A

Index

So. No.

Chapters Name

Page no.

1.

Title page

2.

Preface

3. 4. 5. 6.

Student Declaration Content page Introduction

Main Material

7. Glossary 8. Bibliography

INTRODUCTION

1. INTRODUCTION (Plastic Money) :

Plastic money or polymer money, made out of plastic, is a new and easier way of paying for goods and services. Plastic money was introduced in the 1950s and is now an essential form of ready money which reduces the risk of handling a huge amount of cash. It includes debit cards, ATMs, smart cards, etc. Credit cards, variants of plastic money, are used as substitutes for currency. This book on plastic money is divided into two sections titled Concepts and Experiences. The former covers articles on the emergence of plastic money, different types of plastic cards and their growth in India and other related issues. An experience discusses the experiences of banks like Standard Chartered, Citibank, which deal with plastic money and their growth in the market.

M EANING:
Plastic money refers to credit cards, you use them whenever you want and pay later (with interest, of course). It makes it too easy for people to buy things they normally could not afford, which makes it easier to get into debt.

DEFINATION:
A slang phrase for credit cards, especially when such cards used to make purchases. The "plastic" portion of this term refers to the plastic construction of credit cards, as opposed to paper and metal of currency. The "money" portion is an erroneous reference to credit cards as a form of money, which they are not. Although credit cards do facilitate transactions, because they are a liability rather than an asset, they are not money and not part of the economy's money supply. Plastic money is a term that is used predominantly in reference to the hard plastic cards we use every day in place of actual bank notes. They can come in many different forms such as cash cards, credit cards, debit cards, pre-paid cash cards and store cards.

2. HISTORY OF PLASTIC MONEY : Paper money was first used in China around the seventh century AD, only to be outlawed in 1455. The use of folding currency re-emerged in England in 1694. The biggest problem which was occurring with the paper note is the wear; the paper note has very small life due to shifting of ownership by time to time and their usage.

Firstly Australia was the first who develop the plastic note which have longer life but after wore they are recycled for further utilizing. The plastic notes also secure the government for copying because paper note easily copied but plastic note cannot be copied. A u s t r a l i a l e a d s t h e w o r l d i n p l a s t i c b a n k n o t e t e c h n o l o g y . D u e t o t h e problem faced with the paper note the invention of plastic money has been introduced. The paper money has small life cycle and cant be recycled but as compared with the plastic money which has long life cycle and can be recycled Plastic pace. There one problem arise that we cannot keep the huge amount of cash with us so they give the idea of Plastic cards which known as plastic money accepted worldwide and we can keep the huge amount with us while going a n y w h e r e i n t h e w o r l d . T h e p l a s t i c m o n e y m a k e s t h e s o c i e t y a s c a s h l e s s societies. As the usage of plastic cards are increasing the number of supplier are also increased. Some suppliers (Bankers) are charging the hidden charges and high interest rate. The agent who convince the people to get the credit card by offering the wonderful packages but in reality agent is hidden some important fact which was disclose after the receiving of the bill. In the 1950s, payments cards were extremely exclusive even though they had annual fees of only $25 to $30. Cards were only useful during this period for paying at upscale restaurants, hotels, and other travel and entertainment destinations. money is secured and cannot be copied. As we know that Australia was the first country to have all polymer banknotes, but the rest of the world is also growing at a fast

ENTRY OF PLASTIC MONEY:

First payment cards was introduced in the USA, in1920. Diners Club and American Express launched the worlds first plastic cards in the USA, in 1950. First credit card was introduced by Diners club in1951. Citibank and HSBC were the pioneers in the Indian credit card market in the 1980.

