Similterra

Payments are made via credit card for bills for purchases made or services availed of. The issuer of the credit card lends money to the consumer or the card holder by meeting the commitment for these bills on their behalf. In turn, the card holder pays the money bank to the lender according to the terms and conditions of the lender with or without interest as agreed by both. Credit card facility allows the card holder to repay the amount in easy installments with an interest towards the loan.

A membership fee is charged either annually or monthly depending on the type of the credit card. It is a certain percentage calculated sometimes on the allowed credit limit.
The issuer of the credit card is benefited if the card holder opts the monthly membership fees as more money is collected than the annual fees.

A fee is charged when the customer makes the payment; late that is after the agreed period for payment without fees.

Most of the credit cards have a limit on the amount of purchase which means the amount allowed for credit. When the person while making purchases exceeds the limit knowingly or unknowingly, is charged with the over limit fees.

When purchase is done in foreign currency, normally three percent of the amount is charged. Only a few credit card issuers do not charge any fee for this kind of a transaction.

While signing up for a credit card, it is very much necessary to go through the fees structure and policies of the card issuer. Due to a stiff competition in the industry, a lot of credit card issuing companies offer rewards and offers to make the consumer buy their card. Credit card issuers encourage the card holder by various incentives such as gift certificates, cash back offer which is based on the purchase made, (normally one percent is given back) frequent flier points for those who pay by credit cards for their air tickets, by encouraging the usage of credit cards.

The most common offer is being low interest credit cards or zero percent credit cards. But, unfortunately it is only for a given period of six months to one year after which the card issuing company charge exorbitant amount as interest. Also there are companies, which intimate the customer on expiry of the low interest period and charge a monthly or yearly fee for doing so.

A credit card with a trailing interest is said to be an unfair cost as to many it is of hidden nature. Card holders are left to their dismay to find out that even after paying their credit in full, they need to pay the interest.

A lot of credit card issuers charge their customers a hidden tax on all transactions made through credit cards, as they need to compensate for the cost of transaction fees. The credit card issuers know that if the consumer knows the cost on transactions and other card services, it will decrease the sales. Thus surcharging and hidden costs are not made known to the consumer.

To get the best credit card deal, one needs to go through the reward schemes, offers made and fees charged very carefully to enjoy the benefit of holding a credit card to the maximum.

If you are looking for a new credit card then obviously 0% interest credit cards hold a lot of appeal for you. Anything at 0% interest nowadays grabs everyone’s attention, for that matter! But as far as these 0% interest credit card offers go, there is a lot of subtle dodging that credit card companies and bank card issuers engage in to ensure you catch the bait.

So just go ahead and admit it. You are hooked. The 0% APR credit cards ad that you just saw in the brochure attached in the morning newspaper has piqued your interest. But seriously … are these 0% interest credit cards for real?

The truth is they are and they are not. There are cards that live up to the promise of a 0% APR credit card, but the truth is that this 0% interest does not last long. It might just be an initial gimmick to get you to subscribe to the card offer and once you’re a cardholder, you have the 0% APR for just a limited time (3 months, 6 months, or if you’re very lucky 12 months) before they start charging you a higher rate of interest. The credit card game is truly an interesting one to watch, but not if you are the suffering player. Read on to know what you can do to make sure you are not the sufferer.

Understanding 0% APR Credit Cards

Yes, 0% APR credit cards do, in fact, hold a lot of enticement. But here is what you must do when you find a 0% APR card that has gotten your attention. Pay attention to the following:

1) How long the no-interest period will last?
2) Can you transfer other balances at the 0% rate?
3) What will the APR be after the introductory period ends?

When you are done assessing these factors, you can properly compare all of the interest credit card options available.

