Since the concept of using money was first introduced since ancient times to replace the barter trade system, importance and popularity of money went through a rapid growth. The role of money had currently evolved to the point that different country have own unique currency value, and most product are only purchase-able with money. Due to the risen role of money in human’s life, certain services regarding money to help human beings rose. Few examples of the services are bank deposit, withdrawal facility, debit services, and credit facilities. Credit facilities provide services that allow users to spend “future money”, which means the users would be able to enjoy the fruits before planting. Various choices of credit facilities are widely available in human’s life due to the high demands, easy profit, and its support in teaching one to learn managing daily finance.
There are many people who demand for the credit facilities due to its convenience. Credit cards is one of the credit facility services that widely accepted by users. By having at least a credit card, users can avoid the risk of holding excess cash which does not affect the usual purchasing rate. Besides, credit card users can also purchase extremely expensive item and only need to pay back by installment. Study shows that even 76% of undergraduate students from a college hold their own personal credit card (Federal Reserve Survey of Consumer Finances 2012).
Some businessmen love to provide credit facilities for its high and easy profit. For most of other types of business, profits are earned with trading of products or services with money. However, credit facilities such as money lending centre gain profits from interests of the loan. Therefore, unlike other types of busi...
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...ould always be concerned and balanced separately to prevent receiving more negative effects from it.
Works Cited
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Credit cards have a history stemming back to the mid 1900's, when there were two types of cards, both of which are still around, the card for specific stores, such as Sears, and the card for the occasional convenient spending when you didn't have the money you needed right away. The difference, however, between now and then is that only the extremely financially stable were using the latter of the two cards. The cards, such ...
Cliff A. Robb and Deanna L. Sharpe began their article “Effects of Personal Financial Knowledge on College Students’ Credit Card Behavior” with clarification regarding the study and also a succinct historical introduction to the ‘invasion’ of credit card companies on college campuses. Their study was based on the analysis of survey data composed from 6,520 students at a grand Midwestern University. This study revealed that financial knowledge was a compelling factor in the credit card decisions regarding college students.
Everywhere public place you go it is hard not to run in to the idea of the credit card. You will see credit card logos on the front of every business. Every department store you go in has it’s own version of a credit card from Target to Macy’s. The Diner’s Club Card that originally was only for businessmen to eat lunch at 27 different restaurants. Now it is accepted almost everywhere. And for everything else there’s Mastercard……(or Visa, Discover Card orAmerican Express.
In the Spring of 1949, Alfred Bloomingdale, Frank McNamara, and Ralph Snyder came up with a new plan for a modern type of credit card. While out to lunch one day in New York, the President of the New York Credit Card Company Frank McNamara had forgotten his wallet at home (Evans 53) . He had a thriving business yet credit cards at the time were only given to selected people. The first modern credit cards was introduced by Diners Club Inc. because of this. The modern day credit card is a small, plastic, rectangle, more than three inches. There is an account number and a name that is embroidered on the front. The first credit card did not look much like what credit cards look today. They were made out of paper not plastic, and they weren’t cards they were a lot like a tiny booklet that had all the same information the modern day credit card has now(Weiss 38). The modern day credit card can carry up to a $200 line of credit meaning you can buy anything you want at that certain time and pay it back at a later date such as months or a year after that time. Some companies require you to pay the full amount of your charge on the card at once, but some allow you to pay in small amounts. In order to apply for a credit card you must be at least eighteen years of age and if you are not you must have an adult sign the paperwork to apply for one. Prior ...
Ludlum, Mary, and Brittany Christine Smith. “The Credit Card Plague on the American College Campus: A Survey.” Mustang Journal of Law & Legal Studies 1 (2010): 72-76. Academic Search Complete. EBSCOhost. Web. 15 Nov. 2013.
Credit cards are something that are almost needed in everyday life now, as most dont have the money available to purchase a car or house and so need credit, thus needing credit cards to help build that credit. Those cards are hard to handle, and receiving applications in the mail daily, and commercials appearing on television don’t seem to make the struggle of staying away any easier. This starts to spark an interest. So people begin to think, "I think I 'm responsible enough to get a credit card, I 'll only use it for emergencies." Then the application process begins and it may take a couple times to finally be approved for one. This only makes it worse, of course, because realizing how long a credit card wasn’t applicable to life, but now
The explosion of credit card use among college students has woven itself into the fabric of campus life ultimately impacting how students interact and begin in the financial industry. As students gain more freedom away from home they often begin to experience various social changes. One area in particular that is cause for concern is the number of students incurring credit card debt. Due to growth in credit card usage and the rise of debt, the ideas discussed in this paper represent the growing need to evaluate credit card company solicitation efforts aimed at students and how to begin negotiation to amend these practices. Through mediation, the focus will be to investigate if college students receive ample education on credit and financial literacy. Concessions will be centered on finding a consensus solution that will work for the credit card industry and young consumer. Ultimately the negotiations seek to strike a balance that will create positive spending habits, implement a change in industry policy, and decrease the burden of debt that many college students find themselves in.
