A

Seminar Report
(Subject Code: 536321)

Submitted in the partial fulfillment for the

award

of degree of

MASTER OF BUSINESS ADMINISTRATION

(MBA)

ofChhattisgarh Swami Vivekanand Technical

University

Bhilai (C.G.)

Session 2009-11

Guided by : Submitted
by:

Name of Faculty Nupur

Agrawal

Designation Roll
No……

3 |Page
 Enrollment
No……….

MBA - III Sem.

Sec.
- “A”

DEPARTMENT OF
MANAGEMENT

DISHA INSTITUTE OF MANAGEMENT

AND TECHNOLOGY

(Disha Education Society)

Satya Vihar, Vidhansabha-Chandrakhuri Marg, Mandir

Hasaud,

Raipur (C.G.)492007

4 |Page
 CERTIFICATE

This is to certify that Miss. NupurAgrawal of DIMAT, MBA Semester –III has successfully
completed the Seminar Report in partial fulfillment of requirement for the award of MBA
Degree prescribed by the Chhattisgarh Swami Vivekananda Technical University,
Bhillai.

This report is the record of authentic work carried out by the student during the academic
year 2009-11

Prof. Dr. Sathish Benedict

Internal Guide Academic Head

(Faculty of Management) (Faculty of Management)

5 |Page
 DECLARATION

I, Miss. Nupur Agrawal hereby declare that this seminar report is the record of authentic
work carried out by me during the academic year 2009-2010

( )

Signature of the student

(Nupur Agrawal)

Name of the student

6 |Page
 ACKNOWLEDGMENT

The report on Customers’ perception towards SBI credit cards in Raipur city has been
given to me as part of SEMINAR REPORT in 2-Years Masters Degree of
Business Administration

I have tried my best to present this information as clearly as possible using

basic terms that I hope will be comprehended by the widest spectrum of
researchers, analysts and students for further studies.
The successful completion of any project requires guidance and help from number of
people.

This project report could not have been completed without the guidance of

Prof………..

In the end, I would also like to thank all faculty members, customer and all those
whose names are not mentioned above and who have indirectly helped me in various
ways in successfully carrying out the project.

7 |Page
 Nupur Agrawal

CHAPTER -1
INTRODUCTION

8 |Page
INTRODUCTION
A Credit Card System is a type of retail transaction settlement
through credit system, named after the small plastic card issued to
the users of the system. A credit card is different from a debit card.
In this, the credit card issuer lends the consumer money, rather
than having the money removed from his account. A credit card
allows the consumer to revolve their balance, at the cost of having
interest charged. Most credit cards are of the same shape and size
as specified by the ISO 7801 standards.
The plastic
credit card with a magnetic strip carried by a number of people
nowadays in their wallets is the end result of a complex banking
process. Holders of a valid credit card have the authorization to
purchase goods and services up to a predetermined amount, called
a credit limit. The vendor receives essential credit card information
from the card holder, the bank issuing the card actually reimburses
the vendor, and eventually the card holder repays the bank through
regular monthly payments. If the entire balance is not paid in full,
the credit card issuer can legally charge interest fees on the unpaid
portion.

9 |Page
History
The credit card was the successor of the variety of merchant credit
schemes. It was first used in the 1920s in the united states,
specifically to sell fuel to a growing number of automobile owners.
In 1938 several companies started to accept other companies’
cards.
The concept of paying merchants using a card was invented in 1950
by FRANKX MC NARAMA in order to consolidate multiple cards.
The Diners’ club produced the first charge card, which is similar
but required the entire bill to be paid with each statement. It was
followed shortly thereafter by American Express.
Bank Of America created the BANKAMERICARD in 1958, A
product which eventually evolved into the VISA system. (CHARGEX
also became VISA). Master Card came into being in 1966 when a
group of credit issuing banks established Master charge. The
fractured nature of US banking system meant that credit cards
became an effective way for those who were travelling around the
country to move their credit to places where they could not directly
use their banking facilities.
There are now countless variations on the basic concept of
revolving credits for individuals (as issued by banks and honored by
a network of financial institutions), including organization-
branded-credit cards, corporate user credit cards, store cards and
so on.

