credit card

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credit card,

device used to obtain consumer credit at the time of purchasing an article or service. Credit cards may be issued by a business, such as a department store or an oil company, to make it easier for consumers to buy their products. Alternatively credit cards may be issued by third parties, such as a bank or a financial services company, and used by consumers to purchase goods and services from other companies. There are two types of cards—credit cards and charge cards. Credit cards such as Visa and MasterCard allow the consumer to pay a monthly minimum on their purchases with an interest charge on the unpaid balance. Charge cards, such as some American Express cards, require the consumer to pay for all purchases at the end of the billing period. Consumers may also use bank cards to obtain short-term personal loans (including "cash advances" through automated teller machinesautomated teller machine
(ATM), device used by bank customers to process account transactions. Typically, a user inserts into the ATM a special plastic card that is encoded with information on a magnetic strip or computer chip.
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). Credit card issuers receive revenue from fees paid by stores that accept their cards and by consumers that use the cards, and from interest charged consumers on unpaid balances.

Diners Club became the first credit card company in 1950, when it issued a card allowing members to charge meals at 27 New York City restaurants. In 1958, Bank of America issued the BankAmericard (now Visa), the first bank credit card. In 1965, only 5 million cards were in circulation; by 1996, U.S. consumers had nearly 1.4 billion cards, which they used to charge $991 billion in goods annually.

The growth of credit cards has had an enormous impact on the economy—changing buying habits by making it much easier for consumers to finance purchases and by lowering savings rates (because consumers do not need to save money for larger purchases). Oil companies, car makers, and retailers have also used the cards to market their goods and services, using credit as a way of encouraging consumers to buy. Concern has been voiced over widespread distribution of bank credit cards to consumers who may not be able to pay their bills; costly losses and theft of cards; inaccurate (and damaging) credit records; high interest rates on unpaid balances; and excessive encouragement of consumer debt that has cut savings in the United States. Legislation enacted in 2009 (and effective in 2010) imposed restrictions on credit card companies, including restricting how they could raise interest rates and placing limits on the issuing of cards to persons under 21 years of age, and attempted to make credit card bills clearer and more informative.

Technology advances have facilitated the use of credit cards. Recording and confirming purchases made using credit cards has progressed from taking a mechanical impression of the card on a paper slip to reading a magnetic strip and transmitting the data electronically to replacing the strip with smart cardsmart card,
small device that resembles a credit card but contains an embedded microprocessor to store and process information. Magnetic-stripe cards, which store a very small amount of information (most typically used to identify the owner) and have no processing capability of
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 electronic chip technology which can in some cases be read using radio-frequency identificationradio-frequency identification
(RFID), a technology that uses radio waves to transmit data and uniquely identify an animal, person, or thing. An RFID system typically consists of a tag and a reader.
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. Merchants, who once needed to telephone a bank office for approval, are now connected to banks by modemmodem
[modulator/demodulator], an external device or internal electronic circuitry used to transmit and receive digital data over a communications line normally used for analog signals.
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, so purchases are approved rapidly; on-line shopping on the InternetInternet, the,
international computer network linking together thousands of individual networks at military and government agencies, educational institutions, nonprofit organizations, industrial and financial corporations of all sizes, and commercial enterprises (called gateways
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 is possible with credit card payment. An alternative to credit cards is the debit carddebit card,
card that allows the cost of goods or services that are purchased to be deducted directly from the purchaser's checking account. They can also be used at automated teller machines for withdrawing cash from the user's checking account.
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, which is used to deduct the price of goods and service directly from customers' bank balances, or a mobile payment service, which uses a smartphone app (usually linked to a bank account, debit card, or credit card) to complete a payment.

References in periodicals archive ?
To avail of this promo, card holders simply have to head to the nearest Sun Shop and present a valid ID along with his or her EastWest Bank credit card to subscribe to Sun Plan 499, with a contract of only 18 months.
Past Pulaski Bank credit card sales include $18.8 million for more than $3.7 million of receivables in 1997, $34 million for $6.4 million of receivables in 2002 and $34 million for $5.9 million of receivables in 2005.
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The note was secured by units of participation in a trust securitizing bank credit card receivables.
In a major recommitment to the Bridgeport area, Peoples Bank Credit Card relocated within the city to larger space.
It combines checking, a money-market account, brokerage margin account, and usually a bank credit card.
But when you add the available 10 percent extra cashback (using Yes Bank credit card) and Rs 1,000 Paytm Cash, it might look more appealing.
Al Salam Bank credit card holders can also link their Gulf Air Falconflyer membership to their cards.
The deal will see the transfer of 27,000 Tesco Bank credit card accounts to Avantcard.
Snapdeal HDFC Bank credit card, which was revamped in Dec'16, has rapidly grown to 1.52 lakh users.
All Gulf Bank Credit Card Customers are automatically enrolled in this Dining Cashback campaign and to earn 10% Dining Cashback, customers must pay at restaurants or online food delivery portal using their Gulf Bank Credit Card and make a minimum Dining spends of KD 100 in Kuwait during the campaign period.
BANKING AND CREDIT NEWS-February 9, 2017-Old Point National Bank joins TCM Bank credit card agent program