Credit Card Info

Mistakes to avoid while using your credit card

2009-12-22T22:02:00.000-08:00

With the festive and year-end preparations in full swing, several families are loosening their purse strings. Add to that the convenience that plastic money offers, and it’s very easy to let the itch to spend go out of control. If you are one of those who flash your credit card frequently, you would do well to steer clear of the following pitfalls:

Not reading the fine print

One of the primary causes of disputes is lack of awareness of the terms and conditions that govern the use of your credit card.

“Many people who come to us are not aware of the rate of interest, charges, etc, that their credit cards entail, which, many times, lead to overspending and penalties,” says Abhay Credit Counselling Centre head VN Kulkarni.

Several credit card users are under the impression that paying the minimum amount due every month specified by credit card issuers will reduce their outstanding amount in the due course.

However, the fact is that it will only push you deeper into a debt trap. The card issuer considers the remaining balance to be overdue and charges a hefty interest, which could vary from 42-49% per annum. Given this, the debt burden is unlikely to be eased by paying the minimum amount due.

Unresolved disputes

Several credit card users, in the event of a dispute, prefer to ignore the follow-up calls from the issuer to pay up. It’s best to resolve the same as soon as possible as the interest will continue to be charged till you repay the dues. In addition, late payment fees and other penal charges could be levied and significantly inflate your original outstanding amount.

Although you can withdraw cash from the ATM using your credit card, it’s certainly not a healthy practice as you may have to incur additional charges, which vary as per the bank.

Also, many are not aware that when a credit card is used at an ATM, the interest is charged that day onwards and not after the credit period of 45 days, as is usually the case with swiping the card.

Borrowing to invest

As the last date for making investment declaration falls on December 31 for many salaried individuals, there is a tendency to use the credit card to make tax-saving investments. Considering that the interest charged on credit card outstanding (if not repaid during the credit period) is exorbitant, using it to make investments will actually erode your capital. Therefore, ensure that you use it only if any cash inflow is expected within a month.

“Many credit card users are not aware that their credit limit encompasses any charges levied by the bank. Therefore, if you are paying an interest on the earlier outstanding amount, and yet use up the entire limit, the card issuer could levy overdrawing charges,” points out Disha Financial Counselling Centre chief counsellor Madan Mohan.

Delay in reporting loss

“We have had to deal with several cases where card users have reported loss or theft of credit card to their card issuers after 3-4 days, resulting in miscreants siphoning off the money,” informs Mr Kulkarni.

Remember, credit card issuers will not be held responsible for any misuse during the period they were

Multiple Credit cards

While opting for more than one credit card is not a cause for concern, there is a chance it could lead many users into a debt trap. Many borrowers end up using one credit card’s limit to repay another card’s amount outstanding, paying a huge interest in the bargain.

Also, many opt for certain credit cards only to avail of discounts and freebies that they offer. It is important to realise that credit cards should be maintained solely with the intention of tapping the same during emergencies. No-due certificate Absence

While paying dues to the credit card company under a compromise settlement, you must insist on a ‘no-due certificate’ stating that your dues have been cleared.

The letter should also contain an assurance that the settlement will be reported to CIBIL. This will ensure that you can produce the proof of repayment if your loan application is rejected by another lender, citing unfavourable credit history in the future.

Not keeping PIN under lock

While being secretive about passwords is common sense, many tend to share it with people who they consider trustworthy, disregarding the fact that cases where the trust was broken are not rare.

Although the introduction of a two-factor authentication system has tightened the security mechanism, it is extremely important to give top priority to safeguarding your personal identification number (PIN).

Credit card abuse costing City Hall

2009-12-15T02:16:00.000-08:00

Toronto civic employees have more than 1,000 City Hall-issued MasterCard credit cards to make small purchases more efficiently.

But policies and procedures designed to safeguard the taxpayer against abuse aren't being followed, says the city's fiscal watchdog.

Jeffrey Griffiths, the city's auditor general, is reporting his findings -- and making 20 recommendations for the four-year-old program -- to the audit committee tomorrow. Since the program was introduced in 2005, city-issued credit card purchases have grown from $2 million annually to $8.5 million a year.

In 2008, there were a total of 29,500 credit card purchases. The cards are limited to a single purchase limit of $3,000, and monthly purchases of $10,000. Card holders are also prohibited from taking cash advances or from buying fuel.

It's estimated if the were used for just half of the small orders acquired through Divisional Purchase Orders, the city could save $100,000 a year from increased efficiency.

But in his audit, Griffiths found that supporting documentation was missing from 2% to 3% of purchases, which means the city, Griffiths wrote, "cannot validate the legitimacy or accuracy of these transactions."

Also, Griffiths found "questionable" purchases made for business meetings.

Also, as an experiment, Griffiths' office submitted a credit card purchase with a fake name and it was approved. Some employees who no longer worked for the city still had active credit cards, but Griffiths pointed out no purchases have been made with them.

Which one you like to shop- Ipod or Mp3 player?

2008-11-07T01:57:00.000-08:00

Today if you have dollars to spend nobody could stop you from reaching to the luxury world. Apple's iPod line-up is comparatively simple compared to what other companies offer. But it still makes sense to see what each particular model can offer so you can make a well-informed decision.

The iPod Shuffle is the smallest iPod available. It forgoes the display and it's small enough to clip onto a shirt. If all you want to do is listen to music and you don't care about what particular song is playing, then this is the iPod for you.

You can get one in either 1GB or 2GB storage capacities. Each model can hold 240 or 500 songs respectively. Randomness is a key factor in all of this. If you like small form factors and a certain degree of uncertainty in the songs that play, then the Shuffle will suit you fine.