10 | P a g e
In contrast, although having reached very high adoption levels in
the US, Canada & UK, It is important to note that in other cultures
which were much more cash oriented in the latter half of the
twentieth century such as Germany, France, Switzerland and many
others, take-off of credit cards was initially much slower. It took
until the 1990s to reach anything like the percentage market-
penetration levels achieved in the US, Canada & UK. In many
countries acceptance still remains poor as the use of the credit card
system depends on the banking system being perceived as reliable.
In contrast because of the legislative framework surrounding
banking system overdrafts, France in particular, were much faster
to develop and adopt chip based credit cards which are now seen as
major anti-fraud credit devices.

THE MERCHANTS’ SIDE

For merchants, a credit card transaction is often more secure than
other modes of payment, such as Cheques , because the issuing
bank commits to pay the merchant, the moment the transaction is
verified. The bank charges a commission to the merchant for these
services and there may be a certain delay before the agreed
payment is received by the merchant. In addition, a merchant may
be penalized or have their ability to receive payment using that
credit card restricted if there are too many cancellations or
reversals of charges.

11 | P a g e
SECURED CREDIT CARDS
A secured credit card is a type of credit card secured by a deposit
account hold by the card holder. Typically, the cardholder must
deposit between 100% to 200% of the total amount of credit
desired. Thus if the cardholder puts down an amount of $1000, he
or she will be given a credit in the range of $500 to $1000. This
deposit is held in a special saving account. The card holder of a
secured credit card is still expected to make regular payments, as
he or she would with a regular credit card, but should he or she
default on a payment, the card issuer has an option of recovering
the cost of purchases paid to the merchants out of the deposits.
Often though if the card holder does not make the required
payment, many issuers of secured credit cards consider that the
account must be cleared before the security is released instead of
using the security to pay the balance due. The card is not cancelled,
the balance is not set off the deposit, and the interest continues to
accumulate on the unpaid balance for considerable periods of time.
In some cases, the original charges may far exceed the original
deposit and the card holder not only loses it’s deposit but is only
left with an additional debt. Most of these conditions are usually
described on a cardholder agreement which the cardholder signs
when their account is opened. Secured credit cards are an option to
allow a person with a poor credit history or no credit history to
have a credit card which might not otherwise be available. They are
often offered as a means of rebuilding one’s credits. Security Credit
cards are available with both VISA and Mastercards logos on them.
Fees and service charges for secured credit cards often exceed
those charged for ordinary non-secured credit cards
12 | P a g e
.

FEATURES
The credit cards offer consumers an easy way to track expenses, the
credit can be accessible anywhere very conveniently, which is
necessary both for monitoring personal expenditures and the
tracking of work related expenses for taxation and reimbursement
purposes. They have now spread worldwide and are offered in a
huge variety of permutations with differing credit limits, repayment
arrangements ( some cards offer interest free periods, while others
do not but compensate with much lower interest rates), and other
perks ( such as reward schemes in which points earned by
purchasing goods with the card can be redeemed for further goods
and services). Some countries in the US and UK limit the amount
for which a consumer can be held liable due to fraudulent
transactions as a result of consumers’ credit card being lost or
stolen.

