Posts Selected From the Category "Personal Finance"

How much is the joining fee and the annual fee?

Generally, a credit card with a higher annual fee enjoys more benefits like higher credit limit, higher accident insurance cover, accessibility to airport lounges, travel discounts etc. OF at least the used to be the case. With cutthroat competition between the card issuing banks, players are ready to waive joining fees and also one-year membership fees for anyone. Grab these offers, or negotiate this for yourself.

How much is the Add-on card fee?

If you are interested in buying add-on cards for your children, spouse or friend, ask for the add-on card fee. Remember that you will be settling the bills on the add-on card that you so touchingly gift to someone dear to you – the statement will come to you, and the responsibility for payment is yours (as far as the credit card company is concerned)

What is the interest rate?

This is actually a question that you should be asking fairly soon in the discussion. Remember, while the up front one off fees are bread and butter for the credit card Company, this is the jam! If you are the sort who forgets to pay on time, or likes to live it up and live off credit, the interest rate would be of paramount importance.…

The credit card industry in India has registered an encouraging growth in recent times, but the usage pattern of credit cards remains a point of concern, those in the industry say. Seven years back, India had a base of around five lakh credit cards. There has been a seven-fold increase, with the number of cardholders touching over 38 lakh. These figures point towards the fact that the credit card industry in India is growing at a brisk annual rate of 30 per cent and is expected to grow at a similar rate in the coming years. This fortifies the view that conservative purchasing ideas are giving way to the big in-thing. But it is the usability that raises doubts.

According to a survey by the Credit Card & Management Consultancy (CCMC), 71 per cent of first time credit card applicants in the country have expressed the need for advice on appropriate card selection despite the plethora of cards available in the market. Through this survey it has come to realize a long felt need of potential and existing cardholders for advice on suitable selection of a credit cards. The whole idea behind the introduction of the credit cards was to increase the purchasing capacity of the cardholder.…

A plastic card is a thin card that contains identification information such as a signature or picture, and authorizes the card holder to charge purchases or services to the card holder‟s account. Today, the information on the card is read by automated teller machines (ATMs), banks, and the internet.

It all started in the 1920s, when individual companies (such as oil companies and hotels) issued these “plastic cards” for purchases made at their businesses. However, these cards could not be used outside of the company.

In the 1950s a “universal card” was introduced by Diners Club, INC. This was when credit cards were made. These cards allowed the card holders to use the cards in various locations and businesses. The way the cards worked was that there were annual fees, and depending on the plan, the card holders were billed either monthly or yearly.

Later on the “bank credit card system” was introduced. Under this system, the bank credits the account of the merchant at each sale and bills to the card holder at the end of the billing period to account for the sale. The card holder, in turn, pays the bank either the entire balance or in monthly installments with interest.…

The previous (current) financial crisis has severe effects on the business of companies in the credit card business. For a long time, the credit card business has been regarded as one of the most profitable businesses in the financial services industry. MasterCard was one of the most successful companies with its business model differing in one important point from its competitors. Most of the companies in the credit card business issue their cards on their own (including market leader American Express), whereas MasterCard and its main competitor VISA operate through a franchise system which allows its partners (banks) to issue cards of MasterCard. The company is therefore not a direct business partner of cardholders but with the banks which have the right to issue its cards. MasterCard itself states that it is more a franchisor than an issuer of cards. It is therefore not directly exposed to the possibility of defaulting borrowers.

The last 10 to 15 years saw rapid growth rates of revenues of credit card companies. Aggressive advertising which was intended to outline the advantages of payment with credit cards against traditional payment forms like cash and check (especially in the USA) led to big rises in revenues and processed transactions.…