The Aditya Birla Group-SBI co-branded credit cards

The Aditya Birla Group and SBI Card has announced a partnership to offer co-branded credit cards to all customers of the Aditya Birla Group companies.

The Aditya Birla Group-SBI co-branded credit cards will be available to over 28-million customers of Aditya Birla Group companies--Aditya Birla Retail, Aditya Birla Financial Services Group (which includes Birla Sun Life Insurance and Birla Sun Life Mutual Funds), IDEA and Madura Garments. 

When Cards become Foes

The initiative will be led by the financial services arm of the Aditya Birla Group -- Aditya Birla Financial Services, the release said.

The Aditya Birla Group already has a strong presence in the financial services business, as a significant player in the non-bank space. The card will be made available across more than 2000 retail outlets of Aditya Birla Group companies.

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Check on high Credit Card Interest

High interest rate charged by credit card companies have caught the attention of law makers and they have set up a key Parliamentary Standing Committee.

The committee has suggested that all credit card charges levied by credit card companies should not be left at the discretion of banks, urging RBI to regulate the credit card market closely.

"The RBI should review this matter and re-formulate their guidelines or norms governing credit card services with a view to providing the much-needed relief to the general public," the committee said in its report.

Most credit card companies charge interest rates around 3 percent per month for a credit card which on annualizing comes out to be more than 40 percent.

In its report the committee notes: "Banks have been given complete freedom to charge any rate of interest regardless of their benchmark prime lending rates, thereby enabling them to charge exorbitant/usurious interest."

Do's and Dont's with your Credit Card

Credit card companies defend their stand of charging high interest rates by saying that credit is totally unsecured and therefore pose a greater risk to the credit card companies.

The recommendations of the committee are not mandatory but the government has to present an action taken report to justify its action in case it does not accept the recommendation.

Defaults in the credit card segment are over 15 percent for most lenders, highlighting the risk associated with the business. Risks are higher because companies depend on internal due diligence before giving out cards.

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Credit Card Default Settlement - Step by Step Guide

Here is how you have to deal with it. When you have queries on credit card defaults and delayed payments which has taken the payment obligation of the banker to few Lakh rupees.

Talk to the bank who issued the card and tell them you would like to settle off in good faith and ask for concession and negotiate hard, yes put all your negotiation skills to work here.

Once you both settle on some amount these are the steps you MUST and Should follow. It is better to negotiate with the bank itself rather than the collection agent because Bank Pays to the Collection Agent commission as high as 15% of the recovered amount and he will haress you until you pay it to the bank because the agent is awaiting his comission.

§         Get a letter from the bank in which they mention "Final Settlement of Outstanding dues" with your complete name, address and credit card number on which you have defaulted.                                                                                                      

§         Make your payment by CROSSED CHEQUE only

§         As soon as the payment is done, close this credit card account by giving writing instructions saying w.r.t Final Settlement, I have cleared all the dues and want this account to be closed. [Keep a proof of closing this account, say banker stamps on the second copy of the lettr or send it by registeredA.D]

• Preserve all this documentation for the next 5 years, atleast.
• Chances are the your name will be in the CIBIL defaulters list, give time of 6 months before you apply for another loan so that the bank clears your name off defaulters list.

§         Work and Plan your finances well before you opt for any other form of credit - card, personal Loan, auto loan etc

§         Next time when you apply for any kind of credit, if your name is still in the defaulters list, then you have every right to know on which account you have defaulted. If this is the same as the credit card account on which you have defaulted, then all those documents of Final Settlement, crossed Cheque payment will come in handy here. Attach attested photocopies and try to get your name cleared off the defaulters list. Don't submit the originals you have.

§         And finally you have to live with this painful process.

If Settlement Amount is as Large as Rs 300,000 [3 Lakh] ? Hire a lawyer because the deal is big and in any case save all the documentation.

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Getting higher limit in your Credit Card

There is a specified credit limit available on a credit card for a person. This limit is the amount till which a bank will allow an individual to spend on his/her card. The cardholder will have to ensure that the total amount of use on the card does not exceed this figure. There are also times when one would like to see the available credit limit increased so that higher spends are possible. Here is the manner in which this can be achieved depending upon the situation.