By offering consumers both a means to pay for goods and services and a source of credit to finance such purchases, credit cards have become the most widely used credit instrument in the United States. As a payment device, credit cards are a ready substitute for checks, cash, and debit cards for most types of purchases (Federal Reserve, 2013).
increasingly dominating the purchases of many American consumers. The concept of the credit card dates back to the late 1800's, while the modern credit card took form in 1966. Since then credit card use has exploded (Woolsey par.1-2). Today, over half of the United States' population owns at least two credit cards. The United States should become a cashless society because the government would ultimately save money, there is more convenience for consumers, and money related crimes would decrease dramatically.
Here are the most common reasons why people with money in their bank account may still use a credit card.
If we don 't have credit cards, we can’t build our credit history. If we don 't have a credit history, we aren 't allowed to buy cars or houses with low monthly payments. Having credit cards is a cycle in life because without one thing, we can 't have the other. When people have credit cards they have to use them. It doesn 't help that banks offer many credit cards to people, ending in high debt. Banks also encourage low monthly payments. If people pay low monthly payments, they will never end up paying their credit card debt off. They will probably end up paying for the objects they bought, two or three times. People aren 't forced to pay high monthly payments in order for it to take longer to pay the card off. If it takes longer for a person to pay a credit card debt, the credit card companies will be making a lot of money. I can definitely say I have experienced this because I am always offered to get a credit card. There are many stores that carry their own credit cards, and offer them for their customers. Offers are tempting and they can add to a future of credit card debt.
The lifestyle of people across the world is developing rapidly. As there is a growing concern for people about the lifestyle and way of living, the scope for the microfinance industry is also at a growing pace. A large number of people across the world prefer finance for the purpose of purchase of consumer durables as well as lifestyle products. As the credit card EMI options are more expensive, people prefer NBFCs for the purpose of consumer durable loans. The project done in bajaj finserv explains the role of NBFCs in the consumer durable loans and the procedure undertaken in order to disburse the consumer durable loans.
Access to capital and credit at various stages in the business life cycle is identified as the major hurdle by the entrepreneurs. For many small firms and most start-ups, the personal funds of the business owners and entrepreneur and those of relatives and acquaintances constitute as the major source of capital. For many small businesses, especially during the early years of their operation, credit is simply not available. For many others, the limited available credit is not through bank loans. Due to this many of them rely on multiple credit card balances and home equity loans as major sources of credit for start-up firm. Because banks are bound by laws and regulations to prudent lending standards that require them a risk management assessment for each loan made. These regulations were made more vigor during the late 1980'' and early 1990 . Banks always found that lending to manufacturing firm with hard asset such as property, equipment, and inventory has always been easier than lending to today's expanding service sector firms. Because the service sector firms own few hard asses, therefor lending judgment have to be based in terms of character, markets, and cashflow, which make it difficult to the bank to meet the regulations for the approval of the loan. Additional, the banking industry, as well as the entire financial sector of the
Banks are the largest Financial Institutions in Kenya and around the world. Commercial banks are financial institutions that provide financial services that include, issuing money in various forms, receiving deposits of money, lending money and processing transactions and the creation of credit (Campbell, 2007). Performance is the ultimate test of effectiveness of risk management. Performance and Activity of banks is greatly affected due to the exposure to different kinds of risks. Credit risk is the main risk that banks face and its one of the main sources of income in most commercial banks hence the management of the credit risk affects the performance of the banks.
...ower to wait a year or before to start to make the repayment. Somehow, some loans can be repaid at the end of the period instead of instalments. Besides, security, for example some assets and the properties of the business, is needed for the bank loan. There are three advantages in the bank loan. First, the timing and the amount of the repayment is known when getting the bank loan, so it is quite easy to budget. Second, there is also a repayment holiday, so the repayment schedule is quite flexibility. Third, the interest rates can be discussed and it can be lower than the overdraft. However, it is because the business loan is a long-term commitment, which is needed to service and this will be to high interest rate. Besides, security such as the house of the business owner is needed and this will not be good to the owner if the business is failed. (Cox, Fardon, 2009)