INTRODUCTION

A credit card is a payment card issued to users (cardholders) to

enable the cardholder to pay a merchant for goods and services based on

the cardholder's promise to the card issuer to pay them for the amounts so

paid plus the other agreed charges. The card issuer (usually a bank)

creates a revolving account and grants a I inc of credit to the cardholder,

from which the cardholder can borrow money for payment to a merchant

or as a cash advance. In other words, credit cards combine payment

services with extensions of credit.” Complex fee structures in the credit

card industry may limit customers' ability to comparison shop, helping to

ensure that the industry is not price-competitive and helping to maximize

industry profits. Due to concerns about this, many legislatures have

regulated credit card fees."

A credit card is a plastic card that represents a line of credit. A line

of credit is an account with money that you can borrow repeatedly. I n

most cases, this is not going to be your money. It is going to come from a

credit card issuer, like Chase or ICICI Bank. You will usually have more

than one issuer for a single card. Your account will be assigned a certain

limit based on the information from your application. Then you can swipe

your card as needed to spend money out of it. The money you spend on a

credit card has to be paid back. If you do not make your payments by a
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certain day of the month, you will have to pay interest, and potentially a

late fee. We’11 go over all of this in a little bit, but you have to

understand one thing. . . A credit card is not a source of free money. This

is not a scholarship, donation, gift, or anything along those lines. It’s

something you can use when you need money, assuming you will pay it

back.

DEFINITION

A credit card is different from a charge card, which requires the

balance to be repaid in full each month. In contrast, credit cards allow the

consumers a continuing balance of debt, subject to interest being charged.

A credit card also differs from a cash card. which can be used like

currency by the owner of the card. 4 credit card differs from a charge card

also in that a credit card typically involves a third-party entity that pays

the seller and is reimbursed by the buyer, whereas a charge card simply

defers payment by the buyer until a later date.

HISTORY

Edward Bellamy’s Looking Backward

The concept of using a card for purchases was described in 1 887

by Edward Bellamy in his utopian novel Looking Backward. Bellamy

used the term credit card eleven times in this novel, although this referred
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to a card for spending a citizen's dividend from the government, rather

than borrowing I making it more similar to a Debit card.

Charge coins, medals, and so on

Charge coins and other similar items were used from the late 19th

century to the 1930s. They came in various shapes and sizes; with

materials made out of celluloid (an early type of plastic), copper,

aluminum, steel, and other types of whitish metals.' '" Each charge coin

usually had a little hole, enabling it to be put in a key ring, like a key.

These charge coins were usually given to customers who had charge

accounts in department stores, hotels, and so on. A charge coin usually

had the charge account number along with the merchant's name and logo.

The charge coin offered a simple and fast way to copy a charge

account number to the sales slip by imprinting the coin onto the sales slip.

This sped the process of copying, previously done by handwriting. It also

reduced the number of errors, by having a standardised form of numbers

on the sales slip, instead of various kind of handwriting style.

Usage

A credit card issuing company, such as lCICI bank or credit union,

enters into agreements with merchants for them to accept their credit

cards. Merchants often advertise which cards they accept by displaying

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acceptance marks generally derived from logos — or this may be

communicated in signage in the establishment or in company material

(e.g., a restaurant's menu may indicate which credit cards are

accepted). Merchants may also communicate this orally, as in ”We take

(brands X, Y, and Z)" or ”We don't take credit cards".

Technical specifications

The size of most credit cards is 85.60 mm ^ 53.98 mm (3 ‘Zt • 2

inches) and rounded corners with a radius of 2.88—3.48 mm."’

conforming to the ISO/IEC 7810 ID-1 standard. the same size as ATM

cards and other payment cards, sue h as debit cards.

Credit cards have a printed'7 or embossed bank card number

complying with the ISO/IEC 7812 numbering standard. The card

number's prefix, called the Bank Identification Number, is the sequence

of digits at the beg inning of the number that determine the ICICI bank

to which a credit card number belongs. This is the first six digits for

MasterCard and Visa cards. The next nine digits are the individual

account number, and the final digit is a validity check code.

Both of these standards are maintained and further developed by

lSO/IEC JTC I/SC 17/WG 1. Credit cards have a magnetic stripe

conforming to the ISO/1EC 37813. Many modem credit cards have a

computer chip embedded in them as a security feature.

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 In addition to the main credit card number, credit cards also carry

issue and expiration dates (given to the nearest month), as well as extra

codes such as issue numbers and security codes. Not all credit cards have

the same sets of extra codes nor do they use the same number of digits.

Credit card numbers were originally embossed to allow easy

transfer of the number to charge slips. With the decline of paper slips,

some credit cards are no longer embossed and in fact the card number is

no longer in the front."

Types Of Credit And Credit Cards

Two basic types of credit are secured and unsecured. Secured

credit means that the product you purchased, such as a car, appliance or

furniture, serves as collateral to guarantee the debt. If you do not make a

payment, the creditor can legally take possession of the product.

Unsecured credit is based on your promise and signature to repay the debt

without committing your savings or other collateral as a guarantee. Credit

cards can be either secured or unsecured. Most credit cards are unsecured.

Benefits of Credit Card

lf you are prudent with your spending habits, credit cards offer a

plethora of benefits which can be very rewarding for you. Let us talk

about some such benefits-

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 No need to carry cash - With a credit card, the need to carry cash

goes away. When you don’t have balance in your IC1CI bank

account, your debit’ card is of no use. But a credit card helps you

do shopping and entertainment hassle-tree as you don’t have to

worry about carrying cash. This also ensures safety of money.

Online transactions can also be made with your credit card.

 Fulfils emergency cash requirement - Whether there is a medical

emergency or any other kind of unexpected cash requirements.

Credit cards can come for your rescue by providing credit under

such circumstances.

 Increases purchasing power- With credit cards you can spend

more than you actually own. It raises your purchasing power. Now

you don‘t have to compromise on your shopping list due to

shortage of cash.

 Interest free credit- All credit cards offer you interest-free period

where no interest will be charged it‘ you repay the credit that you

have taken within the due date.

 Grace Period- Most of the banks provide grace period to their

customers within which they can pay their outstanding EMls

without any extra interest charges. Generally, this grace period is

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 20 days starting from the day of the bill.

NEED OF STUDY

 The need for the study is written in the introduction section

of the thesis.

 Sometimes, the need for the study or the significance of the

study is called rationale.

 The problem statement will help you in writing the need for

the study. With the problem statement as the reference, you

will understand the potential benefits of your study.

 The need for the study will determine the particular

contribution of thesis study with regard to the society as well

as to the person.

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SCOPE OF STUDY

 When you are clearly able to identify the needs of a project, you

are more likely to set a sound benchmark from the beginning.

 The basis of the project scope should entail your goals and

objectives to be one that follows a SMART guideline.