The iPod Nano melds a small form factor with the power of a full-featured media player. Even with its small size, you get a nice high-pixel wide screen display that can display pictures and video. MP3 players are the ultimate device for portable audio and seem to be one of the must-haves today. As the market offers numerous different models and makes it is difficult to make a purchase decision especially if it is your first MP3 players ever.

On first sight an Apple iPod seems to be the most obvious choice. But it's worth risking a second look at other portable audio products to determine whether they might offer more for your individual needs. The most important selection criteria are surely the sound quality, storage capacity, size and the functionality of a portable MP3 player. Apple iPods come from 1GB up to 160 GB and are still remarkably small. However, other manufacturers like Sony and Samsung have in their product range MP3 players with up to 30GB storage which is enough to store an entire music library on one single device. This storage capacity is recommended when playing videos or for those music enthusiasts who could not select a limited playlist from there library but need to have all their music on the go.

Simple MP3 players with less storage like the ipod shuffle are affordable, stylish and small enough to be carried with you at all time. Nevertheless, you might regret the choice soon when you get used to the comfort of having your favourite music at your disposal at any time.

Find the best online educational programs with us!

2008-11-06T19:52:00.000-08:00

Nowadays, pursuing a degree through online education is common, and the value of online degree from a proper accredited university or college is equally weight than the traditional campus-based degree. With both campus-based degree and online education you have more options to choose from if you want to earn a degree for you career advancement. Online education has many advantages that can benefit its students, but it may not be a good option for all students; then what makes online education a better option for you?

Amongst the advantages of distance learning, online education, likewise, offline (traditional college) classes have the same course materials, merely one is expected to sign up for an online class. The online course structure is also the same as the normal classes themselves, but students are asked to order books from online book store. Students can entertain the class participation and discussion on problems they encounter in the course in the chat rooms and forums. Most students write their views on the issues. Students who have weak language skills can keep an easy pace with the discussion made and view posted. Online education's major source of face to face interaction is through live video and sound with special equipment.

For many people, in the today's busy world, a face to face class is very difficult. If a person works 8 hours on daily basis he could hardly manage taking regular college and ultrasound school. But an online course can put an ease on the time restriction because the person does the work at their own pace and time.

Career Education.net is a site to help consumers find online and offline educational programs to help them get the job they want. As the price of education is attaining its altitudes, the rates of students applying for online educational classes are continuing to get greater. Teachers can also record themselves on the required locations and the student can download the film in case the session is missed. This gives a student the chance to catch up on a class session if s/he missed out on that day.

Automotive training schools online!

2008-10-14T21:27:00.000-07:00

Nowadays it’s very easy to buy a car but to drive it safely is quite risky so for that just join any automotive school. Online Automotive Training Schools offer instruction on the basic concepts and functions of automotive engines through instruction modules. Online Automotive Training begins with instruction on the fundamentals of electrical circuitry, fuels, batteries, motor functions, etc., presented in written, diagram, and sometimes animated forms.

Automotive Training curriculums must continually be updated to keep apace of rapidly changing technology in the automotive industry. Today electronic systems and complex computers run automobiles while measuring performance on the road. Students can expect to learn the essentials of maintenance and auto repair procedures from tires and suspension to computerized functions through Online Automotive Training modules. Courses will emphasize the development of a solid understanding of functions that will be necessary to effectively diagnose and analyze automotive problems.

Course studies in Online Automotive Training may include good communication skills and techniques in relation to customer service. Other skills that will serve an Automotive Technician are sound reasoning capabilities and a thorough knowledge of the complex components and interactions of auto bodies and motors.

Online Automotive Training programs may take up to a year. Completing an Automotive Technician Associate Degree, which includes laboratory studies, can take up to two years. Certified Automotive Technicians can expect to be subjected to regular review and recertification requisites.

Find out the best automotive schools online automotive-schools.us and begin your training for a career in automotive maintenance and repair.

Grab the right computer training program online!

2008-10-10T19:48:00.000-07:00

Nowadays computer education is must for all age groups and every field whether it is hospitals or mechanical engineering. In order to increase your chances in the job market you have to take up focused training programs, which will enhance your skills and enable you to accept challenges at the workplace. As the entire world is headed towards computerization, a course in computers will certainly brighten your chances to get a decent job. Computer training schools cater to the increasing demand for trained computer professionals in the industry.

Computer training schools can be found both online and near your workplace or home. Before you head towards any computer-training center, it is advisable to find about current trends in the software and hardware markets. Search on the net or talk to some professionals regarding the ‘in-demand’ training programs which will secure your chances to get hired by the employers.

Computer training is not only for students who major in computers. The training centers are filled with busy executives who regularly take courses to keep up with current trends. In this competitive world it is very important for these professionals to know the latest software packages and hardware tools available.

You can choose from an array of programs ranging from basic programming concepts to complex and comprehensive graphics and networking courses. Don’t be surprised to see housewives in a computer-training center near you. These ladies want to help their school going children in their studies and want to be updated in order to ensure a smooth sailing when they start work again. Start your child’s future with the best it schools so that he/she could make a strong base to face the competition.

The businesses have also realized the importance of training their employees on a regular basis. Since the workers find it difficult to take time from their busy schedules, these organizations hire reputable computer training schools to train their people either at their offices or in the specific computer training school. You may also contact at http://www.technical-schools.us/

Build your career in nursing programs!

2008-10-10T01:53:00.000-07:00

Are you searching the right nursing program to build your future? What type of nursing degree is best for you? What type of nursing school should you go to?

