As markets mature, credit cards tend to replace cash and checks as the most common payment mechanism, thanks to their greater security, convenience, and widespread acceptance.
A credit card is a plastic card with a magnetic strip containing data, and is a financial instrument allowing the holder for pay for goods or services on credit and in lieu of cash. While credit card companies provide the infrastructure to settle the transactions, the cards are issued by banks and increasingly by retail outlets and other consumer-oriented entities.
Credit cards allow customers to buy goods and services immediately and then settle the bill for aggregated transactions at a later date. Debit cards, on the other hand, allow customers to buy using funds directly debited from their accounts.
Visa and Mastercard are the two largest credit card companies worldwide. Both were originally formed by consortia of banks. American Express is both a credit card provider and a bank. JCB is popular in Japan and Diners Club is also a major worldwide provider.
A Quick History of Credit Cards
The concept of credit dates back to the late nineteenth century. This is when symbols of credit started being used by merchants while selling goods without the buyer having the necessary cash in hand. In fact, American lawyer and author Edward Bellamy referred to a 'credit card' in his bestselling novel Looking Backward, which was published in 1888.
According to Encyclopedia Britannica, credit cards began being used in the US during the 1920s, with oil companies, hotel chains and other individual firms issuing these cards to their customers. In the late 1930s, companies that issued credit cards began accepting cards issued by other firms as payment.
The 'Charge-It' card from Flatbush National Bank of New York was the first bank card to be issued in 1946, but it could only be used locally. American Express issued the first national charge card in 1958.
Today, credit cards can be used globally, can involve a number of third parties, can be used for a wide number of purchases and do not require the cardholder to maintain an account with the issuing entity.
How Are Credit Cards Used?
Once a credit card has been issued, the cardholder can make purchases within the prescribed credit limit. Within seconds, the provider of the goods or services can verify the validity of the card electronically. Each credit card has a unique personal identification number (PIN), which is like a password that authenticates the card. Upon making the purchase, the card issuer pays the merchant. At regular intervals, the cardholder receives credit card statements that outline all the purchases for which payments have been made using the credit card. The cardholder makes the payment by the due date to the issuing company. If the cardholder defaults on making a payment, interest is charged on the outstanding amount. Usually the interest rate is fairly high.
Major Credit Card Types and Issuers by Country
US Credit Cards
Types of credit card: Airline Credit Cards, Balance Transfer Cards, Business Credit Cards, Cash Back Credit Cards, Credit Card Specials, Instant Approval Cards, Low Interest Credit Cards, Prepaid and Debit Cards, Reward Credit Cards and Student Credit Cards.
Major issuers: Advanta, Bank of America, Capital One, Discover, First National Bank of Omaha, HSBC Bank, MasterCard, Orchard Bank, Visa, American Express, Chase, First Premier Bank and Citi Credit Cards.
UK Credit Cards
Types of credit card: 0% Balance Transfer Cards, Cash back Cards, 0% Purchase Cards, Long Term / Life Balance Transfer Cards, Virtual Cards, Purchase Cards Low Standard Rate Cards, Business Cards, Low Credit Score Cards, Charge Cards, Loyalty Reward Cards, Charity Cards, Music Cards and Sports Cards.
Major issuers: 360Money, Marks & Spencer Money plc, AA, Nationwide, Bank of Ireland (NI), Orange, Capital One Bank, PayPal, Debenhams, Quidity, easykard, Raphaels Bank, first direct, Saga, GE Capital Bank, Tesco Personal Finance, Halifax Card Services, Ulster Bank (NI), IDT Prime, Vanquis, John Lewis, Yorkshire Bank and Leeds Building Society.
Australia Credit Cards
Types of credit card: Low interest, Rewards Programs, Interest Free, Cash Back, No Annual Fee, Airline Rewards, Balance Transfer and Gold and Platinum credit cards.
Credit card companies: American Express, Diners Club, Visa, Debit Cards and Mastercard.
India Credit Cards
Types of credit card: 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 and Rewards. The Rewards credit cards may be subdivided into Points, Hotels/Travels, Retail, Auto and Fuels cards.
Major issuers: American Express, HSBC, ANZ, Macquarie Bank, Aussie, NAB, BankWest, St George, Bank of Queensland, Suncorp Metway, Citibank, Westpac and Commonwealth Bank. The major credit card providers in India are ABN Amro, HDFC, American Express, ICICI Bank, Axis Bank, SBI, Bank of Baroda, Canara Bank, Citibank, Visa, HSBC, MasterCard, Deutsche Bank, Amex, Barclays Bank, Diners Club, Standard Chartered and Kotak Mahindra.
Singapore Credit Cards
Singapore credit cards are issued by banks as well as non-banking financial institutes. Getting a credit card in Singapore is easy. Difficulty lies in resisting the temptation of acquiring multiple cards since they are available conveniently across this port country.
The banks in Singapore offer Master and Visa cards. The non- banking credit cards include Diners Club, American Express, and JCB cards. Bank credit cards are more easily available from account holding banks. Acquiring credit cards from non-account holding banks is tougher and unnecessary.
Canada Credit Cards
Major Canadian credit cards and credit card issuers include: Best Western Card (MBNA Best Westerb Mastercard Credit Card), BMO Bank Of Montreal Credit Card, BMO Mosaik Mastercard, Canada Credit Cards (Canadian Credit Cards), Canadian Tire Options Mastercard, Capital One Mastercard, Casisses Desjardins Credit Card, CIBC Credit Card Canada (CIBC Visa), Home Trust Credit Card Canada, Hsbc Credit Card Canada, Hsbc Mastercard Canada, ICICI Bank Credit Card Canada, Laurentian Bank Credit Card Canada, National Bank Credit Card Canada, Rbc Royal Bank Credit Card Canada, RBC Visa, Scotiabank Credit Card Canada, TD Card (TD Visa Credit Card Canada), Visa Card Canada, Td Canada Trust Credit Card, Capital One Classic, MBNA Cards Canada
Malaysia Credit Cards
Major Malaysian credit cards and credit card issuers include: Affin Bank Credit Card Malaysia, Alliance Bank Credit Card Malaysia, American Express Credit Card Malaysia, Bank Islam Credit Card Malaysia, Bank Simpanan National Credit Card Malaysia, Citibank Credit Card Malaysia, EON Bank Credit Card Malaysia, Hong Leong Credit Card Malaysia, HSBC Credit Card Malaysia, Malaysia Credit Cards (Credit Cards Malaysia), Mastercard Malaysia (Mastercard Credit Card Malaysia), Maybank Credit Card Malaysia, Public Bank Credit Card Malaysia, RHB Bank Credit Card Malaysia, Standard Chartered Bank Credit Card Malaysia, United Overseas Bank Malaysia (Uob Credit Card Malaysia), Visa Credit Card Malaysia
Pakistan Credit Cards
South Africa Credit Cards
Nigeria Credit Cards
Israel Credit Cards
Vietnam Credit Cards
Iraq Credit Cards
Egypt Credit Card
Ireland Credit Cards
HSBC Credit Card | Master Card | Credit Card Offer | Business Card
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