 This involves stating accurately what the project wants to achieve.

That is, what, why and how these will be done.

 Successful projects are ones that take into account the satisfaction

of the end-user.

 There are always road blocks to achieving what you were set out to

do.

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OBJECTIVES

 Financial objectives are normally relatively easy to put together

and you will find your sponsor is keen to make sure that if your

project is going to make the company any money that this is record

adequately in the project objectives.

 There may be some quality objectives for your project, such as

delivering to certain internal or external quality standards. Quality

objectives also manifest themselves in the form of process

improvement projects that aim to reduce defects or increase

customer satisfaction somehow.

 Companies already have technology in use so a technical objective

could be to upgrade existing technology. install new technology or

even to make use of existing technology during the deployment of

your project.

 Performance objectives tend to be related to how the project will be

run, so could include things like delivering to a certain budget

figure or by a certain date, or not exceeding a certain number of

resources.

 Regulatory requirements form compliance objectives. For example,

there could be the obligation to meet legal guidance on your project or to

comply with local regulations. When being aware of possible limitations

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along the way.

METODOLOGY

1. Primary Data:- Primary data has been collected through well

structured comprehensive questionnaires. The questions were

designed keeping in view of the objectives of the study. Two sets

of questionnaires were developed, one for the ICICI bank

customers and one for the back execution. In some cases, the

researcher also had personal discussion with the responders with

the objectives of soliciting additional information and using this

information to supplement the information collected through

questionnaires. The final sets of questionnaires along with covering

letter were then mailed to a total of 1000 ICICI bank customers and

60 bank employees selected via convenient sampling technique

from Sonipat and Rohtak Districts of Haryana state. Following

procedure was adopted to collect data from the targeted

respondents.

2. Secondary Data: Secondary data is the data which is available in

published form and which was collected earlier by people for some

purposes. There may be various sources of secondary data such as-

newspapers, magazines, journals, books, reports, documents and

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 other published information.

 ICICI Banks annual reports — ICICI Banks issues there

annual reports to get the people informed with the

profitability and growth of the bank. These annual reports

help a lot to get the latest data and other related

information for our research. It tells about the increase or

decrease in profits and other facilities.

 Manuals and Brochures of ICIC1 banks - manuals and

broachers of ICIC1 banks also help in identifying various

financial services provided by the banks.

LIMITATIONS

 The number of the units of analysis you use in your study is

dictated by the type of research problem you are investigating.

 A lack of data or of reliable data will likely require you to limit the

scope of your analysis, the size of your sample.

 Citing prior research studies forms the basis of your literature

review and helps lay a foundation for understanding the research

problem you are investigating.

 Sometimes it is the case that, after completing your interpretation

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 of the findings.

 Whether you are relying on pre-existing self-reported data or you

are conducting a qualitative research study and gathering the data

yourself. Self - reported data

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 CHAPTER – II
COMPANY PROFILE

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 CHAPTER – II

INDUSTRY PROFILE

A bank is a financial institution that provides banking and other financial

services to their customers. A bank is generally understood as an

institution which provides fundamental banking services such as

accepting deposits and providing loans. there are also non-banking

institutions that provide certain banking services without meeting the

legal Banks are a subset of’ the financial services industry. A banking

system also referred as a system provided by the bank which offers cash

management services for customers. Reporting the transactions of their

accounts and portfolios, throughout the day. I he banking system in India,

should not only be hassle free but it should be able to meet the new

challenges posed by the technology and any other external and internal

factors. For the past three decades, India’s bank ink system has several

outstanding achievements to its credit. 1 he Banks are the main

participants of the financial system in India. Before the establishment of

banks, the financial activities were handled by money lenders and

individuals. At that time the interest rates were very high. Again there

were no security of public savings and no uniformity regarding loans. So

as to overcome such problems the organized banking sector was

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established, which was fully regulated by the government. The organized

banking sector works within the financial system to provide loans, accept

deposits and provide other services to their customers.

The Banking sector offers several facilities and opportunities to their

customers. All the banks safe guards the money and valuables and

provide loans, credits and payment services, such as checking accounts,

money orders, and cashier’s cheques. The banks also offer investment

and insurance products. As a variety of models for cooperation and

integration among finance industries have emerged. some of the

traditional distinctions between banks, insurance companies, and

securities firms have diminished. In spite of these changes, banks

continue to maintain and perform their primary role - accepting deposits

and lending funds from these deposits.

Working of Credit Card System

The customers can use the credit card for purchasing goods and

availing services from the various shopkeepers. When the customer

makes a purchase in a shop, instead of making payment, the card is

produced at the cash counter. The seller examines validity of the card

through a machine. which ratifies the sales. The bill is made in

three copies. The customer is given the bill on which his • m ature w
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ill be affixed. The sale is complete. A copy ot’ the bill is gisen

to the customer. Another is sent to the bank which has issued the

crcdit card

and the third copy is retained by the sells . rhe bank un rcceiv ing

various such bills of the customer will prcpare a cunsoliJatcd bill and

send it to the customer at the end of the month. The customer \\ ill make

a single payment to the bank or allow the bank tc debit frcm his

account. In every bi II. the due date of payment w ill be given. 1 t a

customer fails to pay w ithin the due date, interest will be added on the

purchase. It is also not neccssa that the customer should pay full

payment of the hi II as he can makc part payment and settle the hill

in due course. However, the customer will have to pay interest her the

outstanding balance amcunt. T I payment is made for all the

purchases, the customer is allowed to avail fresh credit.

A credit limit is fixed based upon the income of the customer. The

customer

can make purchases only up to this credit limit. Once payment is made by

the

customer, the credit limit will once again revolve to the original amount

(11)

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The sellers can avail the facility of sale through credit card by paying to

the credit card establishment, a fixed amount. The sellers agree to this

as it enhances their sale. On receipt of payment from customers, the

seller's account will be credited

The Vitae Credit Card (CCC j scheme is a credit scheme introduced in

August 1998 by Indian banks. This model scheme was prepared by

the National Bank for Agriculture and Rural Development (NABARO)

on the recommendations of R.V.GUPTA committee ’ to provide term

loans and agricultural needs.

Its objective is to meet the comprehensive credit requirements of the

agriculture sector and by 2019 for fisheries and animal husbandry by

giving financial support to farmers. Participating institutions include all

commercial banks, Regional Rural Banks, and state co-operative banks.

The scheme has short term credit limits for crops, and term loans. KCC

credit holders are covered under personal accident insurance up to

150,000 for death and permanent disability, and up to 125,000 for other

risk. The premium is home by both the bank and borrower in a 2:1 ratio.