There are two basic types of nursing degrees: A degree in Licensed Practical Nursing, (called Licensed Vocational Nursing in some states) and a degree in Registered Nursing.

The LPN degree can be a good starting point for your nursing career. You need a high school diploma or GED to be accepted into an LPN school. Many community colleges and technical schools offer LPN degrees. Not many four-year state universities offer them. Some private, for-profit schools in your area probably offer them as well; Galen, Kaplan, Keiser, and the University of Phoenix are all examples of these types of schools.

LPNs earn less than registered nurses and work under the direction of registered nurses. Some hospitals will not hire LPNs and only hire registered nurses.

If you want to progress into a managerial position as a nurse, you will want to become a registered nurse. One way to do this is by becoming an LPN first and then, while you are working as an LPN, taking an LPN to RN program online or at your local community college. The advantage to this is that you will be working and bringing in a salary, and also, your employer will very likely help pay for your continuing education (usually in return for signing a contract that ensures that you will continue working for them for a specificfied period of time.)

So which option is better for you? There are a number of considerations, such as how quickly you want to get your degree and start working. An lpn school degree will get you working more quickly. However, if you know that you want to progress further in your career, possibly into a management position, and you have the time, money and ability to go to school for two to four years, you may want to consider obtaining a degree in registered nursing instead. Nursing-School.org helps people find the right nursing education program. We have a large directory of nursing related schools and plenty of information about jobs in the health care and nursing industry.

Best online fashion design schools

2008-10-10T00:38:00.000-07:00

Nowadays people are crazy about the latest fashion trends which celebrities wear. The world of fashion is one that has the eyes and ears of a vast amount of people; we watch television, read magazines, and stay tuned to see what the rich and famous are wearing from day to day – and we follow suit. Fashion can change perceptions, impact an entire retail economy, and influence a generation. It’s no wonder that more and more people are interested in joining the world of fashion design.

Fashion design entails the creation and manufacturing of clothing styles. Fashion designers work based on seasons – they design, create, and then introduce their line of clothing on the fashion runways. The clothing that is well-received suddenly makes its way to Hollywood where actors and actresses come decked out in the latest fashion to the latest movie premiers. And what happens on that carpet trickles down to the masses making its way to retail outlets all over the country in more affordable forms.

Fashion design can be a fantastic career journey but it requires a vast amount of skill, education, and hard work. Those interested in fashion design should already possess an innate ability to create beautiful design and effectively communicate them on paper. Following a school program – or even in conjunction with a school program – those pursuing a career in fashion design should be sure to involve themselves in an internship or apprenticeship with a reputable design house. The experience gained in this capacity is unmatched and will begin building your portfolio – your most important tool in a fashion design career.

Fashion-schools.org offers the best fashion design information which can be a wonderful career filled with adventure, creativity, and a chance to influence clothing choices all across the nation and even around the world.

Best online culinary schools for you!

2008-10-09T21:21:00.000-07:00

Nowadays cooking has become crush for many teenagers. Culinary schools where cooking is taught. Today, cooking is an art, rather than just cooking. There are several specialties in cooking who can make you an expert chef, either for professional reasons or just for fun. They teach fundamental and traditional cooking while encouraging innovation and novelty. Getting trained at a culinary school may help you become an executive-chef, sous-chef, saucier, garde manager, pastry chef, or a sommelier.

There are also online culinary schools that provide training in culinary skills. These offer several courses relating to pastry preparation, wine tasting and selecting, knife skills, baking and dessert making, holiday cooking, healthy cooking, regional cooking, style cooking, safety and sanitation, cost management, food handling and identification, food and nutrition, special cuisines, gourmet cooking, catering and more.

Online culinary schools offer certifications that are applicable worldwide. They have good facilities and instructors, food service operations, job placement assistance, good credentials, teaching by experts, hands-on teaching, and so on. There are different kinds of certifications available: diploma programs, associate’s degrees, apprenticeship programs, bachelor’s degree programs, vocational programs and certificate programs. These programs are also offered in different levels, like level 1 for basic introduction, level 2 for more experienced cooks and level 3 for learning professional cooking.

There are many online culinary school that provide courses for beginners, amateurs and professionals. Many professional culinary schools are also offering online courses. Information can be found online or at the websites of these schools. For further assistance you may visit http://www.culinary-schools.us

Credit card companies may raise fees to skirt rate cap

2008-10-05T21:21:00.000-07:00

Many leading credit card issuing banks have started upgrading their credit card customers’ higher range of credit cards i.e. to platinum or titanium cards.

In addition the banks are also making working on a back-up plan in case the Supreme Court turns down their petition against a consumer court decision to restrict the annual interest rate at 30 per cent.

The apex court will be giving its judgment on this matter in a few days time. Leading bankers told they might not be left with no other option but to impose a steep annual fee lest the Court agrees with the consumer court’s opinion.

Earlier in order to grab market share, most banks had waived the annual fee on credit cards. Leading banker pointed out, “We will have no option but to impose a hefty fee if there is a cap on the interest rate. In the process, the business itself would become unviable, forcing many of us to withdraw”.

Although many banks have already started “upgrading” their customers to platinum or titanium cards with a few free offers in return for an annual fee. But the numbers seems to be still too small and banks are taking the move of upgrading the customers very cautiously due to fear of losing customers.

Bankers state that credit-card business is not profitable in India because of high administration costs and the small ticket size of transactions.

“The average ticket size is just Rs 1,500 and the administration costs are too high. Besides, the default rate in this segment is also pretty high. Thus, it doesn’t make sense to cap interest rates at 30 per cent,” a foreign banker said.