The Luxuries of Owning a 0% APR Credit Card

If you’ve already accumulated a huge debt on your previous credit cards, there’s good news for you. A 0% APR credit card can benefit consumers bad credit histories in a big way, if (and that’s a big if) they can get approved for the card offer itself. That being said, a 0% APR credit offer allows cardholders to drastically cut down the interest being incurred on existing debt while it can also help consolidate debts on other outstanding high APR card balances. There are typically balance transfer fees associated with this type of consolidation, but if your credit is sufficient enough, you might be able to avoid fees altogether.

Pitfalls of 0 Interest Credit Cards

1) Most 0% interest credit cards offer 0% interest or no interest only for a limited amount of time, which varies between 6 to 12 months.

2) If you’re thinking of transferring balances from high interest credit cards, some of these cards might not even allow you to do so during the introductory 0% offer period.

3) Some 0% interest credit cards might also charge very high balance transfer fees.

4) Some of these cards also carry very high penalties for late payments and
automatically switch you to a much higher variable APR after incurring even a single late payment.

5) Some 0% APR credit cards charge a very high interest rate after the introductory (read honeymoon) period.

Yes, the picture is definitely not all rosy, even though you can most definitely save money on interest charges by using 0% interest credit cards judiciously. If cardholders fail to pay off their card balances prior to the introductory offer expiration, if they fail to make payments on time, or generally disregard their credit responsibilities, these credit cards can end up costing consumers significantly more than most will anticipate.

It Just May Be Time To Apply For A Credit Card

Are you deciding whether you should apply for a credit card? Well, to be frank, if you are like most of us, living in the civilized world, the answer to, should I apply for a credit card is, yes. Credit cards have transformed our lives. In fact, credit cards are a contemporary, commercial revolution. No matter, and almost anywhere you go you find ads on TV and websites, in newspapers and stores requesting you to apply for a credit card. Also, if you observe others around you, you will see that most people have credit cards. As a matter of fact, most people have more than one credit card. Nearly every adult and young adult applies for a credit card. So, should you apply for a credit card as well?

You will have to admit, if you think about it, there are a lot of benefits associated with credit cards. Seemingly, the most important benefit a credit card offers is convenience. For most people, convenience is the primary reason they apply for a credit card. Two decades, or more ago, when not many merchants accepted credit cards, that was not true. Today, it is hard to find a merchant who does not accept credit cards. Now, instead of carrying cash on you – which is neither convenient or safe – you may carry a small piece of financially, high powered, plastic instead. Now, you can get an interest free loan until the next monthly billing cycle. Also, you can buy now and pay later – when you are positioned financially to do so. That in itself is a great reason to apply for a credit card. Added to that, some merchants offer interest-free installment payment plans, making it easier for you to make a big purchase today and pay for it in monthly installments. So, as you can see, credit cards work as an instant long term loan as well and not only as a monthly loan. Other reasons to apply for a credit card include free rewards and shopping discounts for using your credit card. This is made possible by the relationship between credit card companies and merchants. For certain, credit cards offer many benefits.

There are a few ways to apply for a credit card. You may choose to apply for a credit card in person, on the Internet or, by phone. Often enough, you will, as such, be approached by sales representatives, whom will ask you to apply for a credit card with their organization. In applying for a credit card, you must fill-in a credit card application form (which is easy to fill-in). When you apply for a credit card and fill-in an application form, you are entering into a formal agreement with the credit card issuer, basically stating you will uphold you side of the agreement, which is to pay your monthly credit card bill, on time. After you have submitted your application, the credit card company makes credibility checks into your financial background and if everything is fine, you receive a credit card.

The process of applying for a credit card is easy, however, you may or may not desire a credit card, it is a matter of personal choice. Still, for most people who don’t have a credit card yet, the recommendation is, for greater financial power, apply for a credit card, today.

Credit Cards in India:

India has came out of self-binding shackles to look “young” again and the enthusiasm shared by the young work force of the country is driving the economy like never-before. In the present day world, no one wants to be bothered by the presence of huge cash in his or her wallet and the Indians are no exceptions. The unprecedented growth in the number of credit card users has stimulated the Indian economy by a significant extent. The arrival of malls, multiplexes, online shopping stores and shopping complexes have contributed to the growth of the use of plastic cards.

