Credit Card Types and Top-up Methods

Credit Card Types

• Standard Credit Cards

  • Basic credit card with a credit limit.
  • Widely accepted for purchases.

• Rewards Credit Cards

  • Earn points, cashback, or miles on purchases.
  • Benefits vary by spending categories.

• Secured Credit Cards

  • Requires a cash deposit as collateral.
  • Suitable for building or rebuilding credit.

• Student Credit Cards

  • Designed for college students with limited credit history.
  • Often have lower credit limits.

• Business Credit Cards

  • Tailored for business expenses.
  • Features like expense tracking and employee cards.

• Charge Cards

  • Must be paid in full each month.
  • No preset spending limit but strict payment terms.

Top-up Methods

• Direct Deposit

  • Funds added automatically from a bank account to the credit card.

• Bank Transfer

  • Transfer funds electronically from a checking or savings account.

• Cash Payments

  • Deposit cash at ATMs or bank branches.

• Mobile Payments

  • Add funds using mobile payment applications linked to the card.

• Reloadable Prepaid Cards

  • Specific type of card that can be topped up as needed.

Credit Limits

• Definition

  • The maximum amount a credit cardholder can borrow on their card.

• Factors Influencing Credit Limits

  • Creditworthiness (credit score).
  • Income level and debt-to-income ratio.
  • Payment history with the issuing bank.

• Types of Credit Limits

  • Initial Limit: Set when opening the account.
  • Available Credit: Remaining credit limit after purchases.
  • Cash Advance Limit: Specific limit on cash advances, often lower than the total limit.

• Limit Adjustments

  • May be increased periodically based on spending patterns and payment behavior.
  • Cardholders can request an increase or decrease as needed.

Credit Card Types

• Standard Credit Cards are basic cards with a credit limit, widely accepted for purchases.
• Rewards Credit Cards offer points, cashback, or miles on purchases, with benefits varying by spending categories.
• Secured Credit Cards require a cash deposit as collateral and are suitable for building or rebuilding credit.
• Student Credit Cards are designed for college students with limited credit history, often with lower credit limits.
• Business Credit Cards are tailored for business expenses, featuring expense tracking and employee cards.
• Charge Cards must be paid in full each month and have no preset spending limit but strict payment terms.

Top-up Methods

• Direct Deposit adds funds automatically from a bank account to the credit card.
• Bank Transfer transfers funds electronically from a checking or savings account.
• Cash Payments allow depositing cash at ATMs or bank branches.
• Mobile Payments add funds using mobile payment applications linked to the card.
• Reloadable Prepaid Cards are a specific type of card that can be topped up as needed.

Credit Limits

• Definition: The maximum amount a credit cardholder can borrow on their card.
• Factors Influencing Credit Limits include creditworthiness (credit score), income level and debt-to-income ratio, and payment history with the issuing bank.
• Types of Credit Limits:
  • Initial Limit: Set when opening the account.
  • Available Credit: Remaining credit limit after purchases.
  • Cash Advance Limit: Specific limit on cash advances, often lower than the total limit.
• Limit Adjustments: May be increased periodically based on spending patterns and payment behavior. Cardholders can request an increase or decrease as needed.

This quiz explores different types of credit cards including standard, rewards, secured, student, business, and charge cards. Additionally, it covers various top-up methods such as direct deposit, bank transfer, and cash payments. Test your knowledge on the intricacies of credit cards and their functionalities.