Another banker stated that high rates also lead to lower mis-selling and raise the entry barrier. But others are of view that banks themselves are responsible for this mess. At present the default rate on credit cards is 8-15 per cent and this is going up mainly due to the practice of issuing free cards.

“Too many credit cards prompted many borrowers to spend beyond their means leading to delinquencies,” admitted a banker.

A few weeks ago, a group of foreign lenders including Citibank, HSBC, Standard Chartered Bank and American Express Bank had filed a case in the apex court challenging a consumer court’s judgment that a bank cannot charge beyond 30 per cent annually on credit cards, even in cases of defaults.

The banks argued that capping of interest rates on credit card payment is opposite to the Reserve Bank of India policy which gives banks the freedom to fix rates on non-priority sector personal loans, in spite of of the loan size.

The apex court has given the banks three weeks’ time for put forward their explanation and feedback on the high credit card rates, which range from 35 to 50 per cent.

Currently, Citibank is having over 3.7 million credit-card holders in India. HSBC, which manages about 2.8 million credit-card accounts here, charges annual fees in the range of Rs 750 to Rs 4,000 depending on the category of the card. ICICI Bank charge annual fees in the range of Rs 1,500 to Rs 25,000 according to the features of the card. About 50 per cent of the bank’s card-holders hold free cards.

Your mobile phone may soon be able to be used as credit, debit card

2008-09-30T03:51:00.000-07:00

New developments are being done in the mobile sector. With the latest development there can be complete liberalization in the mobile commerce, the department of telecommunication (DoT) will soon be putting forward an application to the Reserve Bank of India (RBI) for seeking guidance on linking telephone networks with banking services.

Recently RBI outlined certain guidelines for mobile banking in India, under which it has allowed only a few basic banking services which can be undertaken through mobile phones. But as per new DoT move the consumers will virtually be able to use their mobile phones as a debit or credit card.

Sources informed Sunday ET that the ministry will ask for RBI's consultation to provide full-fledged mobile banking services to the customers, as per discussions held between the 13th Finance Commission team and DoT officials on September 18, 2008. As per a senior DoT official, the ministry up till now has not taken up any program on linking telephone networks with banking services, but is eager on it as it will help in generating revenues, besides giving more value to telephone customers. "These services can increase the share of value-added services from the existing 7-8% of total revenues from the sector to almost about 25% which is the case in the developed countries," DoT said to the Commission's team. Sunday ET has been provided with a copy of the discussion paper prepared by DoT.

Shetty, director at KPMG India, while explaining how the new initiative will help Indian consumers, said it will change the entire face of banking in the country. "So far, consumers can make only a few basic transactions through the mobile, but this will mean using your mobile as your credit or debit card. All you have to do is to send a message to make a payment,” he said.

In India mobile segment is primarily limited to basic banking transactions, purchase of travel tickets and payment of some utility bills, checking your account balance and last few transactions. Sanjiv Mittal, vice-chairman, Bharti Telesoft, is providing mobile banking facility to the customers in collaboration with Barclays Bank think that both, banking and telecom industry, will have to come together to make mobile commerce a success in India. "There are certain laws to be considered regarding money remittances. Considering the IT security condition, coming together of both is a good sign," he said.

Vodafone is also offering services like querying bank balance, requesting for cheque book, making stop payment etc. These services are being provided in association with banks such as HDFC Bank, ABN AMRO and Kotak Mahindra Bank. "Mobile banking is necessary to create access to the remotest of areas. Any kind of convergence is good for promoting mobile commerce. There is nothing better than both the systems coming together to provide a framework," said a Vodafone official.

The DoT's interest in the subject is sending positive signals to industry. "If the ministry takes up the matter with the RBI, it will definitely speed up the process. It will not only help the mobile users but will boost banks and even mobile operators to grow further," added Mr Shetty.

The DoT has informed the Finance Commission's team that revenues from auction of spectrum for 3G and BWA services approximately can go up to Rs 30,000 cr. The 13th Finance Commission has asked the DoT to give the revenue details from the telecom sector between 2010 and 2015.

State police arrested city’s first credit card ‘skimmer’

2008-09-15T00:49:00.000-07:00

Ahemdabad police arrested Kalpesh Patel for credit card frauds worth Rs 1.5 lakh, though police believes that the fraud amount is much bigger.

Kalpesh is a young corporate executive who did purchases at a prominent departmental store on the SG Highway and made payment by credit card for his purchases worth Rs 5,000. By chance, the credit card swipe machine went offline and the transaction was completed to avoid customer inconvenience.

Much after the customer left the store the credit card company realized that they have been cheated. The CVV number used to complete purchase through credit card proved to be fake! Many more fake transactions were done in July, August and even in September and the card swipe machine would be always on the blink.
Satellite police station officials have finally caught the credit card fraudster. He turned out to be 32-year-old, Kalpesh Patel. Satellite police station officials told Kalpesh has been sent to judicial custody on Monday. He was interrogated by police officials and private sector major bank employees to know how he did it.

The cops are now more worried about the technique used by the fraudster. "Kalpesh could actually make the card swipe machines go offline. It is still not clear how. In the online mode, the machine sends transaction information, real time, to the central server which keeps a watch over all transactions simultaneously. Being offline, this interaction with central server did not take place and thus Kalpesh could make the purchases even with a wrong CVV number," said the police officials.

A private bank detected fraud when there was periodical ‘failure’ in the swipe machines of the credit card in several joints including petrol pumps, restaurants and shopping malls. The bank on further investigation found that the cards were used by impersonators.

