Credit card is an unsecured lending product with many terms associated with it. Let’s understand a credit card and associated terms.

Credit card details: When you hold your credit card, it contains lot of information. Here are the various details present on a credit card:

  1. Issuer name: Issuer or the financial institution which lends the money: Example: American Express, Citi etc.
  2. Card name: Name of the credit card like Quicksilver or Double Cash.
  3. Card number: 15 or 16 digit card number
  4. Expiration date: Expiration date of physical credit card. It is not the expiration date of card account. Issuers generally renews a card in good standing before expiration date
  5. Name: Name of the card holder
  6. Network: Payment processing network. Example: Visa, MasterCard
  7. Magnetic stripe: Strip on the card which is used to make payment by swiping the card at the POS terminal
  8. EMV Chip: Computer chip on the card which is used to make payment by inserting the card at the payment terminal. These chips are more secure in protecting user data
  9. Contactless symbol: A small chip is embedded inside the card which emits short range radio waves to make payment by tapping the card at the payment terminal. Payment is initiated when the card is tapped or placed near the payment terminal.
  10. CVV Number: It is a 3 or a 4 digital number at the back of the card. It provides additional security when making purchases online or on phone. It is extra layer of security to avoid unauthorized transactions.
  11. Signature: Space for cardholder’s signature.


  1. Credit limit: Maximum amount you can spend on a credit card.
  2. APR: Annual Percentage Rate: APR is used for interest calculations
  3. Network: Network which processes the payment. Example: Visa, MasterCard
  4. Balance transfer: Transfer balances from one issuer to another issuer.
  5. Minimum payment: Payment amount which must by paid by the due date mentioned on the statement.
  6. Cash advance: Interest is charged on cash advances from transaction date
  7. Prime rate: Interest rate that a lender or a bank will charge to creditworthy customers.
  8. Variable APR: Variable APR means the APR will vary by the changes in Prime Rate.
  9. Penalty APR: APR which is applied on a credit card account when the customer defaults on the agreed terms. It is generally higher than regular APR.
  10. Late payment fees: Fees charged when minimum payment is not made by the payment due date mentioned on the statement.
  11. Authorized user: A person who is allowed to use the card but is not liable to make the payments
  12. Utilization: Balance/Credit Limit
  13. Billing cycle: A fixed period which is generally 30 days or monthly for which statement is generated.
  14. Statement: Statements are generated for each billing cycle which contains all transactions. Each statement has a start date and end date for transactions and shows balances due at the end of billing cycle with the due date of making the payment.

3. Acronyms

Acronym Expansion
APR Annual Percentage Rate
CVV Card Verification Value
BT Balance Transfer
EMV Europay MasterCard Visa
POS Point of Sale
PIN Personal Identification Number
ADB Average Daily Balances