Natural increase

Credit card issuing banks continuously monitor the extent of the use of a credit card along with the payment habit of the cardholder. One of the ways in which a good record is built up is by ensuring that the various dealings with respect to the card are handled properly. A responsible behaviour which means making regular payments along with the regular use of the card that is near the overall limit will be one factor that will be monitored. Once there is an adequate record the bank is likely to offer a higher credit limit to the cardholder. The rise might not be very high as compared to the previous limit but just enough to ensure that there is a higher amount available for the cardholder to spend on his/her card.

Credit card customers must read fine print

Supporting documents

Often there is a situation where the individual has had a significant rise in the salary or there might even be a shift of jobs, which results in a higher pay coming in. This will also require a higher use of the credit card for which a higher limit is required. A way in which a higher limit can then be availed from the issuing bank is by supplying it with the necessary details. This will enable the bank to evaluate the existing position of the cardholder and after seeing a rise in the level of the income the lender is likely to give a higher credit limit on the card. This will help one in using the card better and will also suit the changed conditions that are now applicable.

Change card

There are times when the existing limit on a credit card remains very low. This could be because the card was issued long ago or that a particular bank is assigning a low credit amount for the person. In such a situation, there might not be any significant rise in the limit even though there are efforts to convince the existing bank. Here, there is a better alternative available for you. This would consist of changing the credit card or even the bank issuing the card. This will involve applying for a new credit card with the necessary details to the bank. This will ensure that the new card is then taken on the basis of the latest information, which will also mean that the limit is likely to be higher for this card while the older card with the other bank can be cancelled and given back. Another route is to upgrade the card that is held by you. This will mean moving from a gold card to a platinum card and this is possible when you fulfill the required conditions. Both these steps will also ensure that there is no rise in the number of credit cards that are carried around but at the same time there is an effective use made of the limit and this has been revised upwards.

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How to Resolve Unfair Credit Card Charges

You know the feeling. You open your monthly credit card statement to find the balance larger than you anticipated due to an unfair credit card charge. Whether the charge stems from the credit card company itself, or from a vendor, there are steps you can take to dispute and (often) reverse the fees. Instead of getting angry, get busy disputing those unfair credit card charges.

§         Save everything. This is an important step and you should follow it faithfully whenever you use your credit card. That means saving all your card receipts, at least until you know the merchant did not tack on additional charges. In addition, save the initial documentation that came with your new credit card by putting it into a folder. As long as that card is active, you must file that information.

• Catch errors early. As soon as you receive your statement, by email or snail mail, review it carefully. Don’t wait until the last day of the grace period before checking to make sure the charges are accurate.
• Call your credit card company with the intent of presenting your side of the story but not until you calm down. Credit card customer service agents are only doing a jog they were hired to do. They do not set policy but they may be able to reverse an unfair credit card charge. Chewing them out will not help your case.
• Compare your credit card charges with your receipts. If a different amount was charged by the merchant, you will probably get a refund quickly as long as you can send a scanned copy of the receipt to the credit card company. The online customer service representative will give you the mailing address or it will appear on your statement.
• Know what types of unfair charges you may dispute.  If you find unauthorized charges, charges with the wrong date, charges with incorrect amounts, you should be reimbursed for all of these.

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Credit cards can cause Swine Flu

Whether you’re worried about catching a seasonal cold or something more drastic like the worldwide panic over the H1N1 flu virus, you might want to rethink how you use your credit cards if you plan to stay healthy. You probably haven’t really thought about it, but the truth is that your credit cards can make you sick!

How Credit Cards Might Make You Sick

Credit cards aren’t special. There’s no deep dark secret behind them when it comes to your health. It’s just common sense. The more people that touch something, the bigger the risk there is of germs being present. Chances are that you aren’t the only person touching your credit cards (not to mention other items involved in your credit card transactions). You can take steps to be more cautious though, cutting down on your risks.

How to Stay Healthy When Using Your Credit Cards

Here are several things you can do to avoid getting sick when using credit cards:

1. Swipe your credit card yourself. — Don’t let other people handle your credit cards unless absolutely necessary. If you can swipe or scan the card yourself, do it.

2. Carry your own pen. — If you’ll have to sign for purchases, carry your own pen. You have no idea how many other people (ill or not) have handled a store pen before you.

3. Avoid directly touching key pads. — If you instead have to enter a PIN, try not to actually touch the key pad with your bear hands. Use the pen you brought, a napkin, or something else. Many people have probably used that touch pad before you during the day, and they could have left germs behind. 

4. Shop online. — If you’re aware of a particular outbreak in your area, you might want to avoid crowded public places like stores as much as possible. You can do that and decrease your risks by doing some of your shopping online (a situation where your credit card actually protects your health).

