Money, money circulation and credit. Коллектив авторов

      As on January 1, 2010 banks issued 7.6 millions of payment cards and the quantity of these cards holders reached 7.1 million people (against the analogue period of 2009 – growth on 6.5 and 7,0 % consequently). The most widely-spread payment cards are cards of international systems, their share reached 97.1 %, local systems – 2.1 %.

      In December, 2009 the transaction volumes with payment cards usage of the Kazakhstans emitters composed 300.6 billion tenge (the growth in compare with December, 2008 composed 18.4 %). The transactions’ quantity for December, 2009 reached 12.6 million and increased against December, 2008 to 14.1 %. Whereby the growth of wire transfers quantity reached 23.8 % (2.2 million transactions) and the quantity of cash withdrawal operations – 12.2 % (10.3 million transactions).

      Plastic cards are manufactured from a special plastic and basically have a standard size: 2.125»x3.375» (about 53.9x85.6 mm.) and width – 0.039 (~ 0.76 mm.).

      Plastic cards can be classified according to a variety of parameters. One of the main is an intended purpose. Cards can be devided on banking (sometimes they are called payment) and nonbanking (identification, club and discount).

      Banking cards are supposed to be issued and used for performing of banking operations: opening of the accounts, settlement and cash services, currency trading, etc. Such card is a long service result of banking system of payment mechanism improvement and an integral feature of a modern human.

      This card contains the following information: on the front the name of holder, number, term of validity, emitting bank logotype and payment system logotype are recorded. Some cards have a hologram either as one of protective means from forgery and on the back side of card there are a place for holder’s signature, magnetic stripe, sometimes holder’s photo and logotypes of cash machines’ net where a card could be cashed.

      Card’s number consists of 16 figures: the first six figures are an emitting bank code (Issuing Bank), the following nine figures are a banking card number (a number of card-account) and the last figure is confirming.

      Payment card is a personalized payment instrument which offers its holder a possibility of cashless payment for goods and/or services and of encashment in the bank’s divisions (branches) and in the banking cash machines. The trade/service enterprises and bank divisions which accept the cards form a net of servicing points (or receiving network).

      As electronic data storage device payment cards are divided on cards with magnetic stripes and cards with chips (microcircuits). The first are called magstripes and the second – smart cards or chip cards.

      Cards with magnetic stripes have magnetic stripes on the back side which keep data including card’s number (banking current account), name of a holder, date of expiry (VISA, EUROCARD, MASTERCARD). Magnetic stripe doesn’t contain an information about the holder’s account status.

      When card «passes through» a point-of-sale terminal it reads out a number of holder’s banking account from a magnetic stripe after that the terminal connects to a banking processing center in order to receive a confirmation about the required sum availability. Otherwise speaking the bank’s permission of an emitter is requested to perform an operation using this card.

      Bank’s permission to perform an operation by means of banking card which constitutes bank’s obligation to transfer money according to settlement document drawn with its help is called authorisation. Upon the bank’s permission receipt a point-of-sale terminal prints a slip (a special trade check) in three copies: one for buyer, second stays in trade enterprise and third should be sent to bank for payment. On the basis of presented slip the bank debits the card’s holder account and transfers money to the trade enterprise account.

      Integrated circuit card (smart card) – memory card. Instead of magnetic stripe it has a built in microcircuit (microprocessor) which itself keeps an information about holder’s banking account current status and confirms availability (or absence) of required sum. As a result the speed of such cards authorization in passing through a terminal station is much higher – 5-10 seconds. Their information capacity is much bigger than the cards with magnetic stripes have but they are more expensive.

      One of modifications of smart cards is «an electronic wallet». The conception of its creation is quite new and only high-powered card systems make its issue. Unlike the common plastic cards the electronic wallets are not linked to the client’s current banking account absolutely. It is «charged» on a definite sum of money thus the settlements made with its help do not require any authorization.

      During an electronic wallet purchase in bank in the form of a definite type of card it is «empty». It could be purchased by a some money place to a common account which wouldn’t be refilled before the full write-off this sum. This sum is an amount of an electronic wallet’s «charge», i.e. this sum is at holder’s disposal during the purchases of goods and services. When the sum will be exhausted an electronic wallet could be «charged» again.

      As can be seen from the above it plays role of a sort of a money vault electronically. Due to its limited capacity its loss doesn’t result any heavy losses thus it doesn’t require any costly systems of protection and holder identification, i.e. it is anonymous.

      Nowadays magnetic cards are most popular. But experts say that smart cards are future. Recently a substantial increase of exactly this type of cards usage as a mean of payment is observed.

      Cards could be separated according to identification information spread method (card holder name, number, term of validity, etc.). These data could be inserted by an embossed print (pressed) by a special machine (embosser) and this card is called embossed.

      On non-embossed cards this information is burned out and as a rule such cards are intended only for an electronic usage.

      According to the functional characteristics banking cards are separated on credit cards and debit cards. Credit card allows its holder to receive a definite credit during the payments for goods or services the cost of which is higher than a bank account balance pegged to the card (card account).

      The debit card owner can make payments for the purchased goods and services and to cash it in the cash machines only up to the amount available on the card account. In the USA the credit cards prevail, in Kazakhstan – debit cards which consist the bigger part of all payment cards.

      Both credit and debit cards can be individual and corporate. The individual cards (Customer cards) are issued only to private persons and corporate – only to companies (enterprises).

      Corporate card is linked to a companies’ account and can be issued only on a companies’ employee for payment of expenses coming from his business activity and official trips.

      In a frame of cards classification on individual and corporate to a separate