"The transactions varied from Rs 300 to Rs 5000. As the amount was not very alarming, few of the card owners realized the fraud. In the primary investigation, we came to know that around 11 cards were misused in this fashion," said a Satellite police station official.

JJ Patel, inspector of Satellite police station, told TOI press person that Kalpesh has been booked for criminal breach of trust and fraud and forgery. Cop informed that he has been sent in judicial custody on Monday. "We have called upon experts to understand his modus operandi. As per primary information, he procured credit card database in electromagnetic format and copied it to some other credit cards. He then used these duplicate cards to make purchases," Patel said.

Police suspect there might be more people involved with Patel in this racket. "We are hunting for those who provided him the credit card details of other users, who him the know-how for making duplicate cards and making the swipe machine go offline," said police investigators.

The technique of credit card transaction

Usually swiping machines are connected to a leased line working on GSM or CDMA technology. The telephone line connects the machine to the main server of the bank and the service provider - Visa or Master Card. When credit card is swiped, the machine sends the information to the server that verifies the transaction. If the online mode is not available, the establishment can use offline mode after inserting three digit CVV code. Mostly the offline mode is used only for customers' convenience. In case of offline mode, the data is then sent to the server when the machine is back online.

Corporation bank in tie-up launched prepaid travel card

2008-09-11T01:45:00.000-07:00

Corporation bank, Mangalore-based public sector bank has launched prepaid travel card in a tie-up with JP Morgan and Visa. Bank has used JP Morgan’s expertise in prepaid card solutions and its proprietary technology platform. Bank has launched the card in three foreign currencies -- US dollar, British pound and Euro. Corporation Bank has become the second public sector bank, for launching a prepaid travel card, earlier only State Bank of India had launched a prepaid travel card.

Bank is offering the benefits like customers to make a purchase, withdraw cash in local currencies at ATMs when traveling abroad. The card will also be easy to carry and lower the risks of carrying foreign currency and travelers' cheques, B R Bhat, general manager, Corporation Bank said. He said the customers can get the balance amount in the card refunded at any of the designated branches of the bank.

The bank has planned to sell at least 25,000 cards during the first year of its launch. Very soon bank is planning to introduce the card in Chinese currency also..

RBI reports show increase in credit card spending in 2007-08

2008-09-07T23:37:00.000-07:00

According to the latest data released by the Reserve Bank of India (RBI) there has been increase in the card transactions both debit and credit. The number has increased by 42 per cent to Rs70,459 crore during 2007-08. One of the reason for the rise in card transaction can be large number of banks are issuing plastic cards and merchant acquisition business also scoring well with the coming up of retail

By looking at the figures released by RBI clearly testifies that growth in plastic money has gone much higher than the 24.51 per cent as recorded in 2006-07. This is because people have started adapting themselves to banking technology, and, moreover banks are also encouraging the use of cards on account of the lower per-transaction cost.

Plastic money is convenient to carry than cash, but with the ramping up of ATM networks for both cash and non-cash transactions, and the propagation of merchant acquisition points across the country by both new organized retail and traditional retail merchants, card transactions has acquired wider acceptance. In addition to this banks are offering incentives such as cash-back schemes and discounts at certain retailers to popularize the use of plastic money.

Unlike the credit card, use of debit cards is more preferable to the banks as it ensures that more cash stays in customer's accounts. Moreover the card ensures fewer visits to the branch, since most of the account functions such as cash deposit / withdrawal, cheque deposit, ordering cheque books and statements, and even funds transfers can be carried out via ATM. Also, use of cards is more cost effective for a bank, rather than service him at a branch.

According to RBI's data even the number of cards issued has increased by 46.7 per cent to 88.31 million as of March 2008, in comparison to 60.17 million at the end of financial year 2006-07.

There has been increase in the credit card outstanding also. During 2007-08, the total credit card outstanding has risen to 43.6 per cent to Rs 5,843 crore. Till May 23 this year, the outstanding has gone up by 87 per cent to Rs 12,375 crore. In 2006-07, the value of credit card transactions has also gone up by 22.06 per cent.

Another reason for the increase in the use of plastic money is the growth of e-commerce and transactions via the Internet. Booking of airline and railway tickets have added to this segment, and, more and more people use cards as a payment mechanism for utility services.

Bankers are of view that debit card usage can outshine credit card usage mainly because of convenience, which is a primary factor for the adoption of plastic money. Besides, unlike credit cards, borrowings / loan from the bank is not attached to debit cards and in general debit cards do not need a credit review before they are issued, this makes them ideally suited for a larger population of the banked public.

LIC to launch its credit card in October

2008-09-03T03:52:00.000-07:00

The senior divisional manager Bhausaheb Gujar in a press meet at Nagpur told the reporters in October Life Insurance Corporation of India (LIC) will be launching its credit card.

Speaking at the occasion of LIC’s 52nd anniversary Gujar said that LIC is working on the plans of finalizing the partner and there is possibility it would be introduced in the next month. However he declined to disclose the name of the partner.

Earlier there were reports that LIC is thinking of launching the card in association with GE Money.

He stated, ''We were in negotiations with a firm, but the deal could not be finalized for some reason. We are now negotiating with another partner, and the talks are in final stages. In all likelihood, LIC's credit card will be launched in October 2008''.

Gujar informed by the next year LIC, will start accepting premium through credit cards and currently it is procedure of completing formalities.

''Hopefully, premium payment will start by the next financial year,'' he said.

Meanwhile the insurance giant has authorized Corporation bank and Axis Bank to accept premiums from those who are having account in their banks.