5. Wash your hands. — If you must handle your credit cards, wash your hands as soon as possible afterwards. That way you’ll at least minimise your risk of transferring any germs from the card to your mouth or nose by way of your hands.

Simple changes in how you use your credit cards can make a big difference in keeping yourself healthy all year long, even when people aren’t worried about a specific medical outbreak. The only thing that should make you “sick” when using credit cards is the thought of paying high fees or interest. Exercise common sense and basic hygiene and you’ll keep yourself safer.

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Credit Score Ratings by CIBIL

Credit report contains information about all the loans and credit cards that a customer has and some other details like:

§         Personal identification details like name, address, pan no, passport and driving license.

§         The repayment status of the account

§         Details of all the closed accounts

§         No of enquiries made by member banks

§         Amount overdue

Depending upon the payment track record of all the current as well as closed accounts that a customer has CIBIL gives rating to every individual in forms of score. It ranges between 100-900 and is a 3 digit code which shows the position of the borrower in terms of making the payments, may it be for a card or for a loan and any other facility obtained. CIBIL ratings are given on the basis of score of an individual.

CIBIL Credit Score Range

It further is divided into 3 broad categories; excellent, good, poor and fair. We can also say that CIBIL scoring id divided into three categories:

      »  High Score

      »  Low Score

      »  No or Zero Score

§         When a customer’s account is clean as he has been regular in making all his payments, there is no amount overdue in any of the loan and there has been no bounce or settlement in the closed accounts too, his CIBIL score would be high.

§         If the borrower has been a non performer with amount outstanding any of his account and also has settlement with member banks on his accounts, it means that he is not a good customer and his CIBIL score is going to be low.

§         If you have taken no loan till and there are no matches in your report for a credit facility, your score will be Zero.

*How to lodge Credit Card Complaint

 

Let us understand what does an excellent, good, poor and fair CIBIL ratings signify:

§         If the score given to you by credit bureau is in between 751-900, it is considered to be very high and your rating is excellent.

§         Anything between 700-750 is high and the rating is good.

§         If it is less than 700 and 500 it is considered to be average in case of 700 and very low for 500 and below. Similarly the CIBIL ratings go on like fair and poor if the score is less than 500.

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How to remove Credit Card Defaulter's name from CIBIL Report

Cibil credit card amounts write off is a condition, which happens after continuous 180 days of default of your credit card dues. Banks write offs your credit card account if you do not make the payment, which is due on your card for 6 months.

However, you will still keep on receiving calls from the collection agency but the account is written is a write off account. It indicates the bad history of a borrower and it stays in your credit report for 7 years according to the rules.

*Credit Card Default - Costs 7 year punishment

Here is how you can remove a credit card write off from your cibil report:

• Well, a write off stays in your credit report for 7 years; but the banks have the power to upgrade any debt three times every seven years and this means that it can actually stay in your credit report for complete 21 years. But there is a way out to this and one can improve his/her cibil report by getting rid of this.

*Credit Default Settlement - Step by Step Guide

• The moment you figure that you have a write off account in your credit report, you must immediately contact your lender. Your lender would surely help you if you are showing interest in making the payment and would not treat you badly or as a bad customer. Get the total amount due on you r card calculated with the help of your lender.
• You may require presenting the last monthly bill statements received and some other details of your credit card. Follow the instructions and give proper details needed. Your bank will now give the exact figure of amount that you owe to the bank.
• Pay this amount and get a no due certificate or payment receipt from your lender. The process is not over yet. You will now have to call up your bank again and request them to update about the full and final payment to the credit bureau. You bank will now update this to cibil and within a span of 40 days, the write off will get cleared from your cibil report and the account would be shown as a normal closed account.
• You can contact Cibil directly also, if your bank does not co operate in updating the status to cibil and tell them about your settlement by showing the payment receipt. After some clarifications and enquiries from the lender, the credit bureau will update the same in your report and your report will be clean.

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Features of CIBIL Credit Report

The Main Features Of Credit Report Are

• Personnel Information - Name, current residential address and company’s address in case of a firm.
• Pan Card Number, Driving License Number, Passport Number and Voters Id Number.
• Date of Birth and Date of Incorporation of the firm.
• Information about all the credit facilities availed by the borrower from any of the member institutions. This includes details for all the loans, credit cards etc.
• Repayment status of all the current accounts as well as closed accounts.
• Default details if any in any of the account.
• Amount overdue on a particular account.
• No of enquiries made by the member banks in past 12 months.