The validity period is five years, with an option to extend for up to three

more years. Kisan Credit Card (KCC) offering credit to the farmers in

two types viz, 1. Cash Credit 2. Term Credit ( for allied activities such as

pump sets, land development, plantation, drip irrigations)

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Visa Inc. (/'vi:za/ or /'vi:sa/) (also known as Visa, stylized as VISA ) is an

American multinational financial services corporation headquartered in

Foster City, California, United States. " It facilitates electronic

funds transfers throughout the world, most commonly through Visa-

branded credit

cards, gift cards, and debit cards. 41 Visa does not issue cards, extend

credit or set

rates and fees for consumers; rather, Visa provides financial institutions

with Visa-branded payment products that they then use to offer credit,

debit, prepaid and cash-access programs to their customers. In 2015, the

Nilson Report, a publication that Wks the credit card industry, found that

Visa’s global network (known as VisaNet) processed 100 billion

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transactions during 2014 with a total volume of US$6.8 trillion.

Visa has operations across all six continents. Nearly all Visa transactions

worldwide are processed through the company’s directly-operated

VisaNet at one of four secure data centers. located in Aslibuni, Virginia:

Hibltlands Ranch, Colorado; London, England; and Singapore."” These

facilities are heavily secured against natural disasters, crime, and

terrorism; can operate independently of each other and from external

utilities if necessary: and cali handle up lo 30,000 simultaneous

transactions and up to 100 billion computations every second. Every

transaction is checked past 500 variables including 100 fraud-detection

parameters, such as the locafioii and spending habits of the customer and

the merchant's location, before being accepted.' 7""' "

Visa is the world's second-largest card payment organization (debit and

credit cards combined). after being surpassed by China UnionPav in

20.15. based on annual vahie of card payments transacted and number of

issued cards

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Mastercard Incorporated (stylized as MasterCard from 1979 to 2016

and mastercard from 2016) is an American multinational financial

services corporation headquartered in the Mastercard International Global

Headquarters in Purchase, New York, United States.'" The Global

Operations Headquarters is located in O’Fallon, Missouri, United States,

a municipality of St. Charles County, Missouri. Throughout the world, its

principal business is to process payments between the banks of merchants

and the card issuing banks or credit unions of the purchasers

who use the "Mastercard” brand debit, credit and prepaid to make

purchases. Mastercard Worldwide has been a publicly traded company

since 2006. Prior to its initial public offering, Mastercard Worldwide

was a cooperative owned by the more than 25,000 finmicial

instituñons that issue its branded cards.

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Mastercard, originally known as ”Interbank" from 1966 to 1969 and

”Master Charge" from 1969 to 1979, was created by an alliance of several

regional bankcard associations in response to the BankAmericard issued

by Bank of America, which later became the Visa credit card issued by

Visa Inc.

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HISTORY OF INDIAN BANKING SECTOR

The first bank in India, called The General Bank of India was

established in the year 1786. The East India Company established The

Bank of Bengal/Calcutta (1 809), Bank of Bombay ( 1840) and Bank of

Madras ( 1 843). The next bank was Bank of Hindustan which was

established in 1 870. These three individual units (Bank of Calcutta.

Bank cf Bombay, and Bank of Madras) were called as Presidency

Banks. A1 lahabad Bank which was established in 1865, was tor the

first time completely run by Indians. Punjab National Bank Ltd.

was set up in 1 894 with head quarters at Lahore. Between 1906 and

1913. Bank ot India, Central Bank of India, Bank of Baroda. Canara

Bank, Indian Bank, and Bank of Mysore were set up. In 192 I . all

presidency banks were amalgamated to form the Imperial Bank of India

which was run by European Shareholders. After that the Reserve Bank of

India was established in April 1935. At the time of first phase the growlh

of banking sector was very slow. Bew een 19 I S and 1948 there were

approximately 1 1 00 small banks in 1 ndia. To streamline the

functioning and activ ities ot’ commercial banks. the Go merriment of 1

ndia came up with the Banking Companies Act, 1949 which was later

changed to Bankin g Regulation

Act 1949 as per amending Act of 1 965 (Act No.23 of 1965 ).

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Reserv e Bank of India was vested with extensive puwers for the

supervision of hank ing in India as a Central Banking Authority. After

independence. Government has taken most important steps in regard of

Indian Banking Sector reforms. In I9S5, the Imperial Bank of India was

nationalized and was given the name "State Bank of 1nd ia", to act as

the princ ipal agent of RBI and to handle banking transactions all over the

country. It was established under State i3ank of’ 1 ndia Act. 1955 . Seven

banks forming subsidiary ot State Bank of’ 1 ndia was nationalized in

1960. On 19th July. 1969, major process of nationalization was carried

out. At the same time 14 major Indian commercial banks of the country

were nationalized. I n 1 980, another six banks were nationalized, and

thus raising the number of nationalized banks to 20. Seven more banks

were nationalized with deposits over 200 C rores. Till the year 1980

approximately 80% of the banking segment in India was under

government's ownership. On the suggestions ofi Narsimhan Committee,

the Banking Regulation Act was amended in 1993 and thus the gates for

the new private sector banks were opened. The following are the major

steps taken by the Government of India to Regulate Banking institutions

in the country: -

1949 : Enactment of Banking Regulation Act.

1955 :Nationalisation of State Bank of India.

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1959 : Nationalization of SBI subsidiaries.

1961 : 1 nsurance cover extended to deposits.

1969 :Nationalisation of 14 major Banks.

1 971 : Creation of credit guarantee corporation.

1975 : Creation of regional rural banks.

1980 : Nationalisation of seven banks with deposits over 200 C rores.

Nationalisation

By the 1960s, the Indian banking industry has become an important tool

to facilitate the development of the Indian economy. At the same time, it

has emerged as a large employer, and a debate has ensured about the

possibility to nationalise the banking industry. Indira Gandhi, the-then

Prime Minister of India expressed the intention of the Government of

India (€iOI) in the annual conference cf the All India Congress Meeting

the GOI issued an ordinance and nationalised the 14 largest commerc lal

banks with effect from the midnight of July 1 9. 1969. Jayaprakash

Narayan. a national leader of India. described the step as a ”Masterstroke

of political sagacity” W ithin two weeks of the issue of the ordinance. the

Parliament passed the Banking Companies (Acquisition and Transfer

of Undertaking) B ill. and it received lhe presidential approval on 9

August, 1969. A second step of nationalisation of 6 more commercial

banks followed in 1980. The stated reason for the nationalisation was to

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give the government more control of credit delivery. With the

second step of national isation. the GO I controlled around 91% of the

banking business in India. Later on, in the year 1993, the government

merged New Bank ot’ India with Punjab National Bank. lt was the only

merger between nationalised banks and resulted in ihe reduction of the

number of nationalized hanks from 20 to 9. After this. until the 1990s.

the nationalized banks grew at a pace of around 4%, c loser to the

average growth rate ct the Indian economy. The nationalized banks

wale credited by some; including Home minister P. Chidambaram, to

have helped the Indian economy withstand the global financial crisis of

2007-2009.