He told that policyholders can use internet, electronic clearing g service, automatic teller machines (ATMs) of Corporation Bank and Axis Bank, online collection at Axis Bank branches and LIC's portal for paying their premiums.

He informed LIC recently has introduced the SMS facility for payment of premium, at present this facility is available for account holders of Corporation Bank only.

Recently LIC has added 375.90 lakh new policies, which collectively assure the sum of Rs2,75,457 crore during the financial year 2007-2008. He added the first premium income attained during the period was Rs43,812 crore.

Bajaj Allianz Financial Distribution Ltd to venture into credit card biz

2008-08-28T21:11:00.000-07:00

Soon the Bajaj Allianz Financial Distribution Ltd (Bafdal) will be making its venture in credit card business. In Bajaj Allianz Financial Distribution Ltd (Bafdal), both Bajaj Finserve Ltd and Allianz SE of Germany have a 50:50 partnership.

“We are talking to a few players, but nothing has been finalized yet,” said Jitendra K. Bhagat, chief executive officer of the company.

Bafdal, has started mutual fund distribution business. Bafdal has started this business in a joint venture with Taurus Mutual Fund which is distributing life and non-life insurance products as well as consumer loan products of group companies.

“Credit cards are complementary to our consumer finance business. We have not yet decided whether it will be a proprietary or a co-branded card. The card will be launched within this financial year,” Bhagat said.

Regarding the distribution of mutual funds, Bhagat told that the company had short listed five fund houses to sell their products. “In fact, Allianz itself has applied to market regulator Sebi for a license to start asset management business in the country. Given the long understanding and association with the Bajaj group, I believe, the mutual fund business will also be carried out by the Bajaj Allianz alliance,” Bhagat said.

Taurus, the second-oldest mutual fund house in the country after Morgan Stanley, on the other hand, is planning to catch up with its peers.

Waqar Naqvi, has been recently positioned as the CEO of Taurus Asset Management Company said, “The promoters were not focused on increasing the distribution network. Now we want to increase our distribution network aggressively. We are expanding the number of offices and employing more people.”

Currently Taurus is having eight schemes and Rs 400 crore of assets under management. Out of which Rs 150 crore is under debt funds and Rs 250 crore under equity schemes.

The fund has a net worth of Rs 150 crore and will be utilized in its expansion. “Our net worth-to-AUM ratio will be the highest in the industry,” Naqvi said.

Banks allow conversion of credit card dues to loan

2008-08-19T04:09:00.000-07:00

More and more banks are encouraging borrowers to convert credit card dues into personal loans with an aim to keep away defaults which can be prompted by inflation and rising rates. All leading banks are giving an option to the investors of making payments for purchases in installments. Some banks are being practical and, others are giving the option as part of a restructuring package after classifying the customer as offender.

As per the Reserve Bank of India (RBI), data credit card transactions amounted to over Rs 60,000 crore between May 2007 and May 2008. According to RBI data around 20% of card transactions were rolled over, resulting in Rs 12,000 crore of credit card receivables, which have been classified as loans by banks. In the earlier years, the amount classified as loans was less than 10% of credit card transactions. Banks are fearing the rising interest rates and prices are eating into the disposable income of borrowers, which can increase the chances of default.

Credit card dues after the initial interest-free period draw interest rates of over 18-38%. Thus personal loans can be availed against this at rates starting from 14%. Banks have started becoming more practical therefore, for some time banks have been offering the facility of paying for purchases in installments to their cardholders. In some cases, banks have started giving suggestions to the customers who make large transactions. Otherwise banks give this offer when a customer fails to make a large payment. For instance at present, SBI Cards is offering the EMI scheme on transactions of more than Rs 2,500.

Banks have started keeping a watch on the customers who have not been regular with their payments. “We have an idea about customers’ spending patterns through the transaction monitoring alert system. If a customer spends an average of Rs 8,000 on his credit card every month and suddenly we witness a transaction of Rs 50,000 billed in his name, we call the customer. We inform the customer that he/she has an option to convert it into EMIs, which could weigh lesser on his pocket,” said ICICI Bank head, cards group, Sachin Khandelwal.

Mr Khandelwal added in case customer plans to buy an appliance for Rs 20,000 but ends up spending Rs 40,000 on a higher-end product, then bank offers these options to customers at the store itself. Get all the best credit cards offered in India by all major banks with their attractive rewards points.

With cards the traditional way has been replaced where consumer durables used to be financed through dealerships, which is costly.

Citibank is offering the conversion of the out standings on cards into personal loans. Still these customers will be reported to the credit bureau. “Customers who become delinquent are also offered special installment programs called ‘settlements,’ which ensure structured payments in a timely manner and reduce their overall credit burden. Once again, Citibank works directly with the customer to understand their overall debt and evaluates their cash flows to ensure that this personalized payment plan is affordable on a monthly basis throughout the tenor,” said Citibank business manager-cards Sandeep Bhalla.

Mr Bhalla added that the bank is cross-selling installment loans to customers in order to help them in meeting their purchasing and payment needs through marketing efforts. “These are designed and delivered after having a conversation with the customer on his or her overall needs and ability to pay, based on monthly cash flows. This interaction determines the amount and tenor of the loan, such that a customer can manage the monthly payments to Citibank along with their other payment obligations. These promotions are offered through certain preferred vendors at points-of-purchase or upon request by customers post their purchase,” said he.

Tata Capital to venture into credit card business of Tata Group

2008-08-06T03:46:00.001-07:00

One year back Tata Capital, a finance company was launched offering a suit of financial products. Now Tata Capital will be venturing into credit card business of the Tata group, with an aim to boost its product portfolio targeted at retail and institutional customers.

