| Annual fee |
a yearly charge imposed by some credit
card providers in order to cover expenses such as administration costs. |
| Annual percentage rate |
see APR |
| APR |
stands for ‘annual percentage
rate’. A figure, expressed as a percentage, which incorporates the interest
charged upon the credit card as well as any additional fees. |
| ATM |
stands for ‘automated teller machine’,
another term for a cash machine. By inserting either a credit card or debit card
into a cash machine and entering your PIN you can withdraw cash from an ATM. |
| Balance |
this term refers to the total amount
that you owe your credit card provider and includes charges such as interest and
fees. |
| Balance transfer rate |
the interest rate that will be charged
on any balance transferred from a previous credit card onto a new one. |
| Cash advance |
this phrase is used to refer to the
practice of withdrawing money from a cash machine using your credit card. There
is usually a charge imposed for this service. |
| Charge card |
this is a type of credit card often
favoured by businesses on which the balance must be paid off in full each month. |
| Credit limit |
a figure denoting the maximum balance
that you are allowed to reach on your credit card. |
| Credit reference agency |
organisations that specialise in providing
credit reports that assess an individual or business’s credit risk. |
| Credit report |
an assessment of an individual or a
company’s credit risk. These reports are composed using a variety of informational
sources and are used by lenders in order to judge applicants. |
| Interest |
interest accrues at a fixed percentage
and is the charge that the lender imposes on the borrower for the granting of
credit. |
| Interest free period |
the period during which no interest
will accrue on credit card transactions, usually around 25 days. |
| Introductory rate |
an initial period where the customer
is charged a reduced interest on their credit card. This can apply to purchases,
balance transfers, or both. |
| Minimum repayment |
this is the minimum amount that you will need to
pay back each month on your credit card balance. It will usually be calculated
as a certain percentage of the total amount. |
| PIN |
this stands for ‘personal identification number’
and is issued to a credit card holder in order to enable them to use ATMs to withdraw
money. |