It will not be wrong to say that such a scenario in context of the Indian market is not driven by style statement and is driven more by needs. The benefits of plastic money have offered unmatched ways to create an equilibrium and offer an amicable solution when it comes to purchases and the inability to possess or carry cash. The modern day Indian customers find it more easy to make physical payment (credit card payments) rather than carrying too much cash. The introduction of credit card facilities to pay for mobile, electricity, movie tickets and other related transactions have also contributed to the growth of plastic money in the country.

Best credit cards (India):

In context of the Indian market, the leading credit card service providers are ICICI, HDFC, HSBC and Standard Chartered to name a few. These financial institutions have tried their hands on ensuring value-addition while offering customer-friendly credit card deals. The Best credit cards in India are usually meant for specific user group such as women, students and small business owners. These cards are offered to the prospective customers with appealing deals. Statistics have clearly revealed that the number of credit card holders in India are close to 22 million as on January, 2007. It has been also revealed that the increasing consumerism in the country has led to a two-fold increase in the number of credit card transactions from FY 2003-04 to 2005-06. The trends were as favourable as ever in the financial years, FY 2006-07 and 2007-08 and the same is likely to continue in the coming financial years.

Future of credit cards in India:

With high and industry-favourable figures as above, there is no doubt that the rise in number of credit card providers and users have come of age. With these positively-influencing trends expected to continue in the near and far-future, the writing is on the wall. The credit card industry is likely to soar more than any industry segment. To add to that, easy and continuous payments’ structures with each passing day and with every Bank poised to expand its network, the Indian credit card user community is the biggest beneficiary. The intensifying competition prevalent in the present day Indian credit card market has further fuelled the usage of credit cards in the country like never-before. In an aim to overpower the peers and to sustain and prosper themselves, the Banks and financial institutions have started cutting down the interest rates and offering lucrative deals.

Tips for prospective or existing credit card holders:

A prospective or existing credit card holder must observe carefulness while applying or owning a credit card. The terms and conditions of the credit card agreement must be carefully viewed and understood so that a clear insight can be achieved. This will help a credit card holder to make the best use of the plastic money. The credit card repayments must be made before the due date to avoid attraction of late fee, penalty and surcharge. This can also be done to maintain a smooth flow of business transactions and ensuring one’s credit stability and visibility in the plastic money market.

India has a large area and larger diversity. As habits, priorities and attitudes of people living in different parts of India vary greatly,and I am not stereotyping, so does the nature and need for information (and news)vary.

Having traveled widely throughout India, I feel that the most reliable and popular sources of information (or news) are the regional newspapers and magazines (published in vernaculars). These are popular across all classes and most widely circulated in their respective linguistic regions.

Some leading vernacular dailies are:

Malyala Manorama’ (Region: South; State: Kerala; Language: Malayalam)

Anandabazar Patrika’ (Region: East; State: West Bengal; Language: Bengali)

Dainik Jagran’ (Region: North; Language: Hindi)

Eanadu’ (Region: South; State: Andhra Pradesh; Language: Telegu)

Similarly there are numerous vernacular TV channels and websites which provide latest and most reliable information about different parts of the country.

Upper and middle class Indians use English as a second language and therefore often refer to the English dailies, news channels and magazines for information. One good thing, that seems to be common among the leading English dailies, is that they have a good mix of regional and national news. They are also politically more neutral,.

However, I do not believe that good journalism necessarily means total neutrality. If a newspaper takes a more over posture regarding any issue (political or otherwise), then it is actually reflecting the widely accepted stance of its readership, which if a large number, demands the importance of news itself.

Some leading English newspapers are:

The Times of India, Indian Express, The Telegraph, The statesman, The Hindu and The Deccan Herald.

The Financial Express, Economic Times and Business Standard print the latest financial news.

Following are the leading English magazines:

The Frontline, The Outlook, Readers Digest.

