Credit card are innovative ones in the line of financial services offered by commercial banks. The ides of credit card was first developed by a Bavarian Farmer, Franz Nesbitum Mc Namara, an American businessman who found himself without cash at a weekend resort founded Diner’s card in 1950. Right from that time, the commercial banks and non-banking companies in USA adopted the idea of credit card to develop their business. Barclays Bank was the first bank to introduce credit card in 1966 in Britain. The credit card business got momentum in sixties and a number of banks entered the field in a big way.

Credit card culture is a old hat in western countries. In India, it is relatively a new concept that is fast catching on. The present trend indicates that the coming years will witness a burgeoning growth of credit cards which will lead to a cashless society.

A credit card is a card or mechanism which enables cardholders to purchase goods, travel and dinner in a hotel without making immediate payments. The holders can use the credit card to get credit from banks up to 45 days. The credit card relieves the consumers from the botheration of catrying cash and ensures safety. It is a convenience of extended credit without formality. Thus credit card is a passport to “safety, convenience, prestige and credit”.

Credit cards are relatively new in India. Andhra bank and central Bank of India introduced credit cads in 1981. As of now there are more than a dozen major banks, India and foreign, which have entered this line of business, besides some non-banking institution. Since the plastic money has today become as good as legal tender more people are using them in their day-to-day activities.

Andhra Bank introduced Andhra Bancard in 1981 having linkage with VISA and Japan Credit Bureau International Cards. It has now a membership around 1,00,000 and member establishments round 5400 allover the country with annual billing is Rs. 120 crores.

Features of Andhra Bancard

• Open to non- account holders also.
• Individual are eligible who have 12,000 per annum income.
• Service charge is 2.5%
• The card is valid for two years and renewed thereafter periodically.
• Membership charge and annual subscription is according to prescribed rates.
• Fatal accident insurance is covered by air travel upto 50,000 for classic cardholders.
• It is tied up with world wide Master Card system.

The Central Bank issued Central Card in 1981. It has a membership of 1, 00,000 and member establishments around 10,000 with annual billing of Rs. 65 crores.

• It is for for those members who having saving and current account with sufficient balance.
• It is for the member with or without add-on facility.
• Free card is allowed only for three weeks.

Bank of Baroda introduced BOB Card in1985. Its membership is around 2.8 lakhs and member establishments are approximately 15,000. It has an annual transaction of about Rs. 120 crores.

• Open only for account holder with well conduced account for at least two years.
• Cash advance facility not exceeding Rs. 5,000 is allowed for a period of 15 days.

Canara Bank’s credit card (Can Card) was launched in August 1987.

• Can Card is issued to customers and non-customers also
• Cash withdrawals allowed upto 20% of the card limits.
• Valid for one years.
• Under the Can Comfort Scheme, Insurance cover against the risk of death for amount ranging from Rs. 10 lakh is available.

Bank of India introduced INDIA Card in 1988 and Taj Premium Card in 1990 in association with Taj Group of Hotels. These cards are affiliated to master Card International.

• Issued for holders having a well run account for about two years.
• The membership fee is Rs. 100 per annum plus services charge is 15%.
• Cash up to 3000 can be withdrawn .
• Free flight insurance coverage upto Rs. 1,00,000.