Buying on Credit companies practices in different countries

1. Buying on Credit

2. To purchase
something with the
promise that you
will pay in the
future.
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3. : The fee you pay per year in order to keep your
credit card. Some have no annual fee, while others carry high
fees.
The percentage charged every
year on top of any outstanding payments (amounts left to pay
after the due date).
cash back or travel rewards.
The amount owed on the card.
The smallest amount you can pay toward
your credit balance.
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4. : An asset of value that lenders can take from you if
you don’t repay the loan as promised.
: Lenders will want to know if you have items they can
sell to repay the loan.
: A pattern of rising income and steady employment
gives lenders more confidence in offering you credit.
: Are you trustworthy? They measure that by looking
at your credit record-paying bills on time shows them that you
are responsible with your finances.
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5. • Convenience
• Protection
• Emergencies
• Opportunity to Build
• Quicker Gratification
• Special Offers
• Bonuses
• Interest
• Overspending
• Debt
• Identity Theft Credit
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6. : The creditor’s evaluation of a person’s
willingness and ability to pay debts.
: A history or record of a person’s financial and
credit practices.
: Numerical expression of a person’s credit
worthiness (based on credit report).
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• There's a credit system much like the credit
scoring system in the US.
• 3 major credit agencies, Equifax, Experian,
and Callcredit (Noddle).
• But the system has its differences, too: Getting
on the electoral register to vote (or explaining
why you're not eligible to) can help you
improve your credit in the country

10. • Japan doesn't have an official credit scoring system.
• Credit in Japan is usually between the consumer
and the bank, and is based on factors like length of
employment and salary.
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11. Its main credit agency is SCHUFA, a private
company that operates like the credit data brokers
in the US, tracking open accounts, unpaid bills,
loans, and fines.
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12. In China not paying a debt will hurt your score, but
so can infractions like a poor driving record or
smoking in a non-smoking zone. A low score can
keep a person from getting into good schools,
buying plane and train tickets, and even affects who
they match with on online dating sites.
•
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14. 2. Marketing will likely
be getting more
personalized
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1. Card companies might
have to offer more
personal finance
management tools to
compete
The waste on ad spend for
irrelevant audiences is
slimming down, particularly
in businesses that have high
marketing budgets like credit
card companies.

15. 4. Marketing might
expand to more subprime
customers
3. Direct-mail offers for
cards might decline
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Using more digital marketing
and making the user interface
as easy as possible.

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5. Affiliate and third-
party Referral
marketing could ramp
up
Because consumers are likely to
attach to a credit card provider by
incentivization from brand discounts
and points at major online and local
retailers, affiliate marketing and
collaborative partnerships are the
ways to go.

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6. Long-term benefits
are becoming a higher
priority
• Long-term rewards that put
consumers in a better position to
achieve their financial goals
should be the first priority when
choosing a credit card, whether
the goal is building up savings,
traveling, budgeting or anything
else.
• Flexible rewards (the ability of
consumers to choose what kinds
of rewards they receive)
• Bonus rewards for e-commerce
• Bonus rewards for shopping
locally

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Company
Name
Intro
(Purchases)
Intro
(Transfers)
Regular APR
Annual
Fee
Credit Needed
VISA
0% Intro APR
on Purchases 15
months
N/A
14.99 - 23.74%
Variable
$0 Good/Excellent
Mastercard N/A
0% for 18
months
13.99 - 23.99%
(variable)
$0 Excellent/Good
Citibank N/A
0% for 18
months
13.99 - 23.99%
(variable)
$0 Excellent/Good
Chase
0% Intro APR
on Purchases 15
months
N/A 14.99 - 23.74%
Variable
$0 Good/Excellent
American
Express
N/A N/A N/A $0 Good/Excellent
Capital One N/A N/A
26.99%
(Variable)
$0
Average, Fair,
Limited

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Company
Name
Intro
(Purchases)
Intro
(Transfers)
Regular APR
Annual
Fee
Credit
Needed
Bank of
America
0% Intro APR
for 15 Billing
Cycles
0% Intro APR
for 15 Billing
Cycles (for
balance
transfers
made in the
first 60 days)
13.99 - 23.99%
(Variable)
$0 Excellent/Good
Discover 0% Intro APR N/A N/A N/A bad to excellent
Synchrony
Financial
N/A N/A N/A N/A poor credit
Wells Fargo N/A N/A N/A N/A
good to
excellent
Barclays US N/A N/A N/A N/A fair credit
U.S. Bank N/A N/A N/A N/A
poor to
excellent

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Company
Name
Intro
(Purchases)
Intro
(Transfers)
Regular APR
Annual
Fee
Credit
Needed
USAA N/A N/A N/A N/A fair to excellent
Credit One N/A N/A N/A N/A poor credit
PNC Bank N/A N/A N/A N/A fair credit

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• Visa is a digital payments company
providing transactions between
financial institutions, consumers,
merchants, and banks.
• The company's data processing
operations generate the largest portion
of revenue.
• Visa's strategy is to aggressively expand
its presence in contactless payments, e-
commerce, and other digital vehicles.
• The company is always acquire
developing fintech startup Plaid-
networks allowing individuals to
securely connect financial accounts to
apps.

