History and elements of credit cards.

1. Know Your Credit Cards
JIAN KANG

2. Contents
 What Is a Credit Card?
 A Brief History of Credit Cards
 Elements of a Credit Card
 Benefits and Costs
 Modern Innovations

3. What Is a Credit Card?
 A cashless payment method
 With revolving credit limits
 Issued by financial institutions
 An option to borrow

4. What Is a Credit Card?
Credit card
•Pay with
credits
•Revolving
credit limits
•Signed
Debit card
•Pay with
savings
•Limited to
account
balance
•Signed
Stored-value
card
•Prepaid
•Limited to
account
balance
•Anonymous
Charge
card?

5. What Is a Credit Card? Major Brands
 American Express
 VISA
 MasterCard
 Japan Credit Bureau
 China UnionPay
 Discover/Diners

6. What Is a Credit Card?
Card Levels
Levels VISA MasterCard American Express
(Blue box/Centurion )
Japan
Credit
Bureau
China UnionPay
Top Infinite
Privilege/
BLACK
World Elite Centurion/Black
Infinite World Diamond
Signature/
Palladium
Priority Platinum
Platinum Platinum Platinum Platinum Platinum
Titanium
Gold Gold Gold Gold Gold
Entry Classic Standard Standard/Green Standard Standard

7. Contents
 What Is a Credit Card?
 A Brief History of Credit Cards
 Elements of a Credit Card
 Benefits and Costs
 Modern Innovations

8. A Brief History of Credit Cards
 1950 Diners Club (Frank McNamara, Ralph Schneider)
 1850 American Express (1958 Centurion)
 1958 BankAmericard (1976 VISA)
 1966 Master Charge: The Interbank Card (1979 MasterCard)

9. A Brief History of Credit Cards

10. A Brief History of Credit Cards

11. A Brief History of Credit Cards

12. A Brief History of Credit Cards

13. A Brief History of Credit Cards

14. A Brief History of Credit Cards

15. Contents
 What Is a Credit Card?
 A Brief History of Credit Cards
 Elements of a Credit Card
 Benefits and Costs
 Modern Innovations

16. Elements of a Credit Card

17. Elements of a Credit Card
(Number’s meaning)
 Issuer identification number (IIN)
 Major Industry Identifier (MMI)
 M: Major Industry Identifier
 M + I: Issuer Identification Number
 A: Account number (9-12)
 C: Check digit
https://www.bindb.com/bin-database.html

18. Elements of a Credit Card
(Number’s meaning)
Issuing network IIN ranges Length Validation
American Express 34, 37 15 Luhn algorithm
China UnionPay 62 16-19 Luhn algorithm
Diners Club Carte Blanche 300-305 14 Luhn algorithm
Diners Club International 300-305, 309, 36, 38-39 14 Luhn algorithm
Diners Club United States & Canada 54, 55 16 Luhn algorithm
Discover Card 6011, 622126-622925, 644-649, 65 16 Luhn algorithm
JCB 3528-3589 16 Luhn algorithm
Maestro 500000-509999, 560000-699999 12-19 Luhn algorithm
MasterCard 51-55 16 Luhn algorithm
Visa 4 13, 16 Luhn algorithm
Visa Electron 4026, 417500, 4405, 4508, 4844, 4913, 4917 16 Luhn algorithm

19. Elements of a Credit Card (Card
Security Code)
2nd Code: Sought by merchants for card not present transactions
occurring by mail or fax or over the telephone or Internet.
 China UnionPay – Card Validation Number 2 ("CVN2"), 3
 MasterCard – card validation code ("CVC2"), 3
 Visa – card verification value ("CVV2"), 3
 Discover – card identification number ("CID"), 3
 American Express – "CID" or "unique card code”, 4
1st Code: Encoded on track-2 of the magnetic stripe of the card and
used for card present transactions.
 CVC1 or CVV1,

20. Contents
 What Is a Credit Card?
 A Brief History of Credit Cards
 Elements of a Credit Card
 Benefits and Costs
 Modern Innovations

21. Benefits and Costs
 Sign-Up Bonus: Debit balance, physical gifts
 Rewards: Cash Rebate, points gained
 Grace- Period: Interest free period, Invest your money elsewhere
 Ease of Purchase: Cashless
 Membership: Discounts or access to member-only resources such as
FHR(Fine Hotels & Resorts) or airport lounge (Priority Pass)
 Building a Credit Line
 Emergencies

22. Benefits and Costs
 Interests: 20% up
 Foreign currency conversion fees: 2.5% up
 Dynamic currency conversion fees: 3% up
 Over credit limit fee
 Annual fee

23. Contents
 What Is a Credit Card?
 A Brief History of Credit Cards
 Elements of a Credit Card
 Benefits and Costs
 Modern Innovations

24. Modern Innovations
Offline Payment - Contactless
 American Express: ExpressPay
 VISA: payWave
 MasterCard: PayPass
 China UnionPay: QuickPass

25. Modern Innovations
Offline Payment - EMV
A global standard for inter-operation of integrated circuit cards (IC
cards or "chip cards")
http://www.emvco.com/about_emvco.aspx?id=156
 2002 - Europay, MasterCard and Visa
 2004 - JCB
 2009 - American Express
 2013 - China UnionPay
 2013 - Discover

26. Modern Innovations
Offline Payment – Mobile Payment
 Google Wallet, 2011
 Apple Pay, 2014
 NFC (Near Field
Communication)

27. Modern Innovations
Online Payment(3-D Secure )
 3-D Secure (an XML-based protocol intended to improve online
payment security)
 Developed by Visa, under the name of Verified by Visa.
 Adopted by MasterCard as MasterCard SecureCode,
 Adopted by JCB International as J/Secure.
 Adopted by American Express as SafeKey.

28. Modern Innovations
Online Payment
 Virtual Credit Cards: Supplementary to primary
cards, no physical body
 MasterPass: a simple, convenient, trusted digital
wallet for faster safe shopping at thousands of
online merchants.

29. How to choose?
 Know your needs and the card policies
 Never use cash advance unless there is an emergency
 Be cautious about hidden costs (OCL, FCC and DCC)

30. Questions and Answers
Thank you!