PLASTIC MONEY IN INDIA:INDIANS GET ELASTIC WITH PLASTIC MONEY

In the last two years, spending pattern through plastic money has changed drastically. Travelling, dining and jewellery are the top three purchases that Indians make through credit cards. Two years ago, it was jewellery and apparel purchases that formed the largest chunk of purchases through plastic money. Fuel accounts for a very small portion of credit card purchases as these are largely paid through debit cards. The credit card companies say that consumers spend Rs 50,000 crore annually which is expected to grow at 50% over the next 4-5 years. "Travel has definitely become much larger a segment than what it was two years ago. Airline tickets, both domestic and international, are now bought through credit cards making it the largest category for credit card purchases," said ICICI Bank, head (credit cards) Sachin Khandelwal. With air travel becoming affordable and eating out a regular feature in Indian households, the trend will only gain momentum in future feels experts. Travel and dining corner about one-fourth of the total credit card purchases which signifies the shift in Indian spending habits. Earlier, purchases of both consumer durables and jewellery items were larger than the hospitality segment. Going forward, this trend should continue. "Jewellery, consumer durables, fuel purchases, apparel are a much smaller segment than travel and dining which comprise the largest chunk of credit card purchases. Eating out has in fact become a big concept now," says HDFC Bank VP and head (credit cards and product portfolio) Parag Rao. Experts say, while travel and hotel bills along with dining, account for about 25-35 % of the total value of purchases through credit cards, purchase of jewellery accounts for 10-11 % of the purchases . Apparel purchases account for 8-10 % and consumer durables like TV and mobile phones account for nearly 6-7 % of the purchases through plastic money. Two years ago, the figures were largely skewed in favour of jewellery and apparel purchases while travel and hospitality was a small component. With 87% of all transactions in plastic money happening through credit cards, debit cards in India continue to be used largely for cash withdrawals. There are about 65 million debit cards in India of which State Bank of India alone accounts for 25 million debit cards. ICICI Bank is said to have 11 million cards. This is largely in line with the fact that both the players are the biggest banks in India and will have the highest number of savings accounts.

Utility payments are another segment where more payments are being made through plastic money in the last two years. Credit card is one of the fastest growing businesses in financial services in India. There are currently 25 million credit cards in India and ICICI Bank is the largest player with 8.5 million cards issued. Citibank, SBI-GE Card and HDFC Bank are the other prominent players in the sector.

FUTURE SCENARIO OF PLASTIC CARD MARKET IN INDIA

The use of plastic cards in India has no doubt in rise from last few years but there is still a great potential left for the bankers to introduce more attractive services in order to lure the customers on one side and increase their profits on the other. Some aspects or facts (organized from various studies and articles) which are contributing to the growth of plastic cards market and also indicate its growth in the near future are discussed below: * The credit card companies say that consumers spend Rs 50,000 crore annually which is expected to grow at 50% over the next 4-5 years since 2007 (Economic Times, 19 September2007). * According to CLSA Report, the estimated credit card base in India till 2020 will be 127 million as compared to 23.1 million in 2007. * The number of debit and credit card users in India is anticipated to reach 73.4 million and 406 million by the year 2010 and 2011. * According to an RBI announcement, by April 2009, bank customers will able to use their ATM cards to withdraw cash from any automated teller machine installed by various commercial banks across the count and too free of cost . * According to a new RBR report on Global ATM Market and Forecasts Till 2011, India is likely to invest heavily in ATMs till 2011. * Leading Indian banks are said to target a ratio of 1: 2.5 for bank branches v/s ATMs by 2012. This means the number of ATMs will grow to around 1.75 lakh, assuming the number of branches remains at the same level (The Hindu Business Line, 29 November 2007).

* In late 2007, most of the companies had announced plans to convert their credit/debit cards to smart cards by replacing the magnetic stripes in them with computer chips and in cooperating latest encryption technologies. So it would not be long before smart cards established themselves in India (Arunachalam L. and Sivasubramanian M., 2007). * A joint venture between Life Insurance Corporation of India (LIC) and GE Money is likely to launch its first credit card product in 2009 which will be offered only to LIC customers and policy holders

