There are many credit cards in the world today; in fact most people have more than three cards. If you are thinking about getting your first card it is important to know the basics of these cards before you apply, to make sure they are right for you. Here are some of the credit card basics that you may not know about:
First of all, these cards are small rectangular pieces of plastic that have numbers and letters imprinted on them. Each time a consumer wishes to make a purchase they can use this card to complete the action. Transactions can be done by phone, over the Internet, or at a business via a machine that reads these cards. A credit card machine is a small computer that an individual uses be swiping their card through it VCC buy . The computer then reads the numbers and approves or declines the purchase based on the person’s current available balance amount on that card. Every person has different numbers on their card in order to make sure that the right person is billed for each purchase.
Credit cards differ from debit cards. Consumer can choose to have their purchases transacted as a debit or a credit transaction, the difference is that with a credit transaction you are effectively borrowing the money for the purchase and with a debit transaction you are using your own money. As you are borrowing money when you make a purchase on a credit card you will be charged interest on the card balances that you maintain. However, with debit cards you will not be charged any interest as the purchases are made with your money and you are not borrowing anything.
Anyone that is over the age of eighteen and has a valid Social Security number can apply for a credit card. Consumers will see a list of their accounts on their credit report, and the amount of debt that becomes accumulated is also listed on the report. It is important for people to pay their monthly card repayments on time in order to keep their credit history as pristine as possible. When credit companies view an application for a credit card they will first look at the person’s credit score and report, to see how well they manage their personal finances.
If a person has a poor credit score then they will most likely be declined for a card or will only be given a card with a very small credit line. Credit lines can be changed every six months so individuals that work on their credit score can apply for a credit line increase whenever they choose. The basics of credit cards are important as many people today seem to be applying for a card without knowing what they are getting into. Remember, managing personal finances requires knowing the facts and making solid financial decisions.
You may say that you would never hand your credit card over to a stranger and let them walk away but do you realize that every time you hand your credit card over to your waiter or waitress you’re doing just that. There’s implied safety because you’re at a legitimate restaurant but you need to realize that your server very well may be a crook.
The same thing applies to anyone you hand your credit card to, a cab driver, a department store employee, a bartender, anyone.
You’ve probably heard about skimming but I’m writing about it because the problem is getting worse and there’s probably a lot on the subject that you don’t know that could create opportunities for thieves.
Skimming is when someone steals the credit card information while you are making a legitimate transaction. It is typically an “inside job” by a dishonest employee of a legitimate merchant. The thief uses a small electronic device, called a skimmer, to swipe and store hundreds of credit card numbers.
Once they download the information onto their computer, they can sell the information on black-market forums; they can purchase things online, or even create new credit cards with your information using blank credit card stock and a credit card encoder.
The crook may have the skimmer attached to the belt around their waist, or lay it next to the cash register and then swipe your card twice, once thru the skimmer and once thru the stores computer system.
Restaurants are high risk because you hand your credit card over to your server and let them walk away with it. The skimming device is very small and fits in the palm of their hand, or it can be in their sock, or even their apron. It’s quick and easy for the server to skim your card and collect the data needed. If they’re working with a partner, they can even skim your card, have it duplicated, and start using the card to make purchases all before you’ve even left the restaurant.