Here is a list of leading TV news channels: Doordarshan (English and most vernaculars), Aajtak, NDTV, and Star News.

Rediff.com is a good source of different kind of information, and if you are in the lookout for some sensational stuff then browse Tehelka.com (it has recently gained some infamy after a series of sting operations, but continues to offer hot news stories).

Finally, if you never been to India, and want to know about India, then do not be intimidated with the numerous choices that I just offered. Just search inside ‘wikipedia.org’ and you will find lot of information covering different topics about India, all in one place. I think this is the best portal and it gives more than the introductory info. Thereafter, if your interest demands further research, and since India has a free press, you have plenty of good sources to choose from.

News axiom: If it bleeds, it leads.

This is an absolute no brainer. Of course, the media favors bad news over good news. The reason is simple and stark: Bad news sells.

Given a simple bad news story and a simple good news story and readership surveys will tell you time and time again that the reader/viewer with pick the bad news story first and then, just maybe, will read/view the good news story.

Since news operations are part of a business (one usually seeking profit from its advertising), then the more consumers of your product, the more you can charge for your advertisers and the more advertisers will advertise their products with you. This is a very simple calculus: More readers, more profit. Profit is the name of the game, regardless of what business you are in. IF you don’t make a profit, then what is the use of having a business. Most people don’t operate in their own lives any different. If your job doesn’t pay the bills, you try to find one that will.

I know from my own experience the impact a negative story, well covered, can have on circulation. I was the editor of a small daily newspaper in Texas. Once day we had this horrendous accident on a stretch notorious for such accidents. Our photographer got incredible images of the aftermath and we ran them. Of course, we caught flack from some readers, but the circulation manager the next day told me that single copy rack sales had jumped almost 50 percent in one day. The general manager/publisher was extremely happy and said he wished we could somehow have such an event every day.

So, whether you like it or not, bad news sells and that is the business news outlets (print, broadcast, satellite, cable) are in. This is not a nice altruistic business that is there just to inform people of events surrounding them. No, like all businesses, their purpose is to make money (to pay their staff, to pay their overhead, to buy things and, hopefully, pay dividends to those who invested the capital to bring the business to life).

That is reality. That is the way life is.

A reward credit card and a cash back credit card are often confused by consumers and even used interchangeably by many credit card companies. In reality, these two types of credit cards can actually be quite different. In fact, the way you earn the rewards or cash back can be quite different, as can the method for spending the money, points, or miles you earn from the card. Therefore, it is best to compare cash back credit cards with reward credit cards before applying in order to determine which type is best for you.

Points Versus Cash

The first factor to take under consideration is whether you prefer receiving cash or points to use redeem on certain goods and services. With a cash back credit card, you will periodically receive monetary refunds. A reward credit card, on the other hand, will either provide you with miles for travel discounts or points for use on specific goods and services. For some consumers, the thought of earning cash back is more enticing, while others prefer the fun of spending their points on things they might not otherwise purchase.

Value for Your Buck

Although you might think you would prefer to get cold, hard cash in exchange for your purchases, you need to consider the value trade off. Generally, reward credit cards supply incentives of a higher value than the amount of cash you receive from cash back credit cards. Of course, if you have no use for the items offered by a reward credit card, then these points are worthless to you. If the items are something you could use or something that you want, however, it might be more worthwhile for you to take advantage of reward credit cards.

Staying Organized

One drawback to reward credit cards is the fact that you need to keep track of points in order to make your purchase. With cash back credit cards, the money is either sent to you automatically or is applied directly to your credit card balance. Therefore, it does not require any organization on your part. If you are somebody that lacks strong organizational skills or you simply don’t want to be bothered with keeping track of one more item, reward credit cards may be too much of a hassle for you.

At the same time, some of the best reward credit cards take the paperwork out of the picture for you. For example, reward credit cards that provide you with free gasoline as a reward may simply deduct the cash back reward from your gasoline purchases made with the card. In that way, you don’t have to keep track of your points and redeem them for your reward.