(Vardhaman, 2008). * In another positive development, ABN AMRO with India's travel portal MakeMyTrip.com launched a distinctive cobranded credit card, 'Go Card' in 2008. The card offers special reward benefits and good range of travel-related promotions and packages (vardhaman 2008). * Banks in India are looking at deploying biometric ATMs targeted to reach the unbanked population in rural India. Using thumbprint and voice guidance in ATMs reduces literacy requirements to a considerable extent. Thus, establishing the identity of a rural depositor through biometrics makes it possible for illiterate or barely literate people to become part of the banking user community (Murali D. and Jaishankar P., 2007).s * There are already 1.6 million customers using smart cards banking solution and that figure will go up to 4 million by the end of March 2009 and will reach to 25 million in five years (Sen A., 2008). Hence, the future prospects of plastic cards in India are bright enough to bring paradigm change in its popularity among customers as well as banks. Until now, the growth and usage of plastic cards has been seen more in urban areas due to existence of more literate people, better infrastructure facilities and proper awareness as compared to rural areas. The rural people can only understand their regional language and most of them are even illiterate who are least aware about the usefulness of plastic cards. Moreover, there is lack of adequate infrastructure to push the development of cards and induce more innovation. Thus, most of the banks have now planned to expand aggressively into rural India, where about 60% of the population lives, using an innovative system based biometric cards through which customers will be able to do anytime anywhere banking on their own. The arrival of malls, multiplexes, online shopping stores and shopping complexes encourage the customers to make use of plastic cards. However, operational risk involved with the usage of plastic cards like chances of fraud, card damage etc. plays the negative part too (Retail Payment System, 2004). Moreover, some customers are not able to utilise cards effectively due to its complex nature and they don't actually know how to operate it for specific purpose. Thus, the banks should give them some training regarding its usage. The banks can also provide them facility to use plastic cards on trail basis so that they can become more confident while using their own cards. However, all these hurdles will diminish over time and positively influencing trends are expected to continue in the near and far-future. Also, the growth of plastic cards in future would depend upon the capacity building of the banks to meet the challenges and make use of the opportunities profitably. However, the kind of technology used and the efficiency of operations would provide the much needed competitive edge for success in plastic cards business. Furthermore, in all these customers' interest is of paramount importance .

TYPES OF PLASTIC MONEY:A credit card is a method of payment and it can make payments on behalf of cash. And you can use your credit card in any time for to buy a product or a service and itll be the standard payment method to your merchant or service provider. But it should be an acceptable credit card for that merchant or service provider. And you can get cash withdrawals using your credit card and normally we called it a Cash Advance. So a credit card is a legal payment method and its designed on a standard to accept by the merchants and other banks like a check or a paper money or a coin. You can see cardholders name, credit card number and expire date in face side of a credit card and the signature on its backside. There are different kinds of plastic money.

CREDIT CARD

When you do a transaction using a credit card, you dont need to pay your hard money to merchant or to Credit Card Company instantly. That transaction amount will paid by credit card company to merchant and then you can pay it to credit card company in next month or during your billing period. And credit card company offer the facility of paying your payments during given period and in installments. To the installments Credit Card Company adds their monthly interests and then you have to pay your balance with their interest monthly. The previous month bill including the interest was the subject of the loan in the following month. A credit card has the provisions of the limit that applied to all the member depended on the card type (Silver, Gold and Platinum), minimum amount to pay from the total balance of the bill (like 5%, 10%) and if not paid that amount then fall due that was determined. And if not paid during the billing due date bill amount would subjected to the late payment fee as big as certain percentage from minimum amount and sometimes it will be a fixed amount for a month.

DEBIT CARD

To use a debit card you may have a bank account with the credit card company or the bank, because this transaction proceed as like the cash transaction, because of this only if this card holder had the enough available balance to cover the transaction amount can transaction could be only carried out, after the transaction, transaction amount directly credited from the card holders account and debited to merchants account in the very same time. If you use a debit card you can do card transactions if have the balance in your account for the transaction and when you did a sale transaction using the card it is a cash transaction by not using cash but the paying off or payment was carried out by means of reduce (debiting) from the balance of the account of the credit card holder and then increase (Crediting) the account of the merchant as much as the transaction to the manager of the bank.

 CHARGE CARD

When use a charge card, it could be used as the payment implement of a trade transaction of product or the service. Then the cardholder has to set off the entire outstanding amount fully at the end of that month or in the following month with or without the additional charges and fees. Normally, the charge card dont have the provisions of the credit limit and card holder has to do full payment of all the transactions before the next statement and without used percentage the interest, but card holder not paid full outstanding amount then he has to pay a additional charge called delay fine for his next statement.

AMEX CARD

A m e x s t a n d s f o r A m e r i c a n E x p r e s s a n d i s o n e o f t h e w e l l - k n o w n charge cards. This card has its own merchant establishment tie-up sand does not depend on the network of MasterCard or Visa. This card is typically meant for high-income group categories and companies and may not be acceptable at many outlets. There are a wide varieties of special privileges offered to Amex cardholders.

