Glossary

a  | b  | c  | d  | f  | g  | i  | m  | o  | p  | r  | s  | w

A
Annual Fee (see also Fee)
Different credit card companies charge an annual membership fee which helps to defray the costs incurred by users in handling accounts.
Automated Teller Machine (ATM) (See also Cash Advance)
This allows customers to make banking transactions anywhere, anytime. By using a debit or ATM card at an ATM, individuals can withdraw funds from their checking or savings accounts, make a deposit or transfer money from one account to another. Cash advances using a credit card at an ATM can also be obtained. Keep in mind that transaction fees may be charged for using another bank's ATM. Fees for cash advances are typically charged at 5-6% of the amount withdrawn, or S$15, whichever is greater.

Back to Top


B
Balance Transfers
A balance transfer allows you to transfer your balance from one credit card to another. If you have a credit card balance that you don't expect to pay off in a month and you have another credit card with a lower interest rate, transferring your balance to the lower rate can save you money.

Back to Top


C
Cash Advance
A user can get "on the spot" cash with his/her credit card at a bank or ATM. The amount of the cash advance is deducted from his/her available line of credit. A fee of 5-6% of the amount withdrawn or S$15 is typically charged for cash advances.
Charge Cards (See also Payment Cards)
Charges to these cards must be paid in full each month that a statement is issued.
Credit
An arrangement between lender and borrower whereby the lender lends money to the borrower who agrees to pay the debt — with a finance charge.
Credit Cards (See also Payment Cards)
These are a type of payment card involving a revolving line of credit granted to the cardholder. It provides flexibility, allowing you to pay your bill in full or in increments during a period of time. Should you choose not to pay your bill in full each month, you will be required to make at least a minimum payment and pay finance charges on the remaining balance. Credit cards are issued by banks, credit unions and some stores such as department stores and gasoline companies.
Credit Company/Issuer
Institutions providing a line of credit to the consumer through a credit card are called credit companies. These may include banks as well as stores such as department stores or gasoline companies. MasterCard Worldwide is not a credit company.
Credit History
A record of an individual's or a company's past borrowing and repaying, including information about late payments and bankruptcy.
Credit Limit (See also Credit Line/Line of Credit)
The maximum amount of credit that a bank or other lender will extend to a debtor, or the maximum that a credit card company will allow a card holder to borrow on a single card.
Credit Line/Line of Credit (See also Credit Limit)
A type of credit in which a bank undertakes to provide credit to a client during a predefined period. The client may either withdraw the credit amount all at once, or make a certain number of withdrawals during the specified period.
Credit Report
A record of an individual's or a company's past borrowing and repayment history on loan facilities with banks and financial institutions.

Back to Top


D
Debit Cards/Automated Teller Machine (ATM) Cards (See also Payment Cards)
Debit and ATM cards are types of payment cards that offer a safe, convenient alternative to cash and checks. They allow you to access your bank accounts anywhere by using an ATM. The basic ATM card allows you to withdraw money directly from your checking or savings account. Access to the account is restricted by a Personal Identification Number (PIN). A debit card is similar to an ATM card, but it also can be used for purchases at merchants. The purchase amount is deducted directly from your bank account, so there are no interest charges. Fees for exceeding your balance can be charged. If your bank card has a MasterCard logo, you can use it anywhere MasterCard is accepted.

Back to Top


F
Fee (See also Annual Fee)
Sometimes you may find extra charges or fees on your monthly credit card statement if you use special services, such as cash advance or balance transfers. You may also be charged fees when you make late payments or when you charge amounts over your card's credit limit. Fees for late payments and exceeding your credit limit can be avoided with smart management of your account. Be careful—these fees can add up quickly.
Finance Charges (See also Interest Charges)
A finance charge is the total cost of a loan in dollars and cents. It includes interest, service and transaction fees and other fees charged on the loan.
Full Payment (See also Payment Options)

Back to Top


G
Grace Period (See also Repayment Period)
A period of time, usually 25 days long, during which no interest charges are assessed for purchases made. For example, if the cut-off date on your credit card is May 1, you have until May 25 to pay off the balance in full. If you do so, you will not be charged any interest. If your payment arrives after May 25, or if you don't pay the balance in full, you could be assessed interest charges from the date of purchase as it was recorded. Some accounts do not have a grace period, which means that interest is charged on purchases from the day they are made as they are entered.