You can see now how the credit history is reflected in the cibil report. It contains all the information that is mentioned in the features of the report.

How to apply for Credit Card

You can not check your cibil report directly. Credit Bureau does not provide a credit report to any individual and only member institutions can view your report, but here are some ways by which you can have a access to your report.

    1.    If you have applied for a loan or credit card with any of the member banks of cibil, then you can approach them to send you a copy of your credit report. You can also go and collect a copy from the bank on your own.

    2.    You can apply for a credit facility from any of the bank which is a member of cibil. The bank will get your credit reportgenerated to know the recent and current status of your payment record. You can now ask the lender to give a copy of this report to you.

    3.    You can take the 9 digit control number from the bank in which you have submitted your loan application and approach cibil by calling up on the help desk number and ask for the information.


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Credit Card Payment Due Date

According to a senior banking ombudsman official, card customers are “unofficially’’ given “a grace period’’ of about three days after their due date if they choose to make a cheque payment, to allow the amount to get credited into their account. In other words, no late-payment charges are levied. 

In sharp contrast, heads of leading card-issuing banks say their terms and conditions, bill statements and websites clearly mention that cheque payment must be made three to five days (in case of outstation cheques) before the due date so that it comfortably reaches their account by the deadline.

Now, suppose there is a string of bank holidays and weekends between cheque deposit and its clearance. If a cheque does not get cleared for reasons over which a consumer has no control, he/ she would still end up paying penal charges.

A senior Mumbai banker admits that due date-related disputes are common and consumers have been demanding clarity on the issue. K Unnikrishnan, deputy chief executive, Indian Banks’ Association, seconds that there is a need to bring in uniformity in cheque deposit norms with reference to due date.

Till the time banks come up with clear guidelines, customers are advised to pay way ahead of the stated due date. Besides, if they end up paying closer to the payment deadline, they must avoid depositing their cheques in drop boxes.

As mentioned earlier, the Reserve Bank of India rules specify that banks must accept all cheques at counters and provide an acknowledgment receipt to the customer. This would serve as a proof of deposit in case of a dispute, if any.

Alternatively, banks are increasingly introducing “cheque deposit machines, which work like a screener and give you a receipt, which is a replica of your cheque with all the details,’’ says a bank executive. Other than the convenience of not having to queue up at a counter, they provide the relevant proof. Consumers must know that dispute resolution relies on documentary evidence.

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Credit Card Protection Tips

Don't have enough cash in hand to buy the latest Coby MP4 Player that you always wanted to? No problem. Use one of the several credit cards that you own from various abanks.

Of course using a credit card to buy goods and services you desire is indeed the most convenient way of shopping for millions of Indians, more so during the festive season, there are a few things you should know before you actually do that.

Remember that a credit card is an unsecured loan advanced by a bank or financial institution after ensuring that only those who meet certain credit parameters are qualified to use the credit card.

Here are a few MUST KNOWs before you start using your credit cards.

1. Always read the terms and conditions before using the credit card because once you use the credit card it is assumed that you have accepted the same.

2. A card is usually issued for two years and the annual fee is waived off only for the first year. The second year fee is usually charged and if you do not wish to pay this fee, you should cancel the card before using it in he second year because using it indicates that you have agreed to paying the second year's subscription.

3. 'Lifetime free credit cards' is a new trend in the industry and before opting for one you should check with the bank if all annual fees are indeed being waived off.

4. Always try and pay the entire amount outstanding to the extent possible because all unpaid amounts carry a hefty interest and turns out to be very expensive if you decide to roll your credit.

5. Whenever you make a large purchase on your credit card you will be given an option to pay by EMI (equated monthly installments). It is recommended that you pay the entireamount at the extent possible and avoid the EMI route as it is prohibitively expensive.

6. Avoid borrowing cash on credit card as it turns out to be very expensive because of the interest amount charged. Different banks levy different interest rates on cash borrowed on your credit card. Please ask your credit card issuing bank or company about the interest charged on such transactions.

7. Never choose a credit card for its insurance cover but for its core offering, that is, more than 50 days of interest free credit if you use it smartly.