Liheralisation

Thcre are Mo areas of competitions which banking industry is fac ing

internationally and national 1 y. In the early 1990s. the then

NarsimhaRao government embarked en a pc›Iicy of liberalization.

licensing a smal I num her of privatc banks. could gruw in a c luscd

econcmv hut the banking sectcr ‹›pencd up for private competition. lt

is possible that private banks could become dominant players even w

ithin 1 ndia. These came to be know n as New Generation tech-savvy

banks. and included Glcbal r« t Bank (the tirst of such nev generation

banks to be set rip ), which later amalgamated with Oriental Bank of

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Commerce, Axis Bank(earlier as UTI Bank), I C ICI Bank and I

IDFC Bank. This move along with the rapid growth in the economy of

India revolutionized the banking sector in India which has seen rapid

growth with strong contribution from all the three sectors of banks,

nameiy, government banks, private banks and foreign banks. The new

policy shook the banking sector in India completely sector banks are

aligning its infrastructures, marketing quality and technology to build

deep commitment in building consumer and retail banking. The main

focus of these banks is on innovative range of services or products. In

the pre-liberalization era, Indian banks. Use of ATM cards, Internet

Banking, Phone Banking, Mobile Banking are the new innovative

channels of banking which are being widely used as they result in saving

both time and money which are two essential things that everyone is short

of and is running to catch hold of them. Moreover private seThe Reserve

Bank of India is an autonomous body, with minimal pressure from the

government. The stated policy of the Bank on the Indian Rupee is to

manage volatility but without any fixed exchange rate-and this has mostly

been true. With the growth in the Indian economy expected to be strong

for quite some time-especially in its services sector-the demand for

banking services, especially retail banking, mortgages and investment

services are expected to be strong.

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COMPANY PROFILE

INTRODUCTION

ICICI Bank is India’s second-largest bank with tctal assets of ’ 4.062.34

billion (US$ 9 I billion) at March 31 . 2011 and profit after tax 51.51

billion (US$ 1,1 55 million) for the year ended March 3 I, 20 T I . The

Bank has a network of 2.752 branches and 9,225 ATMs in India,

and has a presence in 19 countries, including 1 ndia. l ClCl Bank

offers a wide range ofi banking products and financial serv ices to

corporate and retail customers through a variety ot’ delivery channels

and through its specializcd subsidiaries in the areas of investment

banking, life and non-like insurance, venture cap ital and asset

management. The 9ank currently’ has subsidiaries in the United

Kingdom. Russia and Canada, branches in United States, Singapore.

Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai 1 ntemational

Finance Centre and representative offices in United Arab Emirates,

China. Scuth A Erica, Bangladcsh, Thailand, Malaysia and Indonesia.

The UK subsidiary has established branches in Belgium and Germany.

ILICI Bank's equity shares are listed in India on Bombav Stock

Exchange and the National Stock Exchangc of India Lim ited and

its American Depositary Rcceipts (A DRs) are listed on the New York

Stock Exchange (NYSE).

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ICU I Bank was the tirst private seclor bank in India to of fer PPF

account facil ity at all baiikbranches.

Amcng the first banks to introduce account portability and also the

only hank to cider purtabiIit\ en two additional channels - Intemei

Banking and Phone Banking.

ICICI Bank launches tirst 2lcctronic Roll Collection prnjcct on N II - I .

A first of” its kind project initiated fry the Minist of Road, Transport &

Highways. National Highway Authority of India (N HA I) and

IClClBank.

lCIC1 Bank receives approval from RBI to set up an Infrastructure

Debt Fund. lt is the first debt fund to get government's goahead.

lC ICI Bank launches its official Facebook Page. First bank in India to

offer one-of-its kind " Your Bank Account" App, which allows

access to bank account information on Facebook.

To be the leading provider of financial services in India and a major

global bank.

It will leverage the people, technology, speed and financial capital to:

•• Be the banker of first choice for the customers by delivering high

quality, world-class products andservices.

Fxpand the frontiers of the businessglobally.

Playaproactiveroleinthefullreal izationoflndia”spotcntial.

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Maintain a healthy financial profi le and diversi fy the earnings across

businesses andgeographies.

Maintain high standards ot governance andethics. Contribute positiveiy to

ihe various countries and markets in which we operate.

Create value for thestakeholders.

HISTORY

ICICI Bank was originally promoted in 1994 by lC DC1 Limited. an 1

ndian financial institution, and was its wholly-owned subsidiary. IC ICI’s

shareholding in ICICI Bank v.as reduced to 46% through a public

of”fcring of shares in India in tiscal 1998, an equity differing in the form

of ADRs listed on the NYSE in fiscal 2000, ICICI Bank’s acquisition of

Bank of Madura Limited in an at I-stock amalgamation in fiscal 200 I ,

and sccondary market sales by ICICI to institutional investors in seal 200

I and fiscal 2002. ICICI was formed in 1955 at the initiative of the

World Bank, the Government ot India and representatives of Indian

industry. The principal objcctive was to create a development financial

institution tor providing medium-term and long-term project financing

to Indian businesses. In the 1990s, lC1 CI transformed its business

from a development financial institution offering only project finance to a

diversified financial services group offering a wide variety of products

and serv ices, both directly and through a number ot subsidiaries and

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affiliates like ICICl Bank. I n 1999. IC ICI become the first Indian

company and the first bank or financial institution from non-Japan Asia

to be listed on theNY SE.

After consideration of various corporate structuring alternatives in

the context of the emerging competitive scenario in the Indian bank ing

industry. and the move towards universal banking, the managemcnts of

lC lC I and ICICI Bank tormed the v iew that the merger ot lCIC I with

IC ICI Bank would be the optimal strategic alternative for both entities,

and would create the optimal legal structure for the IC IC [ group's

universal harking strategy. The me s er would enhance value fnr ! CIC !

shareholders thrcuyh the merged entity's access to low-cost deposits.

greater opportunities for earning t’ee-based income and the ability to

participate in the payments system and provide transactitin-banking serv

ices. The merger would enhance value for IC lC1 Bank shareholders

through a large capital base and scale ot’ operations, seamless access to

IC I C1's strong corporate relationships bui lt up over fi ve decades entry

into new bus iness segments, higher market share in various business

segments, particularly fee-based serv ices, and access to the vast talent

poo[ of’ ICICI and itssubsidiaries

In October 200 1, the Boards of Directors of IC UI and IC I Cl

Bank approved the merger of ICICI and two of its wholly-owned retail

3
0
finance subsidiaries. IC IC1 Personal Financial Serv ices Limited and ICI

CI Capital Serv ices Limited, with lCIC1 Bank. The merger was

approved by shareholders of 1CIC I and I C ICI Bank in January 2002, by

the High Court of Ciujarat at Ahmadabad in March 2002. and by the High

Court of I udicature at Mumbai and the Reserve Bank of 1 ndia in April

2002. Consequent to the merger, the 1 ClCl group's financ ing and

banking operations, both wholesale and retail, have been integrated in a

single entity. ICICI Bank has formulated a Code ot” Business Conduct

and Ethics for its directors andemp[oyees.

