JAIIB · RBWM

CREDIT CARDS AND DEBIT CARDS

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Retail Banking and Wealth Management — JAIIB.

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One-liners from this chapter

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What is the primary difference between a credit card and a debit card?

A credit card allows the holder to borrow funds up to a pre-approved limit, whereas a debit card directly draws funds from the cardholder's linked bank account.

What is a charge card and how does it differ from a credit card?

Charge card requires full payment each month, no revolving credit.

Which RBI circular governs the issuance and operation of credit cards in India?

RBI's Master Direction on Credit Card and Debit Card – Issuance and Conduct Directions, 2022 (updated) governs credit and debit card operations for banks and NBFCs.

What is the role of a card issuer in the credit card payment ecosystem?

Card issuer is the bank that provides the credit card to the customer.

What is the minimum interest-free credit period that banks must offer on credit cards?

Banks must offer a minimum interest-free (grace) period of 20 days and up to 50 days from the date of purchase to the payment due date on credit cards.

What is an acquirer bank in the context of card payment transactions?

Acquirer bank processes card payments on behalf of the merchant.

What does the term 'credit limit' mean in the context of credit cards?

Credit limit is the maximum outstanding balance a cardholder is permitted to carry on their credit card at any point in time, set by the issuing bank based on creditworthiness.

What is the purpose of an EMV chip on debit and credit cards?

EMV chip stores card data securely and prevents counterfeiting fraud.

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