DINNER CLUB CARD

Dine club is a branded charge card. There is a wide variety of special privilege offered to the Diner club cardholder. For instance, as a card holder you can set your own spending limits. Besides the card has its own merchant establishment tie-ups and does not depend on the network of master card or vise. However, since this card is typically meant for high-income group categories, it may not be

acceptable at many outlets. It would be a good idea to check whether a member establishment does accept the card or not in advance.

GLOBAL CARD

G l o b a l c a r d s a l l o w y o u t h e f l e x i b i l i t y a n d c o n v e n i e n c e o f u s i n g a ccredit card rather than cash or travelers cheque while traveling abroad for either business or for personal reason.

CO-BRANDED CARD

Co-branded

cards

are

credit

cards

issued

by

card

companies

that

have

tied up with a popular brand for the purpose of offering certain benefits to the consumer. A d e b i t c a r d w i t h a d i f f e r e n c e .

exclusive

MASTER CARD & VISA

MasterCard and Visa are global non-profit organizations dedicated to promote the growth of the card business across the world. They have built a vast network of m e r c h a n t e s t a b l i s h m e n t s s o t h a t customers worldwide may use their respective credit cards to make various purchases.

SMART CARD

A smart card contains an electronic chip which is used to store cash. This is m o s t u s e f u l w h e n y o u h a v e t o p a y f o r s m a l l p u r c h a s e s , f o r example bus fares and coffee. No identification, signature or payment authorization is required for using this card. T h e e x a c t amount of purchase is deducted from the smart card.

PHOTO CARD

I f y o u r p h o t o g r a p h i s i m p r i n t e d o n a c a r d , t h e n y o u h a v e w h a t i s known as a photo card. Doing this helps identify the user of the credit card and is therefore considered safer. Besides, in many cases, your photo card can function as your identity card as well S m a r t c a r d d u r i n g payment and is collected by smart card reading machines. No change is given. Currently this product is available only in very developed countries like the United States and is being used only sporadically in India

ADVANTAGES OF PLASTIC MONEY

Plastic Money is a must need of our busy life. Today it is very easy to carry money without having a lot of cash or gold. Keep Credit or Debit cards and forget the cash money. This is a new idea of present lifestyle which has made money transition so easy that anybody can carry it with him or her in a pocket. Today plastic money is the best alternative of the cash. It is also safer to traveling with a plastic money card than cash. If it is stolen you may contact to bank immediately and can block your money from getting stolen. It gives you also better option as extra purchasing capacity, protection of money and much more. Like wise advantage plastic money has disadvantages also. Now we would study of following advantages as well as disadvantages

Purchasing Power: Credit or Debit cards made it easier to purchase things. Now we dont
have any need to carry hard cash in a large amount. Plastic money is accepted everywhere, anytime.

Time Saving: Through a credit card or debit card you can purchase anything from anywhere
without spend money on fare or cash transition. Just provide your card details to seller store or

companies and finalize your order. Now you dont have need to worry about time wastes. Use internet for minimum time consuming.

Extra Safety: While you are not carrying cash, how can it be lost? But if your card has lost,
just contact to your bank or financial institution, which provide you cards. It will block the account and nobody can draw a single coin without your permission. So it is 100% safe without any tension.

Credit Limits: You get an extra amount to spend with your card. This extra spent money you
can return before a fix time schedule or you will have to pay a little interest. So there is no problem to having less money. Just use money without any tension and

A need of emergencies: Think, that you have no time to go to bank or someone to get
money, what will you do? Definitely you will use your credit or debit card which will give you confidence for your difficult time. We can say it a true friend which help us in need.

Additional features: Mostly credit card offer additional benefits, as discount from some
particular stores, bonus in airline fare, free insurance policies and much more. This discounts and bonus encourages you to purchase more things as it is good for us

Now we can see the importance of credit cards and debit cards as plastic money. Plastic money has made life easier, simpler and fast then before.

DISADVANTAGES OF PLASTIC MONEY

We cant ignore the necessity of plastic money in our life. This is the one among most important needs of our life. Plastic money or credit/debit card was a new idea in its starting but it was welcomed by the people because of its usability and benefits. There is no doubt that credit/debit cards are useful and essential for us but they have some isadvantages as their uses. To be habitual of cards may be harmful. Here we will read about disadvantages of plastic money.

