CREDIT CARD GLOSSARY

Whether you are new to the credit card market place, or are already a credit card holder, the jargon can be quite daunting as there is no standardisation of terminology, but the following information guide below are some of the most common terms used:

STATEMENT DATE:
The date that the credit card company print a total make up of your indebtedness for that month's outstanding transactions and issue a statement. This need not be the date that you receive the statement.

INTRODUCTORY RATE:
In order to attract new business, credit card companies offer special introductory rates of interest to new customers. Introductory rates offered are usually 0% for a particular period of time. This period ranges from a few months to a year.

BALANCE TRANSFER:
Credit card companies offer introductory offers such as balance transfers which allow you to transfer balances from any other credit card and typically when you open a new credit card account.

ANNUAL PERCENTAGE RATE (APR):
This is the percentage rate of interest calculated on an annual basis. This is sometimes referred to as the ‘usual percentage rate' indicating that it is the rate that will be applied after an introductory offer period has expired.

CASH ADVANCE:
When you use a credit card account to obtain cash across the counter in a bank, or from a cash dispensing machine, etc.

CASH ADVANCE RATE:
A rate of interest charged for credit card transactions that involve the issue of cashfrom an atm or from a retailer. Typically, this form of interest is calculated from the date that you receive the cash rather than from the statement date.

CASH BACK:
Usually a reward scheme, where you are offered some financial rebate for transactions using your credit card. Cash back offers range from 0.1% to 2% of card purchases, but both the interest rate and the terms and conditions for cash back schemes vary significantly between card companies.

CREDIT LIMIT:
This will be the maximum amount of money that the credit card company will issue you and cannot be exceeded as long as a balance is owing on your credit card.

ANNUAL FEE:
Some credit card companies make an annual charge for a credit card. Sometimes called an administration charge. These are usually reward cards and not all credit card companies make this charge.

OVERSEAS TRANSACTIONS:
Most credit card companies levy a charge for the conversion between currencies. Ranging from a small percentage to a transaction which is typically independent of and additional to any interest rate applicable to a transaction, when you carry out a transaction in a foreign currency whilst abroad, or on the internet.

WITHDRAWAL LIMIT:
This is the maximum amount of cash advance that you will be allowed to withdraw, through an ATM (Automated Teller Machine ) or over the counter in a bank, on any one day.

MINIMUM PAYMENT:
This is the amount that you MUST pay back each month in order to keep your credit card account. Typically this will be expressed as a percentage of the statement balance and is the lowest amount you can pay.