When people didn't have enough money to buy things, the only way to get the needed amount was to get a loan from the bank. Nowadays, the person can buy these in advance using a credit card.
Many banks offer this as a way of generating more revenue for the company. Agents are sometimes sent to kiosks in malls or in the streets offering the forms for free. Once the applicant's documents are processed, it will be mailed to the home or the office and can be used when it is activated.
Credit cards save money by letting the person get an item without reducing the cash carried in the wallet. This is paid later on when the statement is sent to the home giving a summary of the purchases made during the previous month.
The companies that offer credit cards earn money by charging a certain interest rate on the purchases. This happens when the individual can't pay the amount in full which will be carried over in the bill that will be added to the expenses sent in the succeeding month.
The only way the cardholder can avoid these extra charges and penalties is by paying the bill in full and on time.
Failure to pay can prompt the company to repossess the items, the foreclose of the client's assets as payment and a bad credit rating preventing the borrowing of new loans until there is an improvement in the customer's status. Those who spend too much then should solve this immediately or with the help of others.
Many people are able to maintain a good credit rating making banks send other cards with the hope of landing an account with the same client. The only way these cards can be activated is by calling on the customer hotline. These should be cut and thrown away preventing anyone from using it if the person isn't interested.
The credit card can be used locally or internationally. Foreign countries will only honor these if it is affiliated with firms such as MasterCard, VISA or American Express. The bill will be reflected in US dollars since these will be converted depending on the current exchange rate.