Getting What You Need

Another potential drawback to reward credit cards is the fact that you are restricted on what you can purchase with your reward. Obviously, you can purchase whatever you wish with the money you receive from a cash back credit card. On the other hand, most people are not bothered by this possible drawback because there are so many reward credit cards available that there is generally a reward credit card to suit anyone’s taste.

If you take the time to carefully shop around and to explore all of the options available, you will likely find a reward credit card that is right for you. From vacation savings, to savings on cars, to restaurant discounts, to merchant discounts, to free airline travel, there are unlimited possibilities. In addition, reward credit cards help ensure that you will spend your credit card reward on something fun for yourself – something you deserve for being a smart financial planner.

Knowing when to pay cash and when to use a credit card can save you money, maximize your ability to evaluate your spending habits, an even make you a few extra dollars.

I’m a huge supporter of using a credit card to pay for nearly every purchase as it allows me to earn some interest on my money in the bank, get cash back rewards, and of course protect me against unauthorized purchases. Plus I can review my spending habits on a monthly and yearly basis, cash slips away too easily and is harder to track.

As much as I support responsible consumers using their credit card for everything, a responsible consumer knows that sometimes using cash is the smart thing to do.

This in no one way condones the ramblings of Dave Ramsey by the way, in case you were thinking about him and his ‘cash only’ ways. The article focuses on responsible spending and getting the most out of your money by knowing when to pay cash and when to pay with credit.

If you don’t have credit card debt and consider yourself responsible enough to handle a credit card and pay it off in full each month, use the card for nearly every purchase you make.

But for all of us credit card users, there are a few times when paying cash is a far smarter financial move:

Pay cash whenever a fee is charged to use credit.

Some merchants may charge extra for paying with credit either in the form of a processing fee or simply a higher price. Gas stations sometimes charge a few cents more per gallon for credit card users. Wrong I know, but still something that goes on.

Leave the credit card in your wallet and pay cash for any purchases that require a minimum credit card amount (you’ll end up spending more just to make the minimum) or charge a fee. This practice is actually against Visa and Mastercard merchant terms, but that doesn’t stop some merchants.

If there is a risk of your card number getting stolen.

Sometimes when you pay with a credit card, the card is taken out of your sight by a waiter or employee. While most of these people are honest and hardworking, some are not. If you’ve heard of credit card theft at the place you’ll be paying at or if something doesn’t see right, use cash.

The merchant offers a discount for cash purchases.

Though rare, this does happen from time to time. Merchants avoid processing fees when they take cash, so some may encourage cash purchases by offering slightly lower prices for cash customers.

Close to your limit.

If you are close to your credit card limit you’ll want to switch to cash until the balance is paid off. Otherwise you risk going over your limit and getting hit with higher rates and a big over the limit fee.

You are out with friends and splitting a tab and someone else has already said they are paying with plastic.

It is a hassle to both your friends and the server to use more than one credit/debit card on a bill. Unless you are the only one paying with plastic, pay your part in cash to your friend who is using plastic. This way only one card has to be swiped and you’ve all paid your fair share.

You can’t pay with credit.

Basically cash isn’t secure and it does little to make you any extra money. But sometimes you can’t avoid using cash so always carry a small amount of cash on you just in case you can’t use your credit card.

These are really the only times that cash needs to be used for day to day purchases. Again, if you are a responsible consumer and credit card user you’ll get a lot more out of your credit card by using it for most purchases while being savvy enough to know when to pay in cold hard cash.

If you are facing trouble with a Credit Card which has low credit limit then you may have to opt for a Credit Card with a slightly higher rate of interest. If you have poor credit or no credit, some banks will issue you a secured credit card for which a deposit money in your saving account will serve as guarantee against your credit limit.