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How to apply for a Credit Card

• Find out information about credit card plans, rates and terms on the Internet, in personal finance magazines and in newspapers.
• Fill out the paper application for a credit card of your choice, if you do not want to apply online. Ensure that the application is endorsed by the credit card company and is an original document, not photocopied.
• Apply on phone, by calling up the toll free number of the credit card company of your choice. This number can be found online, through yellow pages, newspapers or magazines. Follow the automatic instructions that you hear when you call the number.
• Apply online, which is usually the easiest, fastest and most preferred method of credit card application. Go online and search for the different credit card options offered by different banks, financial institutions and stores.

More on Credit card application

• Compare the different features as regards the fixed or fluctuating interest rates, APR, credit limits, interest-free days, penalties, grace periods, schemes for cash advances and balance transfers, attractive offers and other implied costs.
• Choose one to suit your requirements and search for applying options online.
• Check for the preconditions of applying, such as a driving license number, social security number, date of birth and address proof. Usually, there is no need to have a bank account in a specific bank, nor do you need to maintain a minimum bank balance.
• Fill in the details, double check the information included, read the privacy statement and click on "Apply."
• Apply for multiple credit cards if you choose. However, the authority to issue of all these cards simultaneously rests with the issuer, who will first ensure whether you have a reliable financial background.

which Credit Card to apply?

SBI - Spicejet Cobranded Card

Budget air-carrier, SpiceJet and public sector lender, State Bank of India, today launched their co-branded credit card SBI SpiceJet which offers a host of benefits to the airline's customers.

The offering under the credit card includes an absolutely free SpiceJet air ticket (inclusive of all taxes and surcharge and valid across all sectors and flights), a company press release said here.

A completely free SpiceJet air ticket on enrolment to the SBI SpiceJet Card and completely free SpiceJet air ticket on spends above Rs 1 lakh in a year, are some other benefits that a card-holder can avail, the release said.

The free air ticket is also inclusive of all taxes and surcharge, it said.

Besides, a customer would also be entitled to a Rs 1,000 SpiceJet discount voucher on enrolment to the SBI SpiceJet Card, which is redeemable against a SpiceJet return air ticket, the release aid.

We are pleased to introduce these new benefits for our SBI SpiceJet customers. Bringing new products that offer greater value to our customers has been an ongoing endeavour for us at SBI Card," SBI Card CEO, Diwakar Gupta," said.

This association with SBI card is yet another innovative step towards that and the airline is sure that its customers would find this to be meaningful for them, SpiceJet CEO, Sanjay Aggarwal, said.

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Credit Card Information for Sale

While the global economic turmoil is forcing Governments to initiate measures to arrest further decline in growth rates, cyber crooks operating in the underground economy seem to be cashing in on the opportunity.

Wondering how? With shopping and banking transactions occurring online, password stealing has, for instance, become a common cyber crime. McAfee Avert Labs has seen the count of password stealing malware variants increase by nearly 400 per cent during 2007-08.

Symantec’s Report on the Underground Economy reveals that the most frequently advertised item on underground economy servers are bank account credentials (which consist of account numbers and authentication information) accounting for 18 per cent of goods and services available for sale.

The large supply of bank account credentials may be due to a shift towards online banking.

Forty four per cent of Internet users perform some degree of Internet banking in the US, it is higher at 67 per cent in Canada. It has just caught on in India. According to the report, the advertised prices for bank account credentials ranged from $10 to $1,000 (between July 2007-June 2008), with prices depending on the amount of funds available, the location and type of account.

The second most common advertised item was credit card numbers accompanied by CVV2 numbers, accounting for 16 per cent of the sale of all advertised goods and services. (Merchants at many online sites require the CVV2 number as part of their authorisation process and the number of sites requiring this authentication is increasing.)

The Report said credit cards with CVV2 numbers were typically sold in bulk, with packages ranging in size from 5 to 500. The advertised prices of these ranged between $0.50 and $12.

The third most common item advertised for sale on underground economy servers was credit cards, accounting for 13 per cent of all advertised goods during the reporting period. Symantec perceives credit cards as not being as popular as bank account credentials or credit card numbers possibly because these are difficult to exploit due to the time-sensitive nature of the stolen cards and increased security measures taken by merchants.

Credit card prices observed on the underground economy servers ranged from $0.10 to $25 per card number. Symantec estimates the value of the total advertised goods on observed underground economy servers at over $276 million during the said period.

While law enforcement agencies strive to arrest and indict those involved in frauds and identity theft, the global nature of these criminal enterprises is making it increasingly difficult to locate their operations and shut them down.

This is just the tip of the iceberg. Cyber criminals are on the prowl, looking for newer ways to make money. So, keep your identity and wallet safe by adopting security safeguards.

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