Presentation on :
Presented to :
Prof. MS Thuran
Presented by :
Also known as plastic money, it is a means of
A credit card is a payment card
issued to users as a system of
payment. It allows the cardholder
to pay for goods and services
based on the holder's promise to
pay for them.
Franz Nesbitum Mc Namara, as American
businessman founded Diner’s Card in 1950.
Barclays Bank in UK introduced in 1966.
Central Bank of India introduced in 1980.
Now many banks issued credit cards.
Three Parties :
1. Issuing organization or bank-agreements
with merchant establishments, makes
payments after deducing commission.
2. Card Holders: Buys goods/services from
establishments without immediate cash
3. Member Establishment: Sends bills to
Eligibility: different card are issued depending on
income of person.
• Standard Card is basic without any frills.
• Gold card/executive card offers higher
line of credit.
• Platinum Card: higher credit limit and
• Titanium Card provides higher credit
Credit Card Changes
Different banks charge differently, depending on
type of card. Main charges are-
• Entry charge- ranging from Rs 100 to 400
• Annual fee- generally from Rs 400 to 1500
and added in bill.
• Supplementary/ add on fee for additional
card from Rs 125 to Rs 1000.
• Cash advance (from ATM) fee- 2.5% per
transaction, with minimum Rs 50 to 100.
• Late payment fee- generally interest.
Advantages of credit cards
For card holders :
Purchase without immediate payment
Overdraft/ credit facility
Security as less cash carried
Freebies and discount facility
For issuing bank :
Source of income
New customers attracted
Reduces number of cheque transactions
Relationship with member establishments
For member establishments :
Payments guaranteed, when charge slip
sent to member establishment.
Speedy settlement of bills by banks
Burden of credit facility taken by bank.
Increase in volume of business transactions.