A credit card gives you credit - obviously for a charge. The days of credit one gets could range from 20 - 50 days depending on the date when one made the purchase. You can choose to pay your entire dues at one go, or pay the minimum amount due every month. Besides this, it entitles the member to a lot of benefits like travel discounts, discount on retail loans etc.

A Charge card is similar to a credit card with one major difference. With a charge card you have to pay the entire dues within the credit period and cannot carry over any balances like a credit card.

A Debit card enables you to access your bank account for payment. When you make any purchases using a debit card, then your bank account is instantaneously debited to the extent of the purchase amount.

In India there are basically three types of cards namely Visa, Master Card and Amex. Participating banks like ANZ Grindlays, BoB then issue these cards to the subscribers. Both Visa and Master Card have been popular in India and Amex a relatively new player in India as it issues its cards only through American Express Bank.

Gold, Silver and Classic/Executive are the terms used by issuing banks to differentiate between the levels of services offered on each. On the premium segment is the gold card, which gives higher insurance covers, more privileges and discounts. Here an element of prestige forms an important factor for subscribing to such cards but it comes at a cost as these cards have the highest fees and service charges associated with them.

Cash is always riskier to carry, besides the limit to the amount you can carry in your wallet. Credit cards are advantageous as not only can you spend up to your given credit limit without having to worry about carrying cash, but also issue cheques against your card limit and order drafts over the phone. Credit cards entitle you to other benefit like discount at shops, restaurants and airline tickets. Most credit cards also offer personal accident cover, lost baggage cover, etc. You get interest free money for 45 to 50 days. A global card assures you of spending in any currency and settling your dues in your home currency.

The fact is that a credit card can only postpone payment, not waive it. The charges for carrying over the outstanding balance amount over and above the free credit period can touch around 36% on an annualised basis.