Definition Of Plastic Money
The plastic cards which are used everyday in place of actual bank notes is called Plastic Money. It is of different forms. Generally two forms of plastic card are used most: Credit Card & Debit Card.
Plastic Money is otherwise known as Polimer Money which was introduced in 1950. It enables the holder to avoid the risk of handling a huge amount of cash.
Forms Of Plastic Money or Plastic Card
What Is a Credit Card?
The plastic card which is used to make credit purchases of goods from authorised dealers is known as Credit Card.
The institution which issues the card makes the payment to the outlet, which should be repaid to the institution at a later date by the card holder.
What Is a Debit Card?
The plastic card that enables you to make purchases and make payments through swipe machines is known as Debit Card.
Generally it can be used only if the card holder has sufficient balance from which amount should be deducted online.
What Is a Charge Card?
The plastic card that enables its holders to pay off the entire amount billed by the due date is called Charge Card.
If its holder is to make payment before the due date he may be paid in the next billing statement with some late payment fees (2.95%).
What Is an Amex Card?
The plastic card which is specially need for high income group categories and companies is called an Amex Card.#It stands for American Express Card that enables its holder to use it as a Charge Card.
What Is a Global Card?
The special plastic card that enables its holder to use it as cash or travellers cheque by travelling abroad is called Global Card.
Generally it is more flexible and convenient to carry out financial transactions in foreign countries for a limited period of time.
What Is A Photo Card?
The debit Card or credit Card in which a photograph of the user is imprinted is known as a Photo Card.
Sometimes it is used as an identity card of its holder like PAN, Voter ID, Adhar Card, Driving Licence etc.
What Is a Smart Card?
The plastic card that contains an electronic cheap and enables its holder to make small purchases is called a smart card. Generally it doesn’t require any identification, signature or payment authorisation to make payment but the same is collected by smart card redeem machines.
Advantages Of Plastic Money
For the sake of clarification some of the important advantages of Plastic Money are discussed below:
Not Born Easily
The most important advantage of Plastic Money is it can’t be borned easily like paper, money etc. It can register at a higher temperature than paper & money.
Not Easily Mis-Used
The other advantages of Plastic Money is that it can’t be easily Mis-Used by anyone as it is protected by password. It also can be blocked by the user by informing the bank when it is lost.
The other important advantage of Plastic Money is that it is recognised as clean money in comparison to paper & money. Generally paper & money can be wasted more easily than plastic money.
Disadvantages Of Plastic Money
Though the Plastic Money has no of advantages it also suffers certain disadvantages such disadvantages are:
The plastic money is considered costly for its consumer. Generally the cost of plastic money is much more than other forms of credit, such as credits, line of credit, personal loan etc.
Damages Credit Rating
Another disadvantage of plastic money is that it damages the credit rating of customers. If it feels like payment in time. It also creates problems in getting financial assistants at the time of emergency.
High Bank Charges
The higher bank charges are yet considered as another disadvantage of plastic money. Generally the bank charges some extra money for service which approves 2.5% of the money spent.