Back to Top


I
Interest Charges (See also Finance Charges)
The price paid to a lender for the use of the money loaned. Interest is charged as a percentage of your remaining balance. This percentage, or interest rate, may vary from card to card.
Issuer
Institutions that provide a credit line to a consumer through a payment card are called issuers. Issuers can include banks, credit unions or savings and loan associations, and retailers such as department stores or gasoline companies. MasterCard Worldwide is not an issuer.

Back to Top


M
Merchant
Location or store where purchases are made.

Back to Top


O
Online Banking
Online systems allow customers to plug into a host of banking services from a personal computer by connecting with the bank's computers over the Internet.
Outstanding Balance
The total amount of money owed to a financial institution after a payment is made. For example, if you have a $500 balance on your card and pay $100 when you receive your account statement, your remaining balance is $400.
Over the Limit
Over the limit is when the borrower has accessed a greater amount of money than what is available in his/her line of credit. Depending on the credit company, the user will be charged an "Over the Limit" fee.
Overdraft
When withdrawals from a bank account exceed the available balance, giving the account a negative balance.
Overdrawing an Account
Withdrawing more money from a checking or savings account than what is available. This results in a fee and/or your transaction may be declined.

Back to Top


P
Payment Cards
The most familiar types of payment cards are credit, charge and debit cards. These financial tools allow consumers to make purchases online, over the phone or in person at merchants across the world.
Payment Options
With most credit cards, you have a choice between paying some or all of your monthly balance.

  • Partial payment - Partial payment allows you to make a "minimum payment" of your total balance due. The rest is "revolved," or added, to the next month's statement. Revolving a balance almost always means that you will be charged interest on the remaining amount. You should always pay at least the minimum amount due by the due date to avoid late payment charges. Paying more than the minimum due will also shorten the amount of time it takes to pay off your credit card balance.
  • Full payment - Full payment means you have repaid your total balance. Doing so usually means that no additional finance charges are applied. Certain cards such as "charge" cards require full payment each month.
Personal Identification Number (PIN)
Secret code you choose for your card that enables you to access your money or perform banking transactions through the ATM as well as make purchases without signing a sales receipt at merchants that have PIN pads. Your PIN should not be shared with anyone.

Back to Top


R
Repayment Period
A period of time, usually 25 days long, during which no interest charges are assessed for purchases made. For example, if the cut-off date on your credit card is May 1, you have until May 25 to pay off the balance in full. If you do so, you will not be charged any interest. If your payment arrives after May 25, or if you don't pay the balance in full, you could be assessed interest charges from the date of purchase as it was recorded. Some accounts do not have a grace period, which means that interest is charged on purchases from the day they are made as they are entered.
Rewards Program
A program that allows you to accumulate reward points based on purchases or transactions made on your card. These points can be redeemed for the particular program you enrolled in (e.g. airline, petrol, etc.) Banks may charge annual fees to participate in rewards program.

Back to Top


S
Secured Cards (See also Credit Cards)
Secured cards are a great "first step" to building a good credit record for those with damaged, little or no credit history. This type of credit card requires a security deposit in order to be able to establish a line of credit. Typically, your line of credit will be equal to the amount deposited with the bank or financial institution that issued the card.

Back to Top


W
Worldwide Acceptance
With acceptance at over 28.5 million locations worldwide, no payment card is more widely accepted globally than MasterCard.

Back to Top


a  | b  | c  | d  | f  | g  | i  | m  | o  | p  | r  | s  | w