In February 2006 first Tata card, the country’s first white label credit card was launched, in association with SBI, that marked the group's re-entry into plastic money business. But in 2003, Tata group company —Tata Finance — sold its credit-card business to ICICI Bank- country's largest credit card issuer with over 8 million customers.

A Tata group executive informed that Tata Capital's possibility of managing the credit card venture from Tata Son's can not be ruled out in future, as it is more synergic to Tata Capitals retail finance operations which offer personal, car and home loans.

The exact number of cardholder base of the Tata card can not be ascertained, the card was launched to tap the huge employee and customer base of the Tata group by rewarding them each time they buy a Tata Indica car to Titan watch to Voltas air conditioner. On a White label card, the logo of the issuer is not show on it as against a co-branded credit card, which bears the logos of the alliance partners. The group has employs around 3.50 lakh people worldwide.

Currently SBI card is having a base of around 3 million cardholders. The top players in credit card segment are ICICI Bank, HDFC Bank, Citibank, SBI, HSBC and Standard Chartered Bank. In India credit card base has grown to 27 million from 17 million in 2006.

Credit Card Holders Association appeals RBI to put cap on interest rates

2008-08-05T05:15:00.001-07:00

The Credit Card Holders Association (CCHA) has appealed the Reserve Bank of India to put a restriction on the interest rate charged by different banks and also to take strict action against the banks who are using recovery agents to harass debtors.

CCHA general secretary C V Giddappa said, "Rate of interest charged by banks range from 36 to 42% in addition to a 12% service charge. In spite of the RBI decision to regulate the appointment and engagement of recovery agents, banks continue the practice".

He informed that recovery agents harass debtors in case they failed to repay a single installment of the debt incurred on their credit cards. He added, "There have been cases where a bank has, at one go taken the entire debt amount from the card holder's account."

"Several people have complained of banks registering criminal cases in places away from the residence of the customers ".

RBI plan to make ATM usage free from 2009

2008-08-04T04:23:00.001-07:00

Deputy Governor V Leeladhar said banking regulator Reserve Bank of India is worried on the rising defaults in credit cards.

He said, “Credit card defaults are rising and it is a matter of concern. It just shows that due diligence was not done while selling cards”. Deputy Governor added credit card issuances are not picking up the face.

While speaking on the sidelines of a banking conference Leeladhar said that the Payment & Settlements Systems Act 2007 is likely to be conveyed by the government in a week’s time.

The act will legalize electronic payment systems in the country and will bring global non-banking payment companies like Western Union, Visa and Mastercard under the control of the RBI.

Leeladhar informed RBI has plans to make ATM usage free from 2009, the process is on track after the largest public sector bank State Bank of India, joined the National Financial Switch (NFS) two months ago.

“SBI handles about 25% of the three lakh daily ATM transactions. After they have joined the NFS, they have got customers from other banks using their ATMs, which is a good sign,” he said.

SBI is having the largest ATM network in the country and it is the only largest bank which had avoided getting into an ATM sharing agreement with any bank, or joined a switch.

Leeladhar added as SBI has joined the NFS, soon other banks will follow suit. “There are 2-3 public sector banks which are yet to join, but I am sure they will also do so soon,” he said.

The RBI will be recommending a national centralized electronic clearing system (ECS) for funds transfer. The ECS system has gained popularity for payment of bills and mutual fund systematic investment plans has been currently divided into different zones.

“We are planning to centralize it at the RBIs national clearing cell at Nariman Point. It will be linked to banks’ core banking platform,” he said.

The RBI also has plans to make use of satellites to reach banking services to areas which are unreachable. The RBI will be helping banks lease satellite’s for this purpose and also pay the cost on behalf of the banks.

“For hilly terrains like the North East we plan to pay the full cost, while for rural areas we will pay 75% of the cost and 50% of cost for semi urban areas,” Leeladhar said.

He added that satellite is the most ideal back up for banks as it is most disaster proof.

Meanwhile, the Indian Banks’ Association (IBA) also has plans to start a payment and settlement switch for which it expects to get license by the middle of August. “It will be called National Payment Corp of India and will be owned 51% public sector banks,” said K Unnikrishnan, deputy chief executive, IBA.

RBI issue circular to banks on credit card rates

2008-07-30T04:56:00.000-07:00

The Reserve Bank of India (RBI) has issued a cautionary circular to banks on credit cards rates to protect customers and stop defaults. RBI has also warned the banks that they themselves will be liable for misuse of unwanted cards.

RBI said banks must set ceiling for interest rates including processing fees though the central bank has not specified any limit.

The central bank stated that any bank or government body must inform about increasing or reducing interest rates.

As most customers are not aware or mislead into the method of calculation of charges RBI said there is a need for illustrative examples should be given to the cardholder to avoid any confusion on customer front.

RBI's issued cautionary circular on credit cards in view of a fear of rising defaults faced by banks. The easy availability of cards is coming back to trouble banks, as they are struggling to control losses and defaults. By issuing this circular, the RBI has tried to prevent this becoming a general issue.

Police arrested three persons and busted credit card racket

2008-07-28T01:00:00.001-07:00

Police busted another credit card racket by arresting three persons identified as Vipin, Hazari and Ghanshayam, aged between 25 and 30. Accused did shopping worth Rs 30,000 with the fake credit credit. The accused had replaced the original credit card of Adarsh Khanna with the fake one.

On June 27, the victim Adarsh Khanna had applied for a credit card to Kotak Mahindra Bank. The police arrested the three accused on July 23.