Secured Credit Cards are often the most excellent alternative for people facing the bankruptcy in their past. Make sure you select a Credit Card that pays you interest on your deposit. On contrary if you have very good Credit Score and would like a higher limit, you can opt for a Gold or Platinum Card at the same interest rates but with a little
high annual fee.

We do normally receive notices like “we are pre-approved for endless types of Credit Cards. This is a trap actually…

Warning about these “pre approved” Credit Card offers that you get in your mail: You may be receiving offers like a new Credit Card with a pre approved Credit Limit but the terms and conditions could discloses a very high rate of interest and also state that, by accepting the offer you agree to transfer the entire balance of your other Credit Card to the new high interest account. This is a trap, because you would never knowingly choose to pay extra interest. Study the whole thing with awareness so that you don’t fall into this trap.

It doesn’t matter what kind of plan you choose but you must have the following information regarding the Federal Truth in Lending Acts. Following information will help you evaluate Credit Cards with one another.

•Finance charges in dollars and as an annual percentage rate (APR)
•Credit issuer or company giving that the credit limit.
•Size of the credit line
•Duration of the grace period, if any, prior to payment must be made.
•Minimum fee required .
•Annual fee, if applicable.
•Fees for credit insurance (if any) .
Now the Types of Credit Cards
Mainly there are three types of Credit Cards are there
•Master, Visa and Discover Card.
•Travel and Entertainment Cards such as Diners Club and American Express.
•House Cards which are usually used in one chain of stores.
You must be familiar with Affinity Cards; these Cards do carry Master or Visa logo as usual but these Cards give few benefits like Gas Cards, Frequent Flyer Miles plus reward points on each time you use these cards. These Cards help companies put their name before its Customers and establish a brand name and apart from that these companies do receive some financial incentives too from the Credit Card Company.

The right Credit Card for you is the one that’s accepted everywhere you shop and charges you the least amount of money for the services you utilize. Nearly any U.S. business or organization that accepts MasterCard also takes Visa, and vice versa. So if you only do use your Credit Card in the United States, you most likely don’t need both.

“Good morning, Ms.Smith, I’m with ABC Credit Services. I’m calling today because someone used your credit card last night at a Stop-N-Go. Can you please confirm your credit card number for me?” Fraudster Phone Call

The internet is ripe with information on how to avoid credit card scams. But what they won’t tell you is what the people calling will sound like, or what they will say.

First, be aware, that banks will call to confirm your purchasing habits but NOT to confirm your credit card information. There is a distinction. Card companies will already have your credit card numbers. This information will be up on one of several security systems. Second, regardless of who is on the phone, tell the person that you will call your card company to confirm and HANG UP. Dig your credit card or credit card statement out and call the 1-800 number listed. If the customer service agent does not have notes on your account about a call to you, ask to speak with the Fraud Detection Department. These are the people most likely to call you. By law all Credit Card Companies and Banking Systems have Fraud Detection Departments.

So, here are some other things fraudsters may say when they call you:

“Good afternoon, Mr. Smith, I’m with ABC Credit Card Company. We noticed some unusual activity on your card. Can you confirm your credit card is in your possession? To confirm, please read off your last four numbers AND the csc/cvc code on the back.”

“Hello, Ma’am. I’m with your bank. I have your credit card here. Can you confirm the numbers? Why? Because someone found it outside and I want to make sure I’m talking to the right person.”

“Hello, Sir. Your credit card number was used today at my store. I just want to make sure that I got the full number here because it’s not processing all the way. Will you repeat the number for me?”

And, my favorite all time lie is:

“Good Morning Mr. Smith. I’m with ABC Credit Card Company and you’ve just won our Grand Prize! In order to process all the forms we will need your credit card number. May I get that full number, please?”

Also, be ware of the Visa 911 Scam:

“Good Morning Ms. Smith. I’m with Visa 911. I see your credit card is being used in Guam. Please confirm your credit card number for me so we may stop all the charges against it if your card number has been comprimised.”

Visa 911 will NOT call you. Your credit card company will call you if there is an issue with your card.