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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 .
• Normally we know Credit cards as Plastic money...!

• A credit card is a way of payment by using the plastic cards which are
issued to customers for their payment. Credit cards are different than
the debit cards. It is because using the facility of credit finance it
does not remove or decrease the balance of the amount of account
holder from his account.
• Credit Cards gives you a smart way to shop, and offer you flexibility
and convenience in managing your finances.
• Credit cards provide a host of exciting offers and benefits such as low
interest rates, rewards programs, and a high 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
• Gold Credit Cards
• Airline Credit Cards
• Silver Credit Cards
• Business Credit Cards
• Balance Transfer Credit Cards
• Co-branded Credit Cards
• Low Interest Credit Cards
• Lifetime Free Credit Cards
• Rewards

There are 33 various premium credit cards available in India.


Source : annualcreditreport.co.uk
Source : annualcreditreport.co.uk
Gender Base Usage
 As per ICICI BANK About 80
14% of their credit card base
of 3.5 Million comprises 70
Women. This segment
constitutes independent career 60
women as well as homemakers
from affluent households.“ 50

 As per the survey generally 40


Women use their cards at
Grocery and apparel ..while 30
Men use for Travel
&Entertainment.. 20

 Hotel and Air ticket expenses 10


add about 35% more to credit
card spends by men. 0
Men Women
Source : annualcreditreport.co.uk
• Results as per the survey done in 2007
• The largest year-on-year increase, of 16.2% was amongst under
21’s
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. According 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
 A recent study of SME finances by Warwick Business School
has shown that business credit cards are the most widely
used financing tool for small and medium-sized companies.
SME's spend in excess of £1.8bn on their business credit
cards every month, according to the findings of the study,
which was sponsored by the Bank of England, the Treasury,
employers' groups and retail banks, and is the most
comprehensive study of SME financing in the United
Kingdom.

 An SME is defined as a company with fewer than 250


employees: there are four million such businesses in the
UK.

 The study, which used a sample of 2,500 companies, found


that 55 per cent of SME's used business credit cards;
Usage of Credit Card
•Over the last three years, the credit card industry in India has grown at a
compounded average growth rate of over 30%.
• The usage of credit cards at retail outlets has nearly doubled — from 30%-
35% two years ago to 50%-60% - Nirupam Sahay, VP (marketing), SBI
Card.
• Credit cards are typically used for purchases above Rs. 1,000. But
nowadays people have started using them for even around Rs. 500 –
Krishnan Govindan, head (marketing), credit cards, ICICI Bank.
• The departmental store category along with fuel and restaurant spending
account for the most frequent swipes.
• In terms of value, jewellery, electronic goods and telecom account for a
major chunk .

Source :www.bizopedia.biz
•Nearly 44% Indian credit cards are inactive: Survey ( As on apr 2009)

•As per RBI there were 28.3mn credit cards as on April 2008 (icici)

•71% Indians use credit cards for dining: study

•21 million urban Indian internet users in India

•5.9 million urban Indians buy online (28% of all urban net users).

Frauds
•ICICI Bank topped the list of Credit Card Frauds with a total of 8,280 complaints
involving Rs 11 crore [USD 2 mn] between April and Dec of 2008.

•HSBC came next with total complaints of 2,484 cases involving Rs 4,90 crore while
American Express Cards lost Rs 6.04 crore on 703 complaints. Citibank, incurred a
loss of Rs 4.73 crore, Deutsche Bank loss of Rs 2.09 crore and Standard Chartered
Bank Rs 2.39 crore.
Sources :
rediff.com
contentsutra.com
cardbhai.com
mydigitalfc.com
Source : annualcreditreport.co.uk
Advantages:

