What are Features of Credit Card?
The 11 of import features of credit card are depicted inwards the icon below.
The head characteristics or features of credit bill of fare are listed every bit follows:
- Alternative to cash.
- Credit limit.
- Aids payment inwards domestic in addition to unusual currency.
- Record keeping of all transactions.
- Regular charges.
- Grace catamenia or grace days.
- Higher fees on cash withdrawals.
- Additional charges for delay inwards payment.
- Service tax.
- Bonus points.
- Gifts in addition to other offers.
Now let's hash out each characteristic of credit bill of fare i yesteryear one.
1. Alternative to cash
Credit bill of fare is a amend option to cash. It removes the worry of carrying diverse currency denominations to pay at the merchandise counters. It is quite slow in addition to agency fast to utilisation a credit bill of fare rather than waiting for completion of cash transactions.
As an alternative, credit bill of fare helps a cardholder to go anywhere inwards the dry reason without a postulate to acquit an ample amount of cash. It also reduces the possible adventure of coin theft in addition to gives its user a consummate peace of mind.
2. Credit limit
The credit cardholder enjoys the facility of a credit boundary assault his card. This boundary of credit is determined yesteryear the credit bill of fare issuing entity (bank or NBFC) alone after analyzing the credit worthiness of the cardholder.
The credit boundary is of 2 types, viz.,
- Normal credit limit, and
- Revolving credit limit.
Normal credit limit is commons credit given yesteryear the banking concern or NBFC at the fourth dimension of issuing a credit card.
Revolving credit limit varies with the fiscal exposure of the credit cardholder.
3. Aids payment inwards domestic in addition to unusual currency
Credit bill of fare aids its cardholder to brand payments inwards whatever currency of choice. In other words, it gives its holder a unique facility to brand payments either inwards domestic (native) currency or if necessary, also inwards unusual (non-native) currency, that likewise every bit in addition to when required.
Credit bill of fare reduces the cumbersome procedure of currency conversion. That is, it removes the fiscal complexities oftentimes encountered inwards converting a domestic currency into a unusual currency. It is because of this feature, a credit cardholder tin sack mayhap brand payments to merchants acquaint inwards whatever corner of the world.
4. Record keeping of all transactions
Credit bill of fare issuing entities similar banks or NBFCs keeps a consummate tape of all transactions made yesteryear their credit cardholders. Such a tape helps these entities to heighten appropriate billing amounts payable yesteryear their cardholders, either on a monthly or about periodic basis.
5. Regular charges
Regular charges are basic routine charges charged yesteryear the credit bill of fare issuing entity on the usage of credit bill of fare yesteryear its cardholder. These charges are nominal inwards nature.
The regular charges are primarily classified into 2 types, viz.,
- Annual charges, and
- Additional charges.
Annual charges are collected on per annum or yearly basis.
Additional charges are collected for other supplementary services provided yesteryear the credit bill of fare issuing entity. Such services include, add-on-card (an additional credit card), number of a novel credit card, etc.
6. Grace period
The grace catamenia is referred to those minimum numbers of additional days inside which a credit cardholder has to pay his credit bill of fare pecker without whatever incurring involvement or fiscal charges.
7. Higher fees on cash withdrawals
Credit-card issuer makes charges on cash withdrawals made through credit bill of fare at the ATM outlets in addition to other desks. Generally, cash withdrawal fees are quite higher than fees charged yesteryear the banking concern or NBFC for the other regular credit transactions. On cash withdrawn done through a credit card, involvement is charged from the same day. That is, involvement is charged since the solar daytime on which cash is withdrawn. Usually, no grace catamenia is provided for cash transactions.
8. Additional charges for delay inwards payment
The credit bill of fare payment is supposed to go made inside a due engagement every bit mentioned on the pecker of a credit card. If payment is non paid on time, in addition to then a credit-card issuer charges about additional costs, which are resulted due to delay inwards payment. These charges are charged to compensate (recover) the involvement cost, management toll in addition to whatever other related costs bared yesteryear the credit bill of fare issuing entity.
9. Service tax
Service tax is included inwards the full amount charged to the credit cardholder. This mandatory service taxation imposed yesteryear the authorities also increases the in conclusion halt toll bared yesteryear a credit cardholder. Many credit bill of fare providers (issuing entities) accept policies of reversing the service taxation charged on the buy of gas, fuel in addition to other similar goods.
10. Bonus points
The contest with the credit bill of fare providers is unbending (adamant). Offering diverse incentives is commonly a trendy (fashionable) agency to improve the sale of the products inwards the ordinary course of report of business. Following this trend, credit bill of fare providers also hand bonus points on the fiscal value of the transactions compiled yesteryear their customers.
11. Gifts in addition to other offers
At a after phase (i.e. after crossing pre-determined number of bonus points) accumulated bonus points are redeemed either yesteryear converting them into gifts, cash dorsum offers, or whatever other similar compelling offers. To collect many bonus points, the credit cardholder has to acquit out a considerable number of transactions through his credit card.
Conclusion on Credit Card
Based on give-and-take made above, nosotros tin sack conclude that,
Credit bill of fare is the termination of comprehensive banking functions.
Credit bill of fare is real convenient fiscal short-term lending facility available to a credit cardholder. However, the security in addition to security of the credit bill of fare are also of prime number importance. These depend on the physical protection of the credit bill of fare every bit good every bit inwards the isolation (confidentiality) of the credit bill of fare number, bill of fare value number (CVV), personal identification number (PIN) in addition to other sensitive credentials of the credit cardholder.
