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In this modern
economy, credit card has special demand to the consumers.
It relieves the customers from monotonous bank queue.
Besides, it gives you freedom to use your money when
necessary without tension. Credit card is nothing but a
small rectangular shaped plastic with large facilities.
They are mainly used for payments in the shops. They are
mainly the concern of various banks. It is not necessary
to have money in your account in that moment. Customers
can borrow money from the bank promising to pay it later
with a small amount of interest. The issuer (mainly bank
or sometimes credit union) has a specific allowance for
the customers depending on their usual account balance
throughout the year or social status.
The idea of credit
card is not recent. The idea first saw the daylight in
the year of 1887. It was just a concept then. Later in
1920 the concept came into application in the United
States. It was then used for purchasing fuel by the
automobile owners. After many researches the idea came
to this strong situation.
To make your own
credit card, you have to create an account in the bank
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give you the opportunity to take the
money on debt. Many mega shops now allow their trade on
credit card. After the purchase, the customers pay the
money by entering a personal identification number
normally known as PIN. This does the transactions from
the account of the card holder to the account of the
merchant. A small amount of transaction fees is required.
Recently, some merchants allow verbal agreement through
electronic media i.e. telephone verified by the issuer.
This system is commonly known as CNP. Every month the
credit card holder receives a receipt about the
purchasing over the whole month. Within a due date he
pays the money back with a little interest. If you pay
the money regularly within the dead line you will cost
less as the interest is less. But, if you do not pay
regularly, then the interest goes up. Some card issuers
have the arrangement of deducting money from the account
instance. This will relieve the cardholders from paying
many interests to the issuers.
The facilities of credit card is much
than other payment systems like debit cards. You do not
have to calculate after each purchase as the whole
transaction is given to you after the month. Therefore,
you can call it a short term loan with less interest
than debit cards. On the other hand, it gives you more
security against frauds.
The card holders can borrow about the
half of the money in his account. Therefore, the more
you deposit the more can get as debt from the bank. As
it is a digital banking system, the security level
should be high. The card holder has to be careful about
the credit card that it is safe all the time. The PIN
number should be a secret so that no one
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