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The difference between checks and plastic cards is that the movement of funds is carried out through commands transmitted over a computer network using a plastic card, rather than through the issuing of paper checks. The future of all types of monetary payments is seen in «electronic checks», as the most convenient and perfect form of storing and using money.
Common in the West and very convenient in everyday life, plastic money – credit and debit cards – are gradually taking root here among us cash lovers. Therefore, it would be quite useful to understand the pros and cons of payment systems and learn to extract maximum benefit and pleasure from them.
Plastic money is much more convenient than paper money, if only because you don't have to carry a wallet bulging with banknotes in a pocket or a lady's handbag, always stuffed with all sorts of things. And even in case of theft, you still come out with your «interest» if you quickly notice the loss and immediately call the bank that issued the credit card. The bank will suspend transactions on the lost card and issue you a new one. Plastic money does not need to be declared at customs – also a considerable relief if you intend to take out of the country an amount exceeding the allowed limit.
So we can say that a small piece of plastic is a universal civilized «key» to managing your bank account. It sounds, of course, unusual: for many of us, the most virtuoso banking operation we have ever had to perform in life is opening and closing an account at Sberbank. Well, and perhaps a few intermediate manipulations: withdrawing money or vice versa – depositing money. A credit or debit card allows you to make non-cash transactions. Simply put, pay in a store, restaurant, airline ticket office, and any other «establishment» that accepts plastic money, without bothering to count banknotes. You present the card, the necessary amount is debited from the bank account in a matter of minutes, and everyone, satisfied with each other, goes their separate ways.
A special card account (your «card» account) in terms of its mechanism of operation is, in principle, similar to a regular bank account, on which even considerable interest is accrued. Thus, money you do not use nevertheless «works», increasing each month by a very specific amount. If you decide to withdraw all the money at once and cancel your existing card, the bank will not take a single kopeck from you for this service, only say after you that it will gladly issue you a new card when you wish.
The cardholder can always get cash as well. To do this, he must personally come to the bank (transferring the card to anyone is prohibited) or go to an ATM – a machine that dispenses cash in hryvnias or dollars round the clock. To communicate with this smart machine, you need to know the so-called PIN code – usually a combination of four digits that opens access to your bank account. The procedure itself takes just a few minutes and, generally, does not require any mental effort. The main thing is not to mix up the code. It is best to memorize it and under no circumstances keep a piece of paper with the numbers near the card – it is simply impossible to think of a bigger gift for thieves.
With cards, you can pay utility bills, make phone calls, refuel your car. But to top up an account at any other bank from your card, you can use online banking via the Internet. If cash is used, you will have to go to a bank branch or find a self-service terminal that accepts banknotes.
If you decide to become an owner of plastic money...
...First of all, understand what «denominations» they come in. As a rule, banks work with two types of cards – credit and debit. The latter allow you to spend only the funds that come into the account. With a credit card, you can make purchases on credit, paying the bank once a month or, if you don't have the money, eventually paying an amount that includes interest on the debt. Credit cards are issued only to well-established customers whom the bank fully trusts and is confident in their solvency. As a rule, to open such an account, you need to make a security deposit – a certain amount of money that you are not allowed to spend. This inviolable «reserve» is a kind of bank protection system against unreliable customers.
Technically, cards are again divided into two types: magnetic (with a corresponding stripe on the back of the card) and chip, where the magnetic stripe is replaced by a microprocessor. According to experts, the future, naturally, lies with chip cards – they are easier to use, harder to counterfeit, and generally more difficult to use in fraud. However, the experience of our tourists shows that there are still fewer ATMs for chip cards (say, in Spain) than for magnetic ones, and therefore many still prefer to use magnetic cards.
The operating schemes for both magnetic and chip cards are almost identical. When you come, for example, to a store, you give the «plastic» to the seller, who first obtains confirmation from your bank that there is money in the account. Then a standard form called a «slip» is filled out, on which an imprint of your card is made. The signature on the card and on the «slip» must match, which the seller must verify. One copy of this document is given to the cardholder, the second is sent to the bank, and the third, accordingly, remains in the store.
International plastic cards
Currently, there are five largest international payment systems that essentially control the global market for plastic cards. Among them, Visa International leads, followed in popularity by Europay International (Eurocard/MasterCard and Cirrus/Maestro), American Express, Diners Club, and JCB (used mainly in Japan). In our country, American Express enjoys greater popularity than the other systems – very prestigious but by no means cheap credit cards: their security deposit alone averages 15 thousand dollars. Furthermore, holders of these cards can only get cash at the American Express office or the World Trade Center, and banks will simply refuse you this service – indeed, such an operation as cashing is practically not provided by the company.
But it is more practical, and most importantly, realistic (with an appropriate income level) to look at Visa and Eurocard/MasterCard credit cards. The Visa system – the most popular in the world – unites millions of users under its 'plastic roof', is accepted for payment in 72 countries; its clients are served by about 20 thousand banks.
Europay International is little inferior to its competitor, except perhaps in payment turnover. Therefore, having decided to become a member of one of these international systems (or better, both at once), first of all, choose a bank.