Calculation of Credit Card Interest on daily bases

Calculation of Credit Card interest can be defined in this way if you charge your Credit Card to buy a cellphone Rs 20000/= and your credit card limit is Rs 250000/= then your limit remain Rs 230000/= now outstanding charged amount is Rs 20000/= here if your APR (Annual percentage rate) is for example 22% and you have to pay for 30 days then credit card interest calculation can be defined as below.

APR                                                           22%
   
Credit Card Limit                                Rs 250000

Less:Charged Amount                         Rs 20000

Remaining Limit                                 Rs 230000

Now you have to charge interest on Credit Card charged amount for 30 days.

Charged amount  multiply number of days spend.

                                                       Rs 20000   x   30 days =    Rs 600000

now calculate first day charged amount divide Rs 600000 by 30.

                                                        Rs 600000   /   30  =          Rs 20000

APR /number of days a year                     22%  / 365   =          0.06027397%

                                                      0.6027397%   x   30 =          18.082191%


now multiply charged amount to monthly interest rate.

                                             Rs 20000   x 18.082191% =         Rs 3616.4382 per month

this is the calculation of  Credit Card Interest.
                    

Credit Card Process

A Credit card process can be defined as a customer or a client of a bank goes for the credit card acquisition application to bank for credit card process a relationship manager of a bank get the signed application of credit card from a customer and receives necessary documents for further credit card process credit card application then computerized by the bank but here are some banks they are offering online acquisition of credit card application for credit process and application goes to credit analyst for approval after approval credit application forward to credit disbursement and plastic card making department and then issued to customer at his or her signed address this credit card process been done by the bank.

When a customer receives the card and then wants to buy goods or services from any other retailer then he or her purchases goods or services, for payment a customer gives the credit card to the retailer he swipes the card from merchant machine and gives the bill to the customer. A merchant machine forwards the detail of the customer online to the bank this all over credit card process between a customer and a bank.

What is Credit Card?

What is credit card? A Credit card is a small plastic card supplied by a bank to develop society, etc., permitting the card holder to purchase goods or services on credit and repay them in full.

In other words what the credit card is? Banks produce revolving account and award a line of credit to the borrower, from which the borrower can borrow money for payment to a merchant or as a cash advance. ... A credit card obliges the balance to be repaid in full each month.

These were the simple explanations of what is credit card?

Types of Credit

There are some different types of Credit that are defined as under.

• Installment loans, including auto loans, student loans and furniture purchases
• Mortgage loans
• Bank credit cards
• Retail credit cards
• Gas station credit cards
• Unpaid loans taken on by collection agencies or debt buyers
• Rental data  

Installment Loans

Installment loans is a loan that a borrower pay back the credit after a certain period of time with a fixed schedule that is called Installment loan.

  Mortgage Loan

Mortgage loan is a loan where lender demands security so any property is taken as a collateral and then pay the borrower a certain amount of money to pay back with a fixed schedule.

Bank Credit Card

Bank credit card is a card that is issued by the lender (Bank) to borrower to receive goods and services and payback to the lender with plus amount.

The lender (Bank) initiates a revolving account and awards a line of credit to the borrower, from which the borrower can borrow money for payment to a merchant or as a cash advance.

Retail credit cards

Retail credit card is also called a store credit card where a lender (Store may be) can issue a retail credit card to its customer for a certain limit as a third party of regulator where customer shops goods and services from any store and get befitted from the store like discounts,free shipping etc.. 

Gas station credit cards

This changed into done to avoid a credit card interchange fee which raised the price of gas notably. The first business fuel cards resembled a credit score card with a name and a employer logo on them. When a consumer entered a fueling station, the cashier might take down the consumer's name and corporation facts.