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March 26, 2009

How credit card works?

Filed under: Credit Card — Tags: , , , , — admin @ 2:06 pm

Most of us knows what a credit card is and how it looks like. It´s a piece of plastic that will allow you to buy things now, and pay for them later. Most common credit cards are called for Visa, MasterCard and American Express.  The card you are using has the size of 3-1/8” x 2-1/8″.

Credit Cards

Credit Cards

There is the shiny strip on the back side of the credit card that is known as “magstrip” and it is the main thing on your credit card. It contains all the details on the card and the amount of credit that you are entitled to. So, when the person swipe the credit card on the machine, the “magstrip” will read the information of your card and send it to the central tracking system. The central tracking system has all the information on the balance details, country, zip code, card owner etc.

To protect your personal information (on credit cards) from identify theft, there is a computer chip embedded in your card that requires you to identify yourself every time you use the card. You really don´t want somebody else to use your credit card to buy stuff for him/her self, right?

With great power comes great responsibility right? Same thing is applied with credit cards. Credit card is a very useful tool when you are shopping but only if you use it wisely. So, remember…be a smart shopper!

January 1, 2009

Know about Credit Cards

While using Credit Cards offer numerous benefits, one needs to be careful on choosing a credit card and should understand the right way to spend thru it. Improper usage or spending beyond your limit may lead towards debt. Although a credit card offers the advantage of paying the dues in small amount or a minimum payment, the card holder should understand that paying just the minimum amount due would take years to clear off the dues.

Shopping and Safety

Credit Cards are widely used for online purchases or conventional shopping expenses. It eliminates the need of carrying cash which carries the risk of burglary. Even if you lose your credit card, the Credit Card companies offer the convenience of immediately calling them and disable the particular card. You may no longer be liable for purchases made after reporting the loss of card.

Money at the time of need

Credit Cards offer the benefit of withdrawing money from ATM which is of great help when you are outta money. Even If you don’t possess enough money you could still afford to buy your desired products through a credit card and pay money after few days (next billing cycle).

Reward points

Most of the credit cards offer flashy gifts which could be purchased thru the Reward points. When you make a purchase through your credit card, you gain some reward points. Based on the number of reward points you have, you could redeem it to buy gifts offered by your Credit Card Company.

Choosing the Right Credit Card

Choosing the right credit card is a chaotic job for any greenhorn. You need to compare various credit cards offered by different companies. You need to analyze the APR (annual percentage rate), interest free period, Cash Advance facility, Balance Transfer facility etc.

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