ICICl Bank (BSE: lClC1) (formerly Industrial Credit and

Investment

Corporation ot India) is India's largest private sector bank in market

capitalization and second largest overall in terms of assets. Bank has total

assets of about USD 100 billion (at the end ot March 2008), a network txt

os er i ,399 branchcs, 22 regional otfices and 49 regional processing

centers. abcut J,485 ATMs (at the end of Scptember 2008), and 24 mi Hi

on customers (at the end of J uly2007).

ICICI Bank o f’fers a wide range ot banking products and tânancial

services to corporate and retail custtimers through a variety of del ivery

channels and specialized subsidiaries and a ftiliates in the areas of

investment hank iny, Iif”e and non-Iif”e insurance, venture capital and

3
1
asset management. (These data are dynamic.) ICICI Bank is also the

largest issuer of” credit cards in India. [ . IC IC [ Bank has got its

cquity shares )isted on the stock exchanges at Kolkata and

Vadodara.Mumbai and the Nat ional Stock E Kchange oflndia Limited.

and its ADRs on the New York Stock Exchange (NYSE).

The Bank is expanding in overseas markets and has the largest

international balance sheet among Indian banks. ICI CI Bank now has

wholly- owned subsidiaries, branches and representati vcs ulTices in 18

c‹›unlries, including an ct”fshore unit in Mumbai. This includes whclly

owned subsidiaries in Canada, Russ ia and lhe UK, utӣshore banking

units in Bahrain and Singapure. an adv isu branch in Dubai. branchcs

in Belgium, Hong Kong und Sri Lanka. and representative

offices in Bangladesh, China. M alaysia, Indonesia. South Africa,

Thailand, the United Arab Emirates and USA. Oversee.. the Bank is

targeting the N RI (h on- Resident ) ndian) population in particular. lCI

CI reported a I . 15% rise in net profit to I .014.2 1 crore or a 1 .29%

increase in total income to ’ 9,7 I 2.31 crores in Quarter 1 I

Septcmber 2008 over Quarter 11 September2007.

I9SS• the Industrial Credit aud In\’estment Corporation of I ndia Limited

([C IC I ) w as incorporated at the initiative uf WerIJ Bank. the

GovcmMent of India and representatives cif Indian industry. w ith the

3
2
objective ot creating a development financ ial institution for providing

medium-term and lcng-term project financing to Indian businesses.

Mr.A.Ramaswam iMudaliar is elected as the tirst Chairman cf ICU I

Limited. ICI Cl emerges as the major source o I foreign currency loans

to Indian industry. Besides funding from World Eank and other multi -

lateral agene ies. iCIC“l was also among the li rst 1 ndian companies to

raise funds from international markets.

3
3
 CHAPTER - Ilt

THEORITICAL FRAMEWORK

INTRODUCTION

A Credit card is a card or mechanism which enables cardholders to

purchase goods, travel and dine in a hotel w ithout making immediate

payments. The holders can use the cards to get ctedit from banks up to 50

days free of cost. The credit card relieves the consumers from botheration

of the carrying cash and ensures sat’ety. lt is a convenience of extended

credit without formal ity. Thus credit card is a passport to,‘ sat‘ety.

convenience, prestige and credit.” 104 A credit card is a plastic card

having a magnetic strip, issued by a bank or business authorizing the

holder to buy goods or serv ices on credit. Any card, plate or coupon

book that may be used repeatedly to borrow money or buy goods and

services on credit is called credit card.

A credit card is a card establishing the privilege cf thc petson to whom it

is issued to charge bills. Most retail firms accept credit cards. Credit cards

allow consumers to make purchases w ithout pay ing cash immediately or

establishing credit with indiv idual stores. They eliminate the need to

check credit ratings and to coIlec1 cash from individual customers. The

issuing institution establishes the card's terms, including the interest rate,

annual f’ees, penalties. the 8•ace period. and other features. Credit card

debt is typically an unsecured debt. Repossession is not easily

3
4
accomplished by the lender to ensure payment. Banks have often priced

the product assuming maximum risk exposure

HISTORY AND DEVELOPMENT OF CARD

As far back as the latc 180()s. consumers and merchants exchanged goods

through the concept of crcdit, using crcdit coins and charge plates as

currency. It was net until about half a century ago that plastic payments as

we know them today became a way of life. The most common pre-plastic

credit instruments were charge plates, celluloid “coins” and charge coins.

The concept of using a card for purchases was described in 1887 by

Edward Bellamy in his Utopian novel Looking Backward. Bellamy used

the term credit card eleven times in his novel.

In the early 1900s, oil companies and department stores issued their own

proprietary cards. Such cards were accepted only at the business that

issued the card and in limited locations. While modem credit cards are

mainly used for convenience, these predecessor cards were developed as

a means of creating customer loyalty and improving customer service.

The modem credit card was the successor of a variety of merchant credit

schemes. It was first used in the 1920s in the United States, specifically to

sell fuel to accepting each other's cards. Western Union had begun

issuing charge cards to its frequent customers in 1914. Some charge cards

were printed on paper card stock, but were easily counterfeited

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5
PURPOSES

The main purpose of a credit card is it provide the short term financing

and provides you an easy access to the funds at any time, any place

(considering your card is globally acceptable such as VISA and Master

Card networks) e.g. Point of ?Sale and online shopping.

Benefits of credit card you cannot miss.

It lets you enjoy high-end purchases. With its buy-now-pay-later feature

you can buy anything as per the limit of your credit card and pay it off in

monthly installments.

It runs schemes such as cash backs, redeemable reward points, MRP

discounts, waive off jtiining fees etc. to gain maximum value from your

credit card. For instance, Platinum Choice first-Year free Super card from

leading NBFC.

lt can be used to take an emergency Loan. Using this you can convert the

credit card limit into a personal loan. You can avail interest-free cash for

up to 90 days and this money can be repaid in three easy EMIs.

It offers financial security espccially at times you run out of cash. It helps

you pay up for any kind of‘ utility thus keeping you covered against

personal and business financial setbacks.

It lets you save on every purchase which convert to appreciable annual

savings.

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6
lt can be used overseas as well to pay for number of transactions at

nominal charges.

» Paying off your credit card on time positively affects your credit

score. A good/ healthy score in the long run helps to secure preferred loan

amount at affordable interest rate on flexible tenure.

