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FAQs OF CARDS ?

  1. What are credit, charge and debit cards?
    A credit card allows you to pay 20-50 days after you make a purchase. You can then pay in full or stagger payment. A charge card, while similar to a credit card, does not allow you to carry over any balance beyond the due date. A debit card does not give you any credit; it is more like a mobile bank account where the purchase amount is instantaneously debited from your bank account.
  2. How many types of credit cards are there in INDIA?
    Whoever the issuer, there are only three basic types of cards now available in India-VISA, MASTER CARD and AMEX.
  3. What is the difference between GOLD, SILVER and EXECUTIVE cards?
    These terms identify the level of service offered. The premium GOLD cards come with higher insurance cover, and more privileges and discounts. Naturally, they also have the highest fees and services charges.
  4. What are the advantages of having a credit card?
    Besides not having to carrying cash, you can issue cheques against your card limits and order demand drafts over the telephone. You also get benefits such as discounts at certain establishments and on insurance premia. Moreover, with a global card, you can spend in any currency and settle your dues in rupees, subject to RBI guidelines.
  5. How do I get a credit card?
    Once you have submitted your application form, along with the documents required (usually some proof of income), the credit company does a creditworthiness check on you. If you meet their requirements, the card is usually with you in four to six weeks.
  6. How is creditworthiness evaluated?
    Card issuers look for regular income, as well as a minimum income. The figure varies across players and card types, ranging from Rs.70000 per annum to Rs. 200000 per annum.
  7. How much does a credit card cost?
    Typical entrance fees (one time payment) vary between Rs. 100and Rs.1000, but issuers often waive this. There is also an annual fee ranging between Rs 200 and Rs.4000.
  8. What are the reward points?
    Reward points are meant to encourage frequent usage. For example, you get one point for every Rs.100 spent on a CITIBANK card or Rs.125 on a STANCHART card. These points can be redeemed for select product purchases or even to pay the annual fees.
  9. What if I lose the card?
    Inform the bank immediately. You are not liable for any purchases made the moment you report your loss, but you will have to pay for all purchases made before that. Your liability is usually restricted to Rs.1000 after the loss is reported, and you also have to pay for a replacement card.
  10. What about the insurance cover?
    Credit card holders are given life insurance cover at reduced premia. Most cards also offer cover on articles purchased on the card, and on baggage lost in transit. The kind of credit card determines the amount and the type of cover. Gold cards typically carry the highest insurance cover.
  11. What is a supplementary or add-on card?
    You can take additional cards for family members, paying Rs.150 to Rs.800 extra. This does not extend your credit limit but allows both cards to be used for paying.
  12. Do supplementary cards have insurance cover?
    This is not a standard feature. Depending on the issuer and the card type, you can get Rs.50000 to Rs.50000 of cover.
  13. What is a credit shield?
    If the cardholder dies, the bills have to be paid by his/her spouse or parent. The credit shield provides for a waiver of payment up to a certain limit, usually around Rs.25000.
  14. Is it advisable to use the cash advance facility?
    No, it should be used only when absolutely necessary. The interest rate is very high, usually around 36 percent per annum. There is also a 2.5 percent transaction fee.
  15. What happens if I delay payments?
    Most companies charge a penalty after the stipulated 'free-credit" period. This is usually a steep 15 percent of the minimum payment due or 2.5 percent of the total outstanding balance.
  16. What is a global card?
    A global card can be used overseas. You can spend in foreign currency and pay in rupees, subject to RBI guidelines.
  17. Can I use my card to buy foreign exchange?
    An authorised dealer can provide foreign exchange on your card up to your basic travel quota.
  18. Can I make dollar payments in Nepal or Bhutan with a global card?
    You have to pay only in rupees in these two countries.
  19. What is PIN?
    PIN or personal identification number is unique to every card. It is normally a four-digit number that allows you to use ATM's etc.
  20. What happens if Ilose my PIN? Contact the bank immediately. It will replace your card and issue a new PIN for a fee.

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