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Dual facility on single card

Of various types of cards available in the market, the two most common are debit cards and credit cards. They have their unique features. Arnav Pandya tells more.

business Updated: Sep 16, 2008 21:11 IST

Of various types of cards available in the market, the two most common are debit cards and credit cards. They have their unique features. While the debit card allows an individual to use the fund available in his bank account, credit card offers a line of credit to the user. This credit amount has to be paid back within a specified time period.

Single card option
Often, people use both these cards to suit their needs and this requires them to carry multiple cards on their person. However, a single card with both the debit and credit features is likely to be introduced soon.

Responsibility
When there is just a single card to act as both a debit card and a credit card one has to be clear about the implications of using either of the cards.

As the same card will be swiped at required places, the cardholder will have to intimate the bank about the nature of the use of the card. This will make participation from cardholders important and will also require their regular attention.

Default option
The most important part of the entire working could be the default option. The cardholder will have to intimate the bank about the default option on the card. Once this is done, in case there is no intimation from the cardholder, the bank will put the expense on the default option selected.

Otherwise, there will be a specified time period available to the cardholder to intimate the bank about the option that they want to use. This can be done through options provided by the bank and there will be a mechanism for the bank to intimate the user about the expense made on the card and the option they want to exercise. Looking at the present situation, the cardholder will not be able to do make the decision at the point of making the expense.

Selection
This makes the selection of the route of payment important. The cardholder will have to be alert about his position when making the choice.

An individual can choose the often-used mode of card as his default option and intimate the bank only when he wants to exercise the other option. This is important because there can be interest charges on the credit card that might start piling up if this is used and the amount is not paid back by the due date. At the same time other payments also need to be considered, else the cheques might bounce.

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