MiDM

Project

On

Credit Cards
Prepared by.

D.Pradeep Kumar

What is Credit Card?

Any card that may be used repeatedly to borrow money or buy products and services on credit !ormally we "now #redit cards as Plastic money $ A credit card is a way o% payment by usin& the plastic cards which are issued to customers %or their payment #redit cards are di%%erent than the debit cards It is because usin& the %acility o% credit %inance it does not remove or decrease the balance o% the amount o% account holder %rom his account Credit Cards &ives you a smart way to shop, and o%%er you %lexibility and convenience in mana&in& your %inances Credit cards provide a host o% excitin& o%%ers and bene%its such as low interest rates, rewards pro&rams, and a hi&h credit and cash limit

Service providers

And many more.!

Types of Credit Cards

Major India Credit Card Types Following are various types of credit cards available in India: Premium Credit Cards Cash Back Credit Cards old Credit Cards !irline Credit Cards "ilver Credit Cards Business Credit Cards Balance Transfer Credit Cards Co#branded Credit Cards $ow Interest Credit Cards $ifetime Free Credit Cards %ewards

There are 33 various premium credit cards available in India&

Source : annualcreditreport.co.uk

Source : annualcreditreport.co.uk

ender Base 'sage

!s per ICICI B!() !bout 14% of their credit card base of 3.5 Million comprises *omen& This segment constitutes independent career women as well as homemakers from affluent households&+ !s per the survey generally *omen use their cards at rocery and apparel &&while ,en use for Travel -.ntertainment&& /otel and !ir ticket e0penses add about 35% more to credit card spends by men&

80 70 60 50 40 30 20 10 0 Men Women

Source : annualcreditreport.co.uk

 %esults as per the survey done in 1223 The largest year#on#year increase4 of 56&17 was amongst under 158s Source : annualcreditreport.co.uk

Interpreting the information on Credit Card Statements 80% of those surveyed had seen a copy of their credit file at some point. Respondents reported a significant difference in the understanding of the information contained on credit files. ccording to the survey! online credit files are easier to interpret than paper versions.

Source : annualcreditreport.co.uk

Source : annualcreditreport.co.uk

Effect of Credit cards in Business & Companies

! recent study of ",. finances by *arwick Business "chool has shown that business credit cards are the most widely used financing tool for small and medium#si9ed companies& ",.:s spend in e0cess of ;5&<bn on their business credit cards every month4 according to the findings of the study4 which was sponsored by the Bank of .ngland4 the Treasury4 employers: groups and retail banks4 and is the most comprehensive study of ",. financing in the 'nited )ingdom& !n ",. is defined as a company with fewer than 1=2 employees: there are four million such businesses in the ')& The study4 which used a sample of 14=22 companies4 found that == per cent of ",.:s used business credit cards>

'sage of Credit Card

"#ver the last three years! the credit card industry in $ndia has gro%n at a compounded average gro%th rate of over &0%. " 'he usage of credit cards at retail outlets has nearly doubled ( from &0%) &*% t%o years ago to *0%)+0% ) ,irupam Sahay! -P .marketing/! S0$ 1ard. " 1redit cards are typically used for purchases above Rs. 2!000. 0ut no%adays people have started using them for even around Rs. *00 3 4rishnan 5ovindan! head .marketing/! credit cards! $1$1$ 0ank. " 'he departmental store category along %ith fuel and restaurant spending account for the most fre6uent s%ipes. " $n terms of value! 7e%ellery! electronic goods and telecom account for a ma7or chunk . Source :%%%.bi8opedia.bi8

",early 99% $ndian credit cards are inactive: Survey . s on apr :00;/ " s per R0$ there %ere :8.&mn credit cards as on pril :008 .icici/ "<2% $ndians use credit cards for dining: study ":2 million urban $ndian internet users in $ndia "*.; million urban $ndians buy online .:8% of all urban net users/.