•They allow you to make purchases on credit without carrying around a lot of cash. This allows
you a lot of flexibility.
•They allow accurate record-keeping by consolidating purchases into a single statement.
•They allow convenient remote purchasing - ordering/shopping online or by phone. They allow
you to pay for large purchases in small, monthly installments.
•Under certain circumstances, they allow you to withhold payment for merchandise which
proves defective.
•They are cheaper for short-term borrowing - interest is only paid on the remaining debt, not
the full loan amount.
•Many cards offer additional benefits such as additional insurance cover on purchases, cash
back, air miles and discounts on holidays.
Disadvantages:
•You may become an impulsive buyer and tend to overspend because of the ease of using
credit cards. Cards can encourage the purchasing of goods and services you cannot really
afford.
•Credit cards are a relatively expensive way of obtaining credit if you don't use them
carefully, especially because of the high interest rates and other costs.
•Lost or stolen cards may result in some unwanted expense and inconvenience.
•The use of a large number of credit cards can get you even further into debt.
•Using a credit card, especially remotely, introduces an element of risk as the card details
may fall into the wrong hands resulting in fraudulent purchases on the card. Fraudulent or
unauthorized charges may take months to dispute, investigate, and resolve.
Do’s Don’ts
Throw away the expired card. Always cut the card before
Sign on the card immediately on receipt.
1. disposing. This will ensure that the expired card cannot
Unsigned cards are invitations for misuse.
be used for counterfeit / skimming.
Keep the card in a prominent place in wallet / Reveal your card number / expiry date /personal details
vault. This will help you to notice if any of to outsiders. Do not reveal personal details and card
2.
your cards is missing. Many times cardholders numbers in response to any suspicious scheme/ caller.
realise very late that their card is missing. This could be a social engineering attack.
Ensure that the card you got back after the Hand over your card to any one including your friends /
transaction is yours before putting in the family members. Card is meant for your use only. Even
3. wallet. Many times, Card Member's cards get when you are requested to hand it over to authorised
exchanged at crowded merchant location like bank representative, always ensure to cut the card into
service station /Super market. two before handing over.
Keep all card number, expiry date and contact Allow the card to be taken out of your sight in a
number of the issuing bank at a secure place merchant location. Insist that all verification to be done
4. for ready reference. It has to be kept in a in your presence.
different place than where you normally keep
cards.
Inform issuing bank immediately if you lose Attempt to use your Debit Care for internet transaction
the card or it is stolen from you. Always follow or Provide your card number details on the internet.
5.
up with a written intimation. ICICI Bank Debit Cards cannot be used for internet
transactions.
Memorise PIN and destroy the mailer PIN is Keep the PIN number written anywhere. Do not reveal
an important validation of your identity. The your PIN to any one. Do not keep the PIN written
6. use of PIN along with card is considered as anywhere especially in the wallet along with the card.
your authentic signature. Keep it secret
always.
Inform change of address to card issuing bank Expose the card to excessive heat /magnetic field. In a
immediately. Inform postal authorities also simple case, where the card came into contact with the
7.
about the forwarding address. magnetic lock on the ladies bag, 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:

• Don’t use a credit card for impulse purchases; and


• Read your statement every month.

The second point is the one that trips up most people. It’s surely easier to pay
the balance or minimum—or some amount in between—and move on to more
interesting things.
But keep in mind that errors are fairly common on credit card statements.
Even if you don’t have all of your credit card receipts handy, compare as many
as you have to the items listed in your statement to make sure the dates
and amounts are right.

Also, credit card issuers are heavily regulated. They have to publish the changes
they’re remaking to your account…and they do this in the fine print at the bottom
or on the back of the monthly statement. Most count on people not reading these
notices.

Don’t be that person


Recommendation

• if you are a food lover & watch movies regularly apply


Kotak Trump Card.

• for general purchases apply ABN AMRO One Card.

• for petrol and exciting offers apply ICICI Bank Card.


Bibiography

Sources used :

rediff.com
contentsutra.com
cardbhai.com
mydigitalfc.com
annualcreditreport.co.uk
www.bizopedia.biz
icicibank.com
For more Information :

Mail: pradeep3673@gmail.com