FEATURES

As well as convenient credit, credit cards offer consumers an easy way to

track expenses, which is necessary for both monitoring personal

expenditures and the tracking of work-related expenses tor taxation and

reimbursement purposes. Credit cards are accepted in larger

establishments in almost all countries. and are available with a variety cf

credit limits, repayment arrangements

TYPES OF CREDIT CARD

Business credit cards

Business credit cards are specialized credit cards issued in the name of a

registered business, and typically they can only be used for business

purposes. "I’heir use has grown in recent decades. In 1998, for instance.

37% of small biisinesses reported using a business credit card; by 2009,

this number had grown to 64%.

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7
Business credit cards offer a number of features specific to businesses.

They frequently offer special rewards in areas such as shipping, office

supplies. travel, and business technology. Most issuers use the

applicant's personal credit score when evaluating these applications. In

addition, income from a variety of sources may be used to qualify, which

means these cards may be available to businesses that are newly

established

Secured credit cards

A secured credit card is a type of credit card secured by a deposit account

owned by the cardholder. Typically, the cardholder must deposit between

100% and 200% of the total amount of credit desired. Thus if the

cardholder puts down $1,000, they will be given credit in the range ot"

$50O—1,000. In some cases, credit card issucrs will cf”fcr incentives

c›’cn on their secured card portfolios. In these cases, the deposit

required may be signiticantly less than the required credit limit, and can

be as low as 10% of the desired credit limit. This deposit is held in a

special savings account. Credit card issuers offer this because they have

noticed that delinquencies were notably reduced when the customer

perceives something to lose if the balance is not repaid

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8
Prepaid cards

A "prepaid credit card" is not a true credit card, since no credit is offered

by the card issuer: the cardholder spends money which has been

"stored" via a priot deposit by the cardholder or someone else, such as a

parent or employer. However, it carries a credit-card brand (such as

Discover, Visa, MasterCard, AmericanExpress, or CAB and can be used

in similar ways just as though it were a credit card. Unlike debit

cards. prepaid credit cards generally do not require a PIN. An exception

is prepaid credit cards with an EMV chip. T’hese cards do require a

PlN if the payment is processed via Chipand PlN technology

PROBLEMS

Travelers from the U.S. had encountered problems abroad because many

countries have introduced smart cards, but the U.S. had not. As of 2010,

the U.S. banking system had not updated the cards and associated

readers in the U.S., stating that the costs were prohibitive. As of 201 S.

the smart cards had been introduced and put into use in the United States.

Other problems with credit cards have involved irlis-sold policies on top

of the products, such as the additional mis-sold policies which is still

causing problems for clients in the UK

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9
 C0gts Of Credit

The credit application or contract will disclose the terms and conditions

for the credit card use. The following terms and conditions will effect the

total cost of credit:

Annual Fee —A yearly charge similar to a membership fee, usually

ranges between $0 and $50.

Annoal Percentage Rste — The APR is the cost of credit expressed as an

(APR) yearly rate.

Finance Charge — The dollar amount paid to use credit, includes interest

and all charges associated with the transaction.

Grace Period — The grace period is the number of days you have before

a ctedit card company starts charging interest on new purchases. Not all

credit cards have a grace period.

Periodic Rate — The interest rate the card issuer applies to your

outstanding account balance to figure the finance charge for each billing

cycle.

Transaction Fees — Some credit card issuers charge a fee for a cash

advance, a late payment or exceeding your credit limit. There may be a

monthly fee if you do not use your card.

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0
 Credit Card Evaluation

The following factors should be considered to help you select the best

credit card:

The credit card interest rate - look for a low interest rate but remember

that the interest rate is not fixed.

The balance calculation method - helps you determine the total cost of

credit.

All charges and costs - some companies are adding other fees, such as

late payment fees if your payment arrives after the due date or transaction

fees every time you use the card. Also grace periods are shrinking with

some cards. Companies generally start the grace period at the time the

purchase is posted to your account. However with some cards, the grace

period can start on the day of purchase.

4 Services and features available - such as rebates, cash-back incentives

or extended warranties. These features should also be evaluated in terms

of the extra credit costs to you.

Read each credit contract carefully be sure you understand all the terms,

costs and conditions. The lender will give you a credit limit. However, it

is more important for you to look at your finances and decide for yourself

what an appropriate credit limit would be. Decide how many and what

type of credit cards would best suit you needs.

4
1
 Credit Availability

Your credit availability will depend on the following considerations:

4 Age. You must be 18 to obtain a credit card (unless you have a

cosigner). must have

Amount. The amount must be realistic, based on your income and

any

credit you already have.

Purpose. It should be for a good reason, such as a student

loan.

CREDIT CARD RESPONSIBILITIES

With your first purchase on a credit card, you have entered into a legal

agreement with the credit card company. You then must understand and

abide by the terms and conditions of the agreement. Some other

responsibilities are:

keep your cards with you or in a safe place do not give your credit card

number to friends before signing receipts, verify for accuracy destroy all

carbon copies keep all receipts to check against the billing statement

inform the credit card company immediately if you lose your credit card

Become familiar with the consumer credit laws that protect you. A mini-

lesson titled Women and Credit Laws will give you information about the

key provisions.

Most students, whether high school or college, feel that they are capable
4
2
of managing their own lives. You want to be independent of your parents.

To do this you must demonstrate that you can be a responsible money

manager. Using a credit card can either increase or decrease your

spending power, so if you team how to plan your credit use then you will

maximize your spending power. While in college, you may want to

obtain at least one credit card so that you can begin to establish a credit

history and you have a way to cover most emergencies.

Advantages and Disadvantages

Credit is a contract based on your promise to pay in the future for

goods and services you receive today. The advantages of credit cards

are significant and "plastic " can be an important resource in your

money management plan. Credit cards olTer protection against ‹halt of

your cash. You can purchase the products and services you need when

you need them, even if you do not have the cash in your pocket. Credit

cards are very helpful in emergencies, and many parents actual Iy

prefer that the ir students carry a credit card to pay for such essentials

as gas. repairs and tow ing. They feel more comfortable knowing that

their young adults have the ability to take care of any emergency

quickly with a credit card. Also. you can become a better money

manager as you learn to use credit responsibly. There are d isadvanta s

es. however. to using credit. When you carry a credit card, it is easy to
4
3
buy beyond your means. to spend so much that you cannot meet the

bill when it is due. When you carry a credit card, it is very easy to buy

un impulse and forget you are spending future income, money that you

do not yet have (and may not have in time). Moreover, if” you on)\ pay

the minimum balance each munth, you may be surprised to find out

how many years it w ill take to take to pay off the balance. 1 merest

chars es really add up to increase significantly the ”bottom 1 ine” of

the total of’ what you must pay. A lso. it is rarely wise to buy

something that will w'ear out before you finish paying lot it. such as a

vacation or a used bicycle

CLASSIF1CATION OF CREDIT CARD

Before we apply for a credit card it is always betler to know what type

of c red it card is best suited tu uur prcti Ie. Catering to different types

cf c‹›nsumcr needs. credit card ccmpanics issue several t\ pes ut” crcdit

cards. Each I}pe has its own benetits. They can be classified as

follows:

ATM Card: ATM cards allow customers to access their accounts at any

time-24 hours a day. every day of the year. lhrcugh Automated Teller

Machines. Customers can withdraw cash, transfer funds, tind out their

account balance and pertorm uthcr Bank ing and financial transactions

w ith the help uf A £Ms.