Frauds
"ICICI Bank topped the ist of 1redit 1ard =rauds %ith a total of 8!:80 complaints involving Rs 22 crore >?S@ : mnA bet%een pril and @ec of :008. "!SBC came neBt %ith total complaints of :!989 cases involving Rs 9!;0 crore %hile meri"an #$press Cards lost Rs +.09 crore on <0& complaints. 1itibank! incurred a loss of Rs 9.<& crore! @eutsche 0ank loss of Rs :.0; crore and Standard 1hartered 0ank Rs :.&; crore. Sources : rediff.com contentsutra.com cardbhai.com mydigitalfc.com

Source : annualcreditreport.co.uk

Advantages: 'hey allow you to ma"e purchases on credit without carryin& around a lot o% cash 'his allows you a lot o% %lexibility 'hey allow accurate record-"eepin& by consolidatin& purchases into a sin&le statement 'hey allow convenient remote purchasin& - orderin&(shoppin& online or by phone 'hey allow you to pay %or lar&e purchases in small, monthly installments )nder certain circumstances, they allow you to withhold payment %or merchandise which proves de%ective 'hey are cheaper %or short-term borrowin& - interest is only paid on the remainin& debt, not the %ull loan amount Many cards o%%er additional bene%its such as additional insurance cover on purchases, cash bac", air miles and discounts on holidays Disadvantages* +ou may become an impulsive buyer and tend to overspend because o% the ease o% usin& credit cards #ards can encoura&e the purchasin& o% &oods and services you cannot really a%%ord #redit cards are a relatively expensive way o% obtainin& credit i% you don,t use them care%ully, especially because o% the hi&h interest rates and other costs -ost or stolen cards may result in some unwanted expense and inconvenience 'he use o% a lar&e number o% credit cards can &et you even %urther into debt )sin& a credit card, especially remotely, introduces an element o% ris" as the card details may %all into the wron& hands resultin& in %raudulent purchases on the card .raudulent or unauthori/ed char&es may ta"e months to dispute, investi&ate, and resolve

Dos
5& "ign on the card immediately on receipt& 'nsigned cards are invitations for misuse& )eep the card in a prominent place in wallet @ vault& This will help you to notice if any of your cards is missing& ,any times cardholders realise very late that their card is missing& .nsure that the card you got back after the transaction is yours before putting in the wallet& ,any times4 Card ,ember:s cards get e0changed at crowded merchant location like service station @"uper market& )eep all card number4 e0piry date and contact number of the issuing bank at a secure place for ready reference& It has to be kept in a different place than where you normally keep cards& Inform issuing bank immediately if you lose the card or it is stolen from you& !lways follow up with a written intimation& ,emorise PI( and destroy the mailer PI( is an important validation of your identity& The use of PI( along with card is considered as your authentic signature& )eep it secret always& Inform change of address to card issuing bank immediately& Inform postal authorities also about the forwarding address&

Donts
Throw away the e0pired card& !lways cut the card before disposing& This will ensure that the e0pired card cannot be used for counterfeit @ skimming& %eveal your card number @ e0piry date @personal details to outsiders& ?o not reveal personal details and card numbers in response to any suspicious scheme@ caller& This could be a social engineering attack& /and over your card to any one including your friends @ family members& Card is meant for your use only& .ven when you are reAuested to hand it over to authorised bank representative4 always ensure to cut the card into two before handing over& !llow the card to be taken out of your sight in a merchant location& Insist that all verification to be done in your presence&

1&

C&

B&

=&

!ttempt to use your ?ebit Care for internet transaction or Provide your card number details on the internet& ICICI Bank Debit Cards cannot be used for internet transactions& )eep the PI( number written anywhere& ?o not reveal your PI( to any one& ?o not keep the PI( written anywhere especially in the wallet along with the card&

6&

3&

.0pose the card to e0cessive heat @magnetic field& In a simple case4 where the card came into contact with the magnetic lock on the ladies bag4 the data on the magnetic stripe of the card got erased&

Suggestions
Most of the best tips for using a credit card wisely are just common sense. And, really, they all boil down to two basic points:

Dont use a credit card for impulse purchases and !ead your statement every month.

"he second point is the one that trips up most people. #ts surely easier to pay the balance or minimum$or some amount in between$and move on to more interesting things. %ut &eep in mind that errors are fairly common on credit card statements. 'ven if you dont have all of your credit card receipts handy, compare as many as you have to the items listed in your statement to ma&e sure the dates and amounts are right. Also, credit card issuers are heavily regulated. "hey have to publish the changes theyre rema&ing to your account(and they do this in the fine print at the bottom or on the bac& of the monthly statement. Most count on people not reading these notices.

Dont be that person

0ecommendation
i% you are a %ood lover 1 watch movies re&ularly apply 2ota" 'rump #ard %or &eneral purchases apply AB! AM03 3ne #ard %or petrol and excitin& o%%ers apply I#I#I Ban" #ard

Bibio&raphy
Sources used :

rediff.com contentsutra.com cardbhai.com mydigitalfc.com annualcreditreport.co.uk %%%.bi8opedia.bi8 icicibank.com

For more Information : Mail: pradeep&+<&Cgmail.com