27. • The key players involved in authorization and settlement
are the cardholder, the merchant (business), the acquiring bank (the
business's bank), the issuing bank (the cardholder's bank), and the
card associations (Visa and MasterCard.).
 So in Iran we can say that the most important players are people who will
use the credit cards and due to these days economic situation, inflation and
people’s poor purchasing power, credit cards will be acceptable for them.
 The next players will be the merchant, Technically, a merchant is any
business that sells goods or services. But, only merchants that accept cards
as a form of payment are pertinent to our explanation. So with that said, a
merchant is any business that maintains a merchant account that enables
them to accept credit or debit cards as payment from customers
(cardholders) for goods or services provided.
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28.  An acquiring bank is a registered member of the card associations (Visa
and MasterCard). An acquiring bank is often referred to as a merchant
bank because they contract with merchants to create and maintain
accounts (called merchant accounts) that allow the business to accept
credit and debit cards. Acquiring banks provide merchants with
equipment and software to accept cards and handle customer service
and other necessary aspects involved in card acceptance. The acquiring
bank also deposits funds from credit card sales into a merchant’s
account.
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29.  As you’ve probably guessed, an issuing bank issues credit cards to
consumers. The issuing bank is also a member of the card associations
(Visa and MasterCard).
Issuing banks pay acquiring banks for purchases that their cardholders make.
It is then the cardholder’s responsibility to repay their issuing bank under the
terms of their credit card agreement.
 Credit card companies aren’t banks and they don’t issue credit cards or
merchant accounts. Instead, they act as a custodian and clearing house for
their respective card brand. They also function as the governing body of a
community of financial institutions, ISOs and MSPs that work together in
association to support credit card processing and electronic payments.
Hence the name, “card associations.”
The primary responsibilities of the Card Association are to govern the
members of their associations, including interchange fees and qualification
guidelines, act as the arbiter between issuing and acquiring banks, maintain
and improve the card network and their brand, and, of course, make a profit.
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A typical Visa/Mastercard transaction involves four parties: the account holder or
consumer, the issuing bank, the merchant, and the merchant’s acquiring bank.
Typically, an account holder uses a Visa/Mastercard branded card to make a purchase
with a merchant. Once the transaction is authorized, the issuer bank pays the cost of
the transaction (less an interchange fee) to the acquirer bank. The account holder is
then charged the cost of the transaction, less a merchant discount. Interchange fees
are key in providing value to merchants who accept Mastercard payment products;
Visa/Mastercard does not generate revenue from these fees. The merchant discount
fee helps to cover costs for the acquirer bank. Visa/Mastercard charges the financial
institutions that issue cards a fee based on gross dollar volume of account holder
activity. The company also earns revenue from switched transaction fees.

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The plastic card transactions typically required POS (Point of Service) machines at
merchant’s locations and this incurred an additional maintenance cost that would be a part
of the MDR. With increasing smartphone penetration, and the proliferation of UPI and
cardless payment mechanisms, the high-upfront cost POS machines will soon be
obsolete. This will pave way for cheaper mobile POS solutions that only require a
smartphone. A simple QR code sticker combined with a mobile app should be good to
replace the conventional POS systems. This has negligible maintenance costs, and aligns
with the zero MDR implementation by the government. Again, that is bad news for
Visa/Mastercard as the expansion of POS for merchants will be limited. Deep pocketed
tech players including Google, Amazon, Paytm have already been accelerating the use of
mobile POS systems and the UPI dominance over plastic card usage. UPI enables the
payments directly from account to account, eliminating the need for owning a credit card.
This is definitely bad news for Visa/Mastercard.

32. Some of the banks in Iran such as Melli Bank and Mellat Bank
these days provide some limited credit cards for their customers,
but AP can have a big role in developing credit cards among all
groups of people by introducing the service to banks so they can
issue cards and contact with merchants to increase the number of
merchants which accept the credit cards service but the most
important point is exchange fee, so if AP start with lower
exchange fees, it can attract more merchants, and in the other side
with giving bonuses (travel, taxi, etc.) to card holders can
encourage them to boost the usage of cards by them, so AP can
benefit by the volume of transactions.
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33. One of the critical factors is the card holder credit score, card
issuers need to provide a system for determining card holders
score so they can manage credit cards levels, and divide them
into groups such as golden, master, etc
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34. Armenush Archuniani
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