DCP (Outer) Sagarpreet Hooda told, "Later a man, posing as a bank representative, who identified himself as Arun, came to meet him. He took Khanna's ICICI Bank credit card to take an impression of it. He replaced it with another credit card deceptively. Khanna soon realized this and called the customer service to block the card, but it nearly took three hours and by that time the accused person had indulged in shopping worth Rs 30,000".

On the other hand, one Nitin, who claimed to have been calling from Kotak Mahindra Bank called Khanna, and inquired whether his executive had verified documents.

When Khanna described the incident to him, he said that he will ask his executive to come back and return the card, but nothing happened and later on Nitin's mobile phone was found to be switched off.

The police came to know that the accused had purchased two mobile phones and shirts from a mall in Inderlok. Later on they stopped using their mobile phone and even left their rented accommodation.

Yet, police was able to caught the three accused from Rohini with the help of CCCTV image and recovered the credit card belonging to Khanna. Police from them was also able to seize goods purchased with the help of credit card.

Barclays Bank offer 10% cash back offer on debit cards

2008-07-23T05:12:00.000-07:00

Barclays bank is offering 10% cash back to all its debit card customers. According to bank sources the offer is valid on all purchase transactions made in the country using a Barclays debit card from July 1 to September 30.

According to bank statement customers will receive a total cash back amount of up to Rs 500 per month, which will be credited to the customer’s account in the first week of the next month.

During the campaign period if a customer does a minimum of three purchases (minimum Rs 500 each) per month then he can avail this facility.

The statement specified the offer is not applicable on the ATM and outside-the-country transactions on the debit card.

As per statement new customers who open accounts during the promotional period will also be eligible for cash back offer if they make at least three transactions per month, each with a value of Rs 500 or more.

The scheme is available for all the customers using Barclays Classic Debit Card, Barclays Premium Debit Card or Barclays Gold Business Card.

Barclays is providing services in retail and commercial banking, credit cards, investment banking, wealth management and investment management services. Bank has made its presence in Europe, US, Africa and Asia with operations in over 50 countries.

Mumbai police arrested 19 yr – old girl for credit card fraud

2008-07-22T03:15:00.001-07:00

Muskaan Shaikh a 19 years old girl has passed class XI and is a resident of Aurangabad has mastered the art of forging signatures with ease. Shaikh was busy shopping at the Infinity Mall in Andheri (west) on Sunday when her shopping spree came to an end when an alert employee noticed that her signature did not match with the one on the credit card.

At the mall when she went into the Reebok store after visiting a few other outlets. She selected a pair of sport shoes costing Rs4, 000. Inspector Datte Sankhe told, “Shaikh confidently went to the cash counter and offered to pay with a credit card”.

At cash counter the executive asked her to sign on the credit card receipt. The alert executive noticed that the signature did not match with the one on the card. He then kept Shaikh involved in a conversation and meanwhile alerted his seniors, who got in touch with the police.

Sankhe told, “We found 12 credit cards belonging to different people from her purse”. Most of the credit cards were stolen from Mumbai. Earlier in May, a middle-aged woman had lodged a complaint about her purse being stolen from the Infinity mall. Police said watching the CCTV footage it was clear that Shaikh was responsible for the act.

Police has taken Shaikh in its remand till July 24.

Chennai police arrested two Lankans for credit card fraud

2008-07-21T03:39:00.001-07:00

Chennai police on Saturday arrested two Sri Lankan Tamils for defrauding a bank to the tune of Rs 5 lakh using forged international credit cards. The duo created fake credit cards using information stolen from foreign credit cards, mostly in London, through an accomplice.

The two arrested - S Navaneethan (28) and S Rajkumar (24) - are Sri Lankan natives living in Porur. Rajkumar had recently completed his graduation in commerce (B. Com) from a private college in Aminjikarai.

On getting clue from a leading mobile telephone showroom in Kodambakkam, officials of the Axis Bank laid a trap for the duo on Saturday. The employees of the showroom got suspicious after the two did purchasing on three consecutive days; they purchased mobile phones and electronic equipment worth about Rs 1.70 lakh. The duo did the payment through international credit cards.

On receiving information the Axis Bank officials, led by Ashok Kumar of the executive risk and fraud containment wing, laid a trap and waited at the showroom. The duo Navaneethan and Rajkumar, as usual, came to the showroom and were nabbed by the bank officials.

From the duo credit cards were seized and verification done. During enquiries it was revealed that Navaneethan and Rajkumar had been using the credit cards of many unknown persons, mainly of those living in London, to make expensive purchases. The accused were taken to the police commissioner's office and produced before the city police commissioner R Sekar.

Ashok Kumar officially lodged a complaint with the central crime branch. On the basis of complaint lodged by Ashok Kumar the bank fraud detection cell in the commissioner's office have registered a case and arrested the duo.

During the preliminary inquiries it became clear that the Navaneethan got the credit card details from another friend, who is now in London. Using this information the duo prepared fake cards at their residence and did purchasing of several electronic goods and household articles from several city showrooms.

"The two had been making such purchases for the past four months," an investigation officer said.

Moreover officials of another bank went with a complaint to the city police against the two persons, in their complaint the officials stated that the accused had gone to a star hotel in Nungambakkam and had spent nearly Rs 2 lakh there.

The police have discovered a television, refrigerator, two-wheeler, two mobile phones, three fake credit cards and a pen drive with data about credit cards from the hotel room. The arrested two have been remanded in judicial custody after being produced before the XI metropolitan magistrate court in Saidapet on Sunday.