Debit Card: A debit card, I i ke an ATM card, directly accesses a

4
4
customer’s account. lt is a hybrid ot ATM and credit card. The card

directly debits a designaled say inks bank account. Whereas in the case

of c redit cards. a 8 race credit period of 20 to 50 days for making the

payment is avai lable, no such credit period is at lovved under debit

cards.

Prepaid Card: Prepaid cards are also known as Stored Value Cards’.

4“hese cards are with stored value paid in advance by the holder. The

card issuer and the service providcr are identical. They are also called

Lim ited Purpose Prepaid Cards which can be used for a limited

number of well -defined purposes.

Private Label Card: These cards are uniquely tied to the retailer issuing

the card and can be used onlv in that retailer’s stores. A bank. on the

basis of a contractual agreement with the retailer extends credit under

this type of card.

Affinity Group Card: These are credit cards designed for a

collection of indiv iduals with some form cf” common interest ur

relationship, such as profcssicnal, alumni, retired persons”

‹ganizations, sports teams, schools, ur scre ice organizations.

4
5
 CHAPTER - lV
DATA ANALh'SIS AND INTERPRETATION
DATA ANALYSIS FOR THE YEAR 2014:

Table showing market share of credit cards in India

Nalne of the bank Percentage of holding(%)

Axis bank
Kotak Mahindra Bank 8%o
lndusind bank ltd 6%
HDFC Bank ltd 27%
ICICI Bank 25%
Citi bank 18°

MARKET SHAREHOLDING OF PRIVATE BANKS IN INDIA IN

THE YEAR 2014 (IN PERCENTAGE )

■
Axis bank
m Kotak Mahindra Bank B
Indusind bank ltd

■ HDFC Bank ltd

B lClCJ Bank
+ Citi bank

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6
fire above table and pie chart represents the percentage of credit card

risers of various banks in the year 2014. The percentage of credit card

users of HDFC Bank was 27°.ñ. The percentage of credit card users of

ICICI Bank was 25%. The percentage of credit card users of Citi bank

was 18%. The credit card users of Axis bank was 16%. The credit

card users of Kotak Mahindra Bank was 8% and finally the users of

IndusInd bank was 6%.In private banks the major share of card

holdings in the year 2014 is of HDFC bank , followed by ICICI bank

and the least share of credit card holdings is of indusind bank.

DATA ANAYSIS FOR THE YEAR 2015:

Table showing market share of credit cards in india

Name of the bank Percentage of holding(%)

Axis Bank

Kotak Mahindra Bank 5%0

Indusind bank ltd 3%
HDFC Bank ltd 30%
ICICI Bank 27%
20%

MARKET SHAREHOLDING OF PRIVATE BANKS IN INDIA IN

THE YEAR 2015 ( IN PERCENTAGE)

4
7
 Axis Bank

m Kotak Mahindra Bank

Indusind bank ltd

m HDFC Bank ltd m

ICICI Bank

• Citi bank

The abuve table and pie chan represents the percentage of” credit

card users uf various banks in the year 2014. The percenta ge ot’

ctedit card users ot HDFC Bank was 30%. The percentage of credit

card users of ICICI Bank was 27%. The percentage of credit card

users of Citi bank was 20%. The credit card users of Axis bank was

1 S%. The credit card users of Kotak Mahindra Bank was S%

andFinally the users of Indusind bank was 3%.

I n private hanks the major share of card holdings in the year 2014

is ‹›t HDFC bank , rollowed by ICICI bank and the least share ut

credit card holdings is ct indusind bank

4
8
DATA AN A LYSIS FOR TH L Y EAR 2016:

Table showing market share of credit cards in india

Name of the bank Percentage of holding(%)

Axis bunk 10%

Kotak Mahindra Bank 7%
) ndusind bank ltd 7%
£tDFC Bank ltd 28%
ICICI Bank 30%
Citi bank

MARKET SHAREHOLDING OF PRIVATE BANKS IN INDIA IN

THE YEAR 2017 ( IN PERCENTAGE)

■ Kotak Mahindra
Bank
e Indusind bank ltd

m HDFC Bank ltd

m ICICI Bank

*. Citi bank

The above table and pie chart represents the percentage cf credit card

‹iscrs of various banLs in the year 2014. Use percentage of credit card

users of HDFC Bank was 28° o. The percentage ot credit card users of

lClCI Bank was 30%o. I lie percentage of credit card risers of Citi
4
9
biuiL v•'as 1 8%. The credit card risers tif Axis bank was 10° o. The

credit card users of Kotak Matt indra Bank was 7° o alid linail Y the

risers of lndusInd bank was 7°•o

In pn ate banLs tlJe major share of card holdiiigs in II c year 2014 is

of lC'lL I batit , roilou ed by HDFC bank and the least share of credit

card h oltlings is of indiisind bank and Kotak Mahindra bank.

DATA ANALYSIS FOR THE YEAR 2017 :

Table showing market share of credit cards in india

Name of the bank Percentage of holding(°fi)

Axis Bank
Kotak Mahindra Bank 8°O
Indusind bank ltd 7%o
HDFC Bank ltd 28%
ICICI Bank S0q J
Citi bank 1 6%

5
0
MARKET SHAREHOLDING OF PRIVATE BANKS IN INDIA IN

THE YEAR 2017 ( IN PERCENTAGE)

Axis bank

m Kotak Mahindra Bank R

Indusind bank kd

m HDFC Bank ltd m

ICICI Bank

> Citi bank

The above table and pie chart represents the percentage of credit card

itsers of various banks iii the year 2014. The percentage of credit

card users of HDFC Bank was 28%o. The percentage of credit card

users of ICRC i Bank was 30%é. I lie percentage of credit card risers

of Citi bank was 1 6%». The credit card risers of Axis bank was 11

%o. The credit car d users of’ Kotak Mahindra Bank was 8°fi and

finally the uscrs of ltiduslnd bank was 7° o

5
1
 CHAPTER - V
FINDINGS

The key to successfully writing your paper is organization (writing

skills hel p. too!). Here are some tips that may be helptul:

You should have a clear idea of your research hypothesis by now.