Over Budget: Plastic money gives us an easy and extended purchasing capacity which
results in an extra and unwanted buying. These cards give us discounts and bonus also on particular stores or items, which encourage us to get them and we use our hard earned money for a non-required thing, which affects our budget and we cant handle our monthly budget system.

Increased Debt and High Interest Rates: Credit Card provider financial institutions and
companies charge high interest rates (may be 10% to 25%) on extra money if you fail to pay off

up to the fix date of the month. This interest is their earning, for which they give you extra buying limits then your money. This is not a good idea that you owe loan on high interest rates and spend it in unnecessary things or purchasing. This is complete money wastages.

Fraud: Credit cards can be stolen. A thief may be use them directly or to get their information
(which is required in money exchange). In todays technical intelligence it is also possible to get a clone of any credit card or debit card, which works like original and they can be give you a heavy financial loss. So be aware from credit cards fraud as they are like stolen your money from your pocket without your information.

How to avoid disadvantage of plastic money

As we have discussed earlier that credit cards has disadvantages as well as advantage. We cant stop the use of credit cards but we can keep precautions to ignore any possibility of harm of misuse of cards. Likewise: Remember, credit cards is not a money generating machine, it is a facility, so use it as a help. Dont be slave of purchasing. Keep track of your purchase and spending. Before spending money from credit card think for a minute that it is necessary or not. If it is not necessary, then deny its buying. Dont cross your budget limits. Dont forget to repay the loan from credit cards, otherwise you will have to pay more money which will also affect your budget, so it is good to repay before due date to avoid any interest charges. If you lose your credit card of wallet, report it your credit card provider company and ask them to stop the functioning of card to avoid any theft of money from your account. Dont give your credit cards details on online or someone else if it is not trusted. Your card details may be stolen from websites so deal with only trusted and well prestigious companies websites. Have a habit to check your credit card statement regularly. It will help you to make sure about your purchasing.

OBJECTIVES

Objectives of the study of :1. To study the use of plastic money (debit cards, ATMs, smart cards, Credit cards). 2. To know the requirement of plastic money in banking sector. 3. To analyze the benefits of plastic money. 4. To study attractive services in order to lure the customers on one side and increase their profits on the other

DATA ANALYSIS

PLASTIC MONEY: A KEY ELEMENT OF ELECTRONIC BANKING

Money is always regarded as an important medium of exchange and payment tool. Initially barter system was used as the significant mode of payment. Over the years, money has changed its form from coins to paper cash and today it is available in formless form as electronic money or plastic card (Ramasamy et. al., 2006). Hence, the major change in banks which has been brought in by technology is through introduction of products which are alternative to cash or paper money. Plastic cards are one of those types of innovations through which the customers can make use of banking services just by owning the card issued by bank and that too without restricting himself in the official banking hours. Plastic cards as the component of e banking have been in use in the country for many years now. However, the card-based usage has picked up only during the last five years. Payment by cards is now becoming a much preferred mode for making retail payments in the country (Report on trend and progress of banking in India 2006-07, RBI). Thus, plastic cards are such payment tool which gives a customer an opportunity of non cash payment of goods and services and are designed to facilitate small value retail payments by offering a substitute for bank notes and coins and thus to complement traditional payment instruments. The role of various parties involved in plastic cards payment (Retail Payment System, 2004) is shown as below:

(i)

Customers or Cardholder: The authorized person holding the card and can use it for purchase of

goods and services also. (ii)

Card issuing bank: The bank or institution which issues the card to its eligible customers. Merchants: Entities which sell the goods and services to the card holder and duly for agree to

(iii)

accept the card payment. (iv)

Bank Card Association: The associations (VISA, Master Card, American Express) which act as

an intermediate between card issuing bank and merchant's bank and authorize the transaction.

