Work - Economics - domestic and international payments technique

To Work Pages Dorin M

Economics

Translation draft

Card (Bank card)

Bank cards (debit / credit cards) were first issued in the United States (in 1920) by department stores, hotel chains, oil companies, and so on. for customer loyalty (or for "customer club" reasons) by providing their owners with various payment facilities. Their success has led to an increase in the services and operations included in these bank cards, with banks perfecting this system by introducing multi-use cards and then, due to the infusion of these payment instruments on all continents, imposed standardization.

This standardization appeared both from a technical point of view, the card becoming a plastic card - standard size, 85 x 55 mm (hence the name plastic money) in the format of a business card, with the issuer's logo printed ( generally a bank), the name of the card type, the logo, the hologram and the code of the issuer, together with a series of data to identify the holder, customer of the respective bank, as well as its expiration date.

This card also includes magnetic inserts (tapes, chips), etc. which make it very easy and efficient to manipulate it by means of electronic devices (hence the name of electronic money) by its holder for the purpose of making payments / receipts (payment / debit card) but also for the purpose of obtaining loans on short term (credit card).

The NBR established a regulation on the principles and organization of card payments by banking companies - Regulation 6 of 14 November 1995.

In reality, the card is only a modern variant of payment by check (if in the case of payment by check a check sheet is signed which will be cashed on time or at sight, in case of payment by card it is mandated by using the card or a invoice through the same payment transaction), a normal evolution towards increasing the usefulness and efficiency, currently the different types of cards, of international circulation or not, tending to replace cash and check in almost all types of payments, their implementation being dependent only the introduction of card transaction processing centers.

The outstanding efficiency of this payment instrument is represented by the electronic technology on which its use is based, the electronic funds transfer at the point of sale (EFTPOS), the settlement of the transaction being possible by simply using the facilities of " intelligence "/" smart card "of the card in an online processing system.

Another special advantage of cards is the almost universal introduction of credit card facilities (credit card), initially "attached" only to a certain type of service but, through the evolution of services, becoming almost generally used.

This option gives the holder the right to obtain a loan from the issuing bank, through a regular settlement, usually monthly, with the issuing bank (called off-line system), through which he can benefit from additional amounts to the real account (up to a certain amount). Attractive is the solution of not charging interest for this loan with the obligation to settle the debts within one month (otherwise proceeding to charge interest).

The banking practice has established four levels of cards: withdrawal, for payment to affiliated merchants, external cards (for domestic and international use) and prestigious cards featuring special insurance and assistance services.

Three participants are involved in card transactions:

- cardholder (beneficiary), holder or not of an account with the issuing bank;
- the issuing bank, which manages and operates the payments in the current bank accounts of the beneficiaries;
- merchants, who accept payment by card.

The card payment mechanism is based on two contractual premises: the adherent contract concluded between the consumer and the card issuer and the supplier contract concluded between the issuer and the merchant who agrees to be paid through this mechanism. These are membership contracts with clauses set by the card issuer, so the terms of acceptance are non-negotiable.

In conclusion, the advantages of card users are represented by the increased security of use of own funds (by eliminating the use of cash, the possibility to benefit from credits as well as the possibility to benefit from additional services (depending on the type of card). by providing various facilities, it will also benefit from the security of card transactions and, in fact, will benefit from increases in fees, interest, etc., similar to any current banking operations.

The main advantages of using cards will be found especially at the level of merchants. They will be able to increase the number of customers and the volume of sales due to the increased security of simple and convenient payment operations and procedures, as well as the possibility to offer various benefits to card users.

The disadvantages are the possible fraudulent use of lost or stolen cards when their loss is not immediately reported, as well as the possibility that accepted card users may use funds well above the limits accepted by the owner.

In order to be able to "view" the banking system in the form of cards on the Romanian market, you can view the page "Cards for individuals" as well as "Cards for legal entities" where you will find additional details related to banking services related to these cards, credit opportunities, etc.


Dorin, Merticaru