Hello everyone I had a few questions about credit card accounts so I figured I would find the answers and share them with you. Here they are:
Q: What was the first credit card issued?
A: The first bank card, named “Charg-It,” was introduced in 1946 by John Biggins, a banker in Brooklyn, according to MasterCard. When a customer used it for a purchase, the bill was forwarded to Biggins’ bank. The bank reimbursed the merchant and obtained payment from the customer. The catches: Purchases could only be made locally, and Charg-It cardholders had to have an account at Biggins’ bank. In 1951, the first bank credit card appeared in New York’s Franklin National Bank for loan customers. It also could be used only by the bank’s account holders.
Q: How much money does the average American household owe on a credit card?
A: Average credit card debt per household with credit card debt: $15,788.
Q: How many credit cards are in circulation in the US?
A: Total credit cards in circulation in U.S: 576.4 million, as of yearend 2009.
Q: Is there a legal maximum interest rate that a credit card can charge?
A: For all practical purposes, no.
Federal law sets no nationwide limit on how much credit cards can charge.
While many states have usury laws that regulate the rates on all types of loans, they only apply to banks based in that state and don’t protect consumers who borrow from out-of-state lenders.
That’s why most major credit card companies are incorporated in Delaware or North Dakota. These states have no usury laws and therefore impose no limits on how much they can charge customers across the country.
If your credit card company has a maximum rate it will be stated in the “Terms and Conditions” — that incomprehensible booklet you were given when you signed up. But many of those agreements simply say rates can be changed as often as the issuer wants and without any notice.
Most cards max out around 29% for customers who have been thrown into universal default for missing a payment or two — and not necessarily a payment to that card. But we’ve heard of cards charging as much as 33%.
Q: What are the most common fees associated with credit cards?
A: The major fees are for:
* Late payments or overdue payments
* Charges that result in exceeding the credit limit on the card (whether done deliberately or by mistake), called overlimit fees
* Returned cheque fees or payment processing fees (e.g. phone payment fee)
* Cash advances and convenience cheques (often 3% of the amount)
* Transactions in a foreign currency (as much as 3% of the amount). A few financial institutions do not charge a fee for this.
* Membership fees (annual or monthly), sometimes a percentage of the credit limit.
* Exchange rate loading fees (sometimes these might not be reported on the customer’s statement, even when applied). The variation of exchange rates applied by different credit cards can be very substantial, as much as 10% according to a Lonely Planet report in 2009
There are still thousands of questions about credit cards, if you have one ask me by sending the question to Support@1-2-3-CreditCards.com! Also, when choosing a credit card, you can trust Discover card and Chase credit cards.