PLASTIC MONEY GAINING CREDENCE IN INDIA

A year before economic reforms kicked off in 1991, Citibank stole a march ahead of its competitors and became the first bank to launch a credit card in India. Fifteen years later, the pioneer has been upstaged by a homegrown bank, ICICI Bank , which has raced to the top position in less than four years with more than 3 million cards. That's a frenetic market for you. The New York based major has been beaten but not disgraced. With about 2.5 million card holders, Citibank is at second place. Standard Chartered Bank, at third spot, has issued about 1.78 million cards, and plans to extend its reach to 25 cities by the end of 2005. Close on its heels is domestic behemoth State Bank of India (SBI) which has crossed 1.5 million cards within two years of launching the card. HDFC Bank is at fifth place with a million cards on its books. HSBC is fighting hard to be in the reckoning with over 900,000 cards.

Economy driving spends: A thriving economy, substantial increase in disposable incomes

and consequent rise in consumer expenditure, growing affluence levels and consumer sophistication have all led to a robust growth in credit cards, and each of the players mentioned above have posted an enviable annual growth rate of more than 100% over the last two years. There is no doubt that more and more middle class Indians are letting plastic rule their day to day lives. Five years ago, there were 4.3 million credit cards being used in the country. That zoomed to 6.5 million in 2002. A year later that shot up once again to around 9 million credit cards. Today, even if debit cards are overtaking credit cards in popularity, the scorching pace of growth continues unabated.

Venture InfoTech, a consumer payment processing company, estimates that the total spends in the credit card payment industry in 2003-04 was close to US $ 5 billion at merchant establishments. This reflected a growth of 28% over the previous year. Projections for 2005 range from 10-14 million cards according to Electronic Payments International. According to another forecast put out by the Lafferty Group, India's credit card spending is estimated to grow at 34 per cent in 2005.

Standout features: An explosive growth in volumes has not dented quality nor profitability,
and the Indian card market is at par with the best in the world. Here are some indicators.

Profitable usage: Credit cards can be used online with a separate

security number to prevent misuse. This has increased profitability. An estimate by Business Standard in early 2004 reckoned that Citibank's profits on the card business were over US $ 34 million and StanChart's was around US $ 23-34 million. Among the Indian banks, SBI Cards was estimated to be the most profitable with over US $ 11.6 million as operating profit.

Growing reach: Indian Railways which runs one of the largest travel booking sites in Asia and
offers door-delivery of train tickets if booked online using credit or debit cards. Credit cards are now increasingly being used to pay for even school fees and hospitalization expenses.

Safe and sound: Safety standards followed by players to prevent misuse match the best in
the world. For example, any transaction above a particular sum is automatically referred to the issuing bank which calls up the cardholder in a matter of seconds on the mobile phone to confirm the purchase.

Feature-driven: Product features too match the best anywhere in the world. Almost all credit
cards come with standard frills such as free accident insurance, medical insurance at a heavy discount and much more. The cardholder is offered the option of converting a big purchase made on credit card into a loan at a lower rate of interest spread over a long period. Banks now offer details of expenses incurred on credit cards under different heads - such as food, clothes and jewellery - to enable easier tracking by the customer. E-mail alerts and mobile alerts on credit card details are commonplace.

Aggressive marketing: Banks have not only raised the bar in quality and services but they
have also devised aggressive growth strategies to notch up higher spends on cards. Over the last four years, the bank has also built up the most extensive network of sales, service infrastructure and collection mechanism for credit cards across 107 cities including smaller towns like Vapi, Valsad and Bhuj in Gujarat and Siliguri in West Bengal. Not that competition has been staying quiet. As soon as ICICI Bank came out with the cash back scheme, Citibank decided to introduce a new cash back card on the lines of its popular Citibank dividend card in the US. Other players too have already announced their plans to take on the top two.

Growing beyond metros The growth in spending has so far been spearheaded by the
burgeoningmiddle class in major cities, where consumer spending is concentrated on lifestyle and luxury goods. Spending in rural areas has been mainly in cash. This has begun to change. By issuing credit cards at 107 cities, ICICI Bank has established the largest reach. SBI, the largest bank in the country with over 9,000 branches, has fanned out its credit card business in 45 cities. Citibank, which operates in 40 cities, is planning to scale it up to the 94 cities in which group company City financial operates. When the plastic revolution spreads, many farmers could be using credit cards to buy seeds and fertilizers. That would, in fact, put an end to the reign of unscrupulous money lenders in rural hinterland.

