Payment Card is a card for cashless payments at retailers, internet stores or for cash withdrawals at ATMs. The payment card gets the customer (the cardholder) from the card issuer - usually from a bank, but also from various financial institutions, department stores, loan companies, telecommunications, utility and airline companies. Card issuers may issue them based on the license of some of the associations who have an agreement with the merchants of accepting cards, and they also arrange the payment settlement to the issuer. World’s largest associations of card issuers are:
- VISA (USA, UK)
- MasterCard (USA)
- American Express (USA)
- Diners Club (USA)
- Discover Financial (USA)
- JCB Card (Japan)
Cards expansion, issued by individual associations, varies in different states - each state has different coverage of ATMs and points of sale-brand cards. In some states it is possible to pay with all brands of cards, while somewhere are very significant disproportions.
What types of payment cards do we have?
Payment cards exist is many different types, the most common types of payment cards are:
- Debit Cards
- Credit Cards
- Charge Cards
- Prepaid Cards
- Shopping Credit Cards
- Business travel cards
- Purchasing cards
All credit cards may be issued either as the embossed payment cards or as non-embossed cards (can’t be read on non-electronic terminals). As a protection technology and carrier information on the card is either a magnetic stripe or chip technology. Recently, more hybrid cards are issued.
How business can use payment card in practice?
Payment card can be used for payment at a merchant in store or on the internet, or for the withdrawal at an ATM. The advantage of payment cards is minimizing the risks associated with holding cash and payment option without having to carry around enough cash. On the other hand, an organization can take advantage of payment cards for payments from its customers. A trader who receives a payment with the card pays a percentage to the card issuer (or issuing association). Their advantage is the use in international trade.
Each payment card must contain the following particulars:
- Identification of the issuer
- Name or identification of card holder
- Payment card number
- The validity of the payment card
- Data on the magnetic strip or microchip