Issuing Of Credit Card

Credit cards are important elements of personal finance as they are the widely used financial tools these days. The networked system and structure of a credit card makes it protected and easy to use and allows payments made through a plastic card without any misuse or fraud. There are mainly three main parties as far as credit cards are concerned; they are listed and explained below:

Card Provider: VISA, MasterCard, JCB, and American Express are some examples of the available card providers. One can see their logos well displayed in shopping centers.

Card Issuer: financial institutions such as banks and their subsidiaries issue the credit cards. These cards will have both the logos of the financial institution and the card provider like VISA, MasterCard, and JCB.

Card Acquirer: the card acquirer can process the cards in any of the shops or stores where it is accepted and this service is normally called credit card processing or merchant account services.

The credit card processing services have varied work fields and they also accept the processing of other financial transactions like gift cards, debit cards, etc.

The main task of authorizing the credit card is instantly done by the credit card processing organization and then it is issued to the merchant. This card issuing organization then debits the card issuers account and credits their account with the purchase amount of the cardholder. The card processing services acquired in the card issuer pays the transactions. The credit card services organization after taking a transaction-processing fee issues the payment to the merchant.

Listed below are various steps towards processing of the credit cards:
Document Verification

The first step in processing is the verification of the documents given by a person applying for the credit card. It is to make sure that the documents are genuine and that there is no fraud involved. Credit card issuing organization pays much attention to verifying the address and income of the applicant.

Then the credit history and credit scores of the applicant is checked thoroughly as these factors have a critical role in deciding the credit limit of the credit card. The credit card issuing organization verifies credit record of the applicant available in the credit bureau and then gives this updated information to the institution for further necessary action.

Security Verification

Security verification has greater importance in fixing the credit limit when dealing with secured credit cards. All the necessary security information is collected during the credit card processing. The security file contains information such as the property value, confirmation of ownership, and any liabilities on the property.

Issuing of Credit card to the applicant

When the procedures of verification of security and credit history are completed, the last step is issuing the credit card to the applicant. Generally it will take one or two days for this process to complete.

The meticulous checks for credit card processing are necessary for an organization to verify the genuineness of the papers put in by the applicant. It also confirms the authenticity of the credit card issuer. Thus the elaborate verification and checks are advantageous for both the parties to stop any fraud.  

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