Make sure that this is stated clearly at the beginning of your paper

(or presentation). Summarize the artic les you have collected, identi fy

ing the main points. lf yuu have made a phutocop}’ of an article or

bock chapter, highlight the sentences or paragraphs that are most

applicable to your topic. Start writing the sections that are clearest to

you (these don’t always have to be written in order). Provide back

ground information and then add your supporting ideas. Once ycu start

writing ; ou u il I be able to identi by areas where }‘uu stil I need

more information. You can lhen develop a ncw targeted search

strategy to retrieve more inl ormation. Your concepts may be much

narrower than at the beginning stages of s our research.

Make sure that you have the correct c itations tier all of your

resources (d‹a n’ t wait until the last minute on this one). The format

of” your writing will di fler depending on the ex pectations for lhe

research. lt is important to prov ide in formation on where jou obtained

the information that was used in your research.

5
2
Present your research

The presentation cf research can take many formats, although

typically a paper or rcpcrt will be written to summarize the fi ndings.

Often, in addition to a written report, the teseatch needs to be

presented to classmates. colleagues or another audience. Sometimes

you want to include an audiovisual a id in } our presentation. I he

Harris Library has an extensive v ideo co I lection on a number

ot’ topics rel at ing to social work and soc ial welfare. lncrcasing!y

presentation software is heing used in group settings to share the main

ideas uf” a project.

5
3
 SUGGESTIONS

Bank investment decision whether strategic or tactical should be

discussed and finalized at the level of the mills itself.

The management of the mill at different levels should have a thorough

understanding of the investment decisions.

This would facilitate the management to effectively monitor and

control the implementation of the investment decision.

A standing committee, representing the different cadres of

management and a few workers, may be constituted to decide the

various issues related to capital expenditure decision.

The committee may seek the advice and support of the professional

bodies like SITRA and SIMA whenever necessary for scientific

formulation of project proposals.

The proposals are formulated without properly assessing the future

prospects.

The assumptions on which the projections made are also unrealistic.

Hence proper cace should be taken while assessing the future prospects

and making assumptions.

4 The mills follow a crude method of appmising the proposals. The

mills may very well evaluate the projects using discounted cash flow

techniques along with traditional methods as the mills have necessary

5
4
data for employing discounted or time adjusted methods.

4 Implementation should be carefully monitored by the personnel in

the mill at different level, to see that the projects are executed within

the timeframe and financial budget

This requires periodic review of the project implementation and

initiation

of corrective measures as and when required.

SUMMARY:

The main benefit to the cardholder is convenience. Compared to debit

cards and checks, a credit card allows small short-term loans to be

quickly made to a cardholder who need not calculate a balance

remaining before every transaction, provided the total charges do not

exceed the maximum credit line for the card.

Different countries offer different levels of protection. In the UK, fot

example, the bank is jointly liable with the merchant for purchases of

directive products over

£100.'*”

Many credit cards offer rewards and benefits packages, such as

5
5
enhanced product warranties at no cost, free loss/damage coverage on

new purchases, various insurance protections, for example, rental car

insurance, common carrier accident protection, and travel medical

insurance Credit cards can also offer a loyalty program, where each

purchase is rewarded with points, which may be redeemed for cash or

products. Research has examined whether competition among card

networks may potentially make payment rewards too generous,

causing higher prices among merchants, thus actually impacting social

welfare and its distribution, a situation potentially warranting public

policy interventions

Low introductory credit card rates are limited to a fixed term,

usually beMeen 6 and 12 months, after which a higher rate is charged.

As all credit cards charge fees and interest, some customers become so

indebted to their credit card provider that they are driven to

bankruptcy. Some ctedit cards often levy a rate of 20 to 30 percent

after a payment is missed.’3’* In other cases, a fixed charge is levied

without change to the interest rate. In some cases universal default may

apply: the high default rate is applied to a card in good standing by

missing a payment on an unrelated account from the same provider.

This can lead to a snowball effect in which the consumer is drowned

by unexpectedly high interest rates. Further, most card holder

5
6
agreements enable the issuer to arbitrarily raise the interest rate for any

reason they see fit. First Premier Bank at one point offered a credit card

with a 79.9% interest rate;" 9 however, they discontinued this card in

February 201 I because of persistent defaults.

For merchants, a credit card transaction is often more secure than other

forms of payment, such as cheques, because the issuing bank commits

to pay the merchant the moment the transaction is authorized,

regardless of whether the consumer defaults on the credit card payment

(except for legitimate disputes, which are discussed below, and can

result in charges back to the merchant). In most cases, cards are even

more secure than cash, because they discourage theft by the merchant’s

employees and reduce the amount of cash on the premises. Finally,

credit cards reduce the back office expense of processing checks/cash

and transporting them to the bank.

Prior to credit cards, each merchant had to evaluate each

customer’s credit history before extending credit. That task is now

performed by the banks which assume the credit risk. Credit cards can

also aid in securing a sale especially if the customer does not have

enough cash on hand or in a checking account. Extra turnover is

generated by the fact that the customer can purchase goods and

services immediately and is less inhibited by the amount of cash in

5
7
pocket and the immediate state of the customer's bank balance. Much

of merchants' marketing is based on this immediacy For each purchase.

the bank charges the merchant a commission (discount fee) for this

service and there may be a certain delay before the agreed payment is

received by the merchant. The commission is often a percentage of the

transaction amount, plus a fixed fee (interchange rate)

CONCLUSION

ñ The primary goal of this report is to identify action initiatives that

make up the Action Agenda for a New Millennium in order to foster a

responsive university climate where all faculty are valued equally and

treated with respect.

To that end, The Millennium Project Summary Report calls for an

increase in the number of tenure-track women taculty and faculty of

color at all ranks, including leadership positions; the analysis and

reallocation of workload responsibilities: the assurance of fair

treatment; equal access to resources; and the implementation of’

existing policies and the initiation of new policies and procedures.

The changes The Millennium Report proposes will not be realized

without institutional accountability to ensure that they are carried out.

As one faculty member observed, "What is needed is someone w ho w

5
8
ill enforce the policies that exist. There is just so much disregard of the

current policies.

Nobody has a way of checking on whether things are being enforced.

So get these results to the President soon, and make sure that there's

someone in there who is equitable and will enforce the policies." The

Millennium Report Action Agenda for a New Millennium will

inevitably evolve as the larger university community begins to work on

improving the campus climate. The goals of’ the Millennium Project

can only be real ized thrciugh continuing dialogue among all members

of the campus commun ity. Moreover, the Millennium Project can be

deemed a succcss onl y i1‘ the university administration. working in

concert with the faculty. moves forward to address the range of”

recommendations outlined in the rcport. Tc cone lude with the

wcrds of cne faculty member interviewed for the Prujcct: "Don't let

this Millennium Project sit in a big folder and nut be acted upon!"

The delivered prototype demonstrates that hbz otters a platform tor

developing a scalahle production system ot” the OER World Map

v•‘hich provides max imum data connectivity and reusability.

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