2. About
• Plastic money or polymer money, made out of plastic
• It is a new and easier way of paying for goods and
services
• It include all types of plastic bank cards
3. BIRTH OF PLASTIC MONEY
• . Plastic money was introduced in the 1950s and is
now an essential form of ready money which reduces
the risk of handling a huge amount of cash
• Credit cards were invented 60 years back
• The Diners’ Club card, Introduced in New York City
in 1950, the card allowed Diners’ Club members to
eat at 27 restaurants in New York City on credit
4. Parties involved
• Cardholder: The holder of the card used to make a
purchase; the consumer
• Card-issuing bank: The financial institution or other
organization that issued the credit card to the cardholder.
• Acquiring bank: The financial institution accepting
payment for the products or services on behalf of the
merchant
• Merchant account: This could refer to the acquiring bank
or the independent sales organization, but in general is the
organization that the merchant deals with.
• Credit Card association: An association of card-issuing
banks such as Discover, Visa, MasterCard, American
Express, etc. that set transaction terms for merchants, card-
issuing banks, and acquiring banks.
5. Types of plastic money :
• Cash Card or ATM Card
• Credit cards
• Debit cards
• Prepaid cash card
• Charge cards
• Smart cards
• Global cards
• Diners Club cards
6. Cash Card or ATM Card
• A card that will allow you to withdraw money
directly from your bank via an Automated Teller
Machine (ATM) but it will not allow the holder to
purchase anything directly with it.
• Unlike a debit card, in-store purchases or refunds
with an ATM card can generally be made in person
only, as they require authentication through a
personal identification number or PIN. In other
words, ATM cards cannot be used at merchants
that only accept credit cards.
7. Credit Cards
• A credit card can be viewed as a payment
mechanism which enables the holder of the card
to purchase goods (or services) without parting
with immediate cash
• Customer has to make the payment at the end of
a specified period
9. Pre-paid Cash Cards
• As the name suggests the user will add credit to
the card themselves, and will not exceed that
amount. These are usually re-useable in that
they can be 'topped up' however some
• They provide some specials benefits or discounts
to the holder of the card.
• Pre-paid Cash Cards Examples:
• DMRC Smart Cards
• Pantaloons Green card
• Cards used in Food courts of Malls
10. Charge cards
A charge card carries all the features of credit cards.
However, after using a charge card you will have to
pay off the entire amount billed, by the due date . If
you fail to do so, you are likely to be considered a
defaulter and will usually have to pay up a steep late
payment charge.
11. Global cards
Global cards allow you the flexibility and convenience
of using a credit card rather than cash or travellers
checks while travelling abroad for either business or
personal reasons.
12. Diners Club card
• Diners Club is a branded charge card. There are a
wide variety of special privileges offered to the
Diners Club cardholder. For instance, as a cardholder
you can set your own spending limit. Besides, the
card has its own merchant establishment tie-ups and
does not depend on the network of MasterCard or
Visa.
13. How are they different?
Credit Card
• Borrowing money from a bank
or financial institution.
(Spending "other's" money)
• Need not be connected to any
bank account
• Pay additional interest drawn
on the amount borrowed
• Limit: Credit line
Debit Card
• Funds taken from the money
that you have in your bank
account. (Spending your
"own" money)
• Needs checking
Account/Savings Account
• No interest to be paid
• Limit: Equals your account
limit
14. Advantages of Plastic Money :
• Purchasing Power
• More convenient
• Extra Safety
• Credit Limits
• A need of emergencies
• Additional features
15. Disadvantages of Plastic Money :
• Complicated terms and conditions
• Less Global availability
• Worn out Magnetic strip
• Increased Debt and High Interest Rates
• Fraud
• Over Budget
16. • Remove black money from market
• Actual currency in circulation reduces
• Penetration increases impact on GDP and
consumption increases
• Cards reduces transactional and opportunity
cost
• Enhance economic growth
Conclusion
