
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| What
the Numbers in your credit card mean |
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Most credit-card systems use the ANSI Standard X4.13-1983
system for their cards
The first digit in your credit-card number signifies the system:
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3 for Travel/Entertainment cards (such as American Express
and Diners Club)
- 4
for Visa
- 5
for MasterCard
-
6 for Discover Card
The
structure of the card number varies by system. For example,
American Express card numbers start with 37; Carte Blanche and Diners
Club with 38. The rest of the numbers indicate the account number,
the card number and a check digit.
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| Authentication |
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There are three basic methods of authentification
Electronic
data capture (EDC) by magstripe-card swipe terminals are
the most common way of verification. This involves swiping your
own card at the checkout.
Voice
authentication using a touch-tone phone.
Virtual
terminals on the Internet
All
these methods are used to check the transaction details such as
Merchant ID
Valid card number, Expiration date, Credit-card limit and Card usage.
The magnetic stripe on the card provides this information, and only
after these details are verified the transaction can be completed.
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| A
bit of Credit Jargon |
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Some important terms one can encounter in credit-card brochures
or discussions with potential lenders:
- Annual
fee is the yearly charge for using the credit card. It is
similar to a membership fee.
- Finance
charge is the amount you pay to use credit or simply put,
the interest rate that you have to pay against your credited amount.
- Grace
period is the time period during which you can pay your credit-card
bill without paying a finance charge. Most banks offer a grace
period.
One
of the best examples of a bank offering a variety of credit cards
is Citibank. A global bank with a wide reach. Committed to offering
comprehensive banking and related services of the highest standards
including home loans, personal loans, durable loans and more.
Already
a reputed name in the field, Citibank wished to make a strong web
presence by building a loyal online community of Citibankers. Since
car loans form a part of Citibank's business activities, the bank
decided to launch a comprehensive, content-rich and highly interactive
automobile portal which would serve as a one-point solution for
finance portals and as a tool for effective marketing.
Various
cards offered by Citibank includes Citibank Platinum Card, Citibank
Diners Club Card, Citibank International Gold Card, Citibank International
Silver Card, MTV Citibank Card, Indian Oil Citibank International
Card, Jet Airways Citibank Card, Citibank Woman's International
Card, International Times Card, Citibank CRY Card, Citibank WWF
Card, Citibank eCard: India's first web credit card, The Citibank
Junior Package: Student smart cards.
For
more details visit:
http://www.online.citibank.co.in/
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