Credit Cards Flashcards
(9 cards)
Name types of credit card and how are they beneficial for credit card companies ?
The most popular are master card, visa and American Express.
The credit card company receives a pourcentage ( usually between 2 and 4 pour-cent) of the payment made to the merchant with its credit card
What are prestige cards, to whom are they issued and how do they work ?
Cards, such as gold cards or platinum cards that are issued to individuals with exceptional credit ranking.
They provide them with extra benefits ( travel insurance, insurance on rental cars, etc.) but they usually charge an annual fee
What are retail (or proprietary) credit cards, what is their particularity in term of interest rates ?
Cards that are honorer only by a specific retail establishment.
interest rates charged are normally higher than that charged on standard or prestige cards
What are cash advances ? How do they work ? And should they be used ?
Cash advances or convenience checks are when you use your credit card to borrow cash rater then to purchase something.
They usually charge high interest rates plus a transaction fee at the time of transaction.
They are and extremely costly source of financing and should only be used as a last resort
What is Credit card financing ?
It is paying only a portion of the credit card bill each month. It is very expensive and should be avoided if possible because it triggers interest rates between 20 and 30 percent
What is a finance charge ?
When you don’t pay the entire monthly credit bill, finance charge is the interest and fees you must pay as a result of your credit usage
What should you strive for when making credit card payments
To pay your entire credit balance in full each month ( minimum monthly payments )
What is a credit card statement ?
Details why your new balance is different from the balance shown on your statement for the previous month
What should be criterias for comparing credit cards ?
Acceptability
Interest rates
Annual fees
Maximum limit permitted