CREDIT CARDS IN ATMs

Many credit cards can be used even in ATMs to withdraw money
against the credit limit extended to the card but many card issuers
charge interest on cash advances before they do so on purchases.
The interest on cash advances is commonly charged from the date

13 | P a g e
the withdrawal is made, rather than the monthly billing date. Many
card issuers levy a commission for cash withdrawals, even if ATM
belongs to the same bank as the card issuer. Merchants do not offer
cash backs on credit card transactions because they would pay a
percentage commission of the additional cash amount to their bank
or merchant services provider, thereby making it uneconomical.
Many credit card companies will also, when applying payments to a
card, do so at the end of the billing cycle, and apply those payments
for everything before cash advances. For this reason , many
consumers have large cash balances which have no grace period
and incur interest at a rate that is usually higher than the purchase
rate, and will carry those balances for years, even if they pay-off
their statement balance each month

CREDIT CARD NETWORKS

 AMERICAN EXPRESS

 BANKCARD

 CHINA UNION PAY

 DINERS’ CLUB

 DISCOVER

 JCB

 MASTERCARD

14 | P a g e
PRECAUTIONS TAKEN AFTER RECIEVEING A
CREDIT CARD

TO AVOID

 Bending the card

 Exposure to electronic devices and gadgets

 Direct exposure to sunlight

 Be cautious about disclosing your account number over the

phone unless you know you are dealing with a reputed
company

 Never put your account number on the outside of an envelope

or a postcard.

 Draw a line through blank spaces on charge or debit slips

above the total so the amount can not be changed.

 Don’t sign a blank charge or debit slip.

 Tear up carbons and save your receipts to check your monthly

statements.

 Cut up old cards – cutting through the account number –

before disposing them.

 Open monthly statements promptly and compare them with

your receipts. Report mistakes or discrepancies as soon as
possible to the special address listed on your statement for

15 | P a g e
 enquiries. Under the FCBA ( credit cards) and the EFTA
( ATM or debit cards), the card issuer must investigate errors
reported to them within 60 days of the date your statement
was mailed to you.

 Keep a record – in a safe place away from your cards – of

your account numbers, expiry dates, and the telephone
number of each card issuer so you can report a loss quickly.

 Carry only those cards that you anticipate you’ll need.

TO DO

 Please sign on the signature panel on the reverse of the card

immediately with a non-erasable ball-point pen (preferably in
black ink). This will ensure that the benefits of membership
are yours and yours alone.

• Keep the card in a prominent place in your wallet. You will

notice if it is missing.

REASONS FOR CREDIT CARDS BEING

REJECTED AT A RETAIL OUTLET
 One may have exceeded the borrowing limit of defaulted
( constantly) on minimum payment due.

16 | P a g e
  The card is HOT-LISTED

 The card has crossed it’s expiry dates.

 Non-receipt of dues of one card blocks future transactions on

any other cards held of the same card issuing bank.

 The magnetic stripe on the reverse of the card is damaged. I .

e has been scratched or exposed to continuous heat /direct
sunlight or magnetic field – like- card kept near a TV set/
other electronic appliances.

 Systems or technology failures have in rare instances also

leads to non acceptance of cards when swiped through an
electronic terminal.

JUSTIFICATION OF THE STUDY

 The researcher has chosen the topic in order to study the

customers’ perception towards SBI credit cards – A study in
Raipur city

 This study will reveal, how customers are actually purchasing

credit cards and on what basis they are selecting as well as
for what major purposes they are selecting a credit card. This
will help financial institutions like banks to understand the
behavior of customers at the time of selecting any credit card
so that they may frame suitable strategies accordingly.

17 | P a g e
  This study will also help students to understand customers’
behavior with respect to selection of a particular credit card.
The researcher has chosen this topic because limited
literature is available with respect to purchase of credit cards
and recently people are taking interest in credit cards as a
result of rise in incomes and they are more willing to spend
rather than save it in India. So even after fulfilling basic needs
people are looking forward for taking credit in order to fulfill
their luxury needs.

 These are the main reasons because of which the researcher

has taken keen interest in performing a research in this topic.

18 | P a g e
 • .

BIBLIOGRAPHY

• How Credit Cards Work

By-- Gillian Houghton

• Cash, Credit Cards, Or Checks: A Book About Payment

Methods

Nancy Loewen (Author),

Brad Fitzpatrick (Illustrator)

19 | P a g e
 • www.statebankofindia.com

20 | P a g e