Huge market remains untapped

The most heartening part of the growth is that so much still remains to be covered. Consider this: only 2.4% of the working population in India owned a credit card in 2004. McKinsey predicts that 35 million credit cards will be issued by 2010 with an outstanding balance of over $7 billion. Compared to other Asian markets, Indian credit card market is still at a nascent stage. Credit cards per bankable population in India is 0.03 per person against 3 in South Korea, 2.66 in Taiwan, 2 in Hong Kong, 1.1 in Singapore and 0.4 in Malaysia. According to Mr. V Vaidyanathan, senior general manager and head - retail products, ICICI Bank, an average Indian credit cardholder spends less than $500 on his card annually, compared to around $800 in Sri Lanka and over $3,000 in Hong Kong and Singapore. Outstanding dues on credit card (which are the money spinner for any card issuing bank), are the lowest in the region. The outstanding balance in India is at $1.5 billion, compared to $90 billion in Korea, $10 billion in Hong Kong and US $2.5 billion in Malaysia. In other words, the credit card market in India could continue to register the current blistering growth in the medium to long term. That should be music to the ears of banks looking for a slice of an increasingly affluent Indian consumer.

DATA INTERPRETATION

The collection of the data is followed by the analysation of the data, which further is followed by the interpretation of the data. This step enables the researcher to interpret the results which have been obtained from the analyzation of the data. According to C. William Emory, Interpretation has two major aspects namely establishing continuity in the research through linking the results of a given study with those of another and the establishment of some relationship with the collected data. Interpretation can be defined as the device through which the factors, which seem to explain what has been observed by the researcher in the course of the study, can be better understood. Interpretation provides a theoretical conception which can serve as a guide for the further research work.

Interpretation of the data has become a very important and essential process, mainly because of some of the following factors-1. Enables the researcher to have an in depth knowledge about the abstract principle behind his own findings. 2. The researcher is able to understand his findings and the reasons behind their existence. 3. More understanding and knowledge can be obtained with the help of the further research. 4. Provides a very good guidance in the studies relating to the research work. 5. Sometimes may result in the formation of the hypothesis.

SOME FACTS OF PLASTIC MONEY (CREDIT CARD)

The first card was issued in India by Visa in 1981. The country's first Gold Card was also issued from Visa in 1986. The first international credit card was issued to a restricted number of customers by Andhra Bank in 1987 through the Visa program, after getting special permission from the Reserve Bank of India. The credit cards are shape and size, as specified by the ISO 7810 standard. It is generally of plastic quality. It is also sometimes known as Plastic Money.

CONCLUSION

Conclusion:It has been revealed that the preference to use of plastic money/ credit card has its pros and cons with its usability and affordability. According to the consumer behavior, in this subject it has been analyzed about plastic money that its a form of conditioning and acts as a stimuli which qualifies a consumer. While the preference to use plastic money / credit card is also effected by its affordability which is its use in connection with the prediction for future income which has already been confirmed by Howells (1995) where they found that the preference to go for credit spending is resulted due to an increase in income. Another arousing facet besides the usability and affordability of plastic money is influence of the people around who has the same mode of payment utility. In the developing country like Pakistan, Where there is a mad race to be better than the other and to be dominant and having a flaunting appearance, plastic money is used. It comes in the part of status-quo in a given environment. Credit card is a form a routine activity to buy diverse products and services even online. With this notion in mind, some consumers are laid-back and do not pay their credit card bills on time, which causes a charge of interest on the due payment. In this way, the consumers tend to acquire a self-risk due to slackness which often turns this easy money into risky money.

BIBLIOGRAPHY

Newspapers Economic Times Times of India

Websites o o o http://www.allcreditcardsreview.com/advantages-of-plastic-money/ http://www.allcreditcardsreview.com/disadvantages-of-plastic-money/ http://articles.economictimes.indiatimes.com/2007-09-19/news/27684912_1_debitcards-credit-cards-sachin-khandelwal o http://www.thehindubusinessline.com/features/investmentworld/article2840227.ece o http://www.hindustantimes.com/business-news/UtilityBytes/Indian-use-of-plasticmoney-in-strong-surge/Article1-733652.aspx

http://www.moneycontrol.com/news/business/plastic-money-gainingcredenceindia-a-report_213440.html

Magazines o o Books Plastic money and modern banking - Krishan Kant Upadhyay Business Today Business World