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Credit Cards

Process Flow of Issuance of Credit Card Facility

  • Either the customer approaches the relationship manager or apply online.
  • relationship manager request for the relevant documents i.e. KYC and other relevant documents.
  • The documents are handed over to the Credit team for sanctioning of the facilities/limits of the customers.
  • Credit team verifies the document’s, assess the financial and credit worthiness of the borrowers and issues a credit limit to the customer in CBS and allots a credit card.
  • Credit Card is physically transferred to the customer’s address.


Process Flow of Sale - Authorization process of Credit Card Facility

  • Customer swipes credit card on the POS machine (Point of Sale) at merchant’s shop/establishment.
  • POS sends authentication request to the merchant’s bank which forwards it issuing bank through credit card network (such as VISA, MASTER CARD, AMEX, RUPAY) where it is validated. It happens in fraction of seconds.
  • the approval message is received from issuing bank through card network to the merchant’s bank and POS machine.
  • The receipt of the transaction is generated and the sale is completed. The transaction made is charged during the billing cycle of that month.






Process Flow of Clearing & Settlement process of Credit Card Facility

  • Merchant transfers transaction data to the merchant’s bank. Bank clears settlement amount to Merchant after deducting Merchant fees and forwards list of settlement transactions to the credit card network which then provides the list to the credit card issuing bank.
  • The credit card issuing bank clears the amount to Merchant’s bank but after deducting interchange transaction fees.
  • At the end of billing cycle, card issuing company charges the customer’s credit card account with those transactions.

Risks and Controls around the Credit Card Process



Key Controls

Customer        master        not                         defined       in accordance of disbursement certificate

Authorization         by      authorized                                 personnel                     only segregation of duties like maker, checker check.

Inaccurate        interest      /     charge                          being calculated in the Credit Card system.

Interest is automatically calculated by CBS as per defined rules..

Credit Line setup is unauthorized and not in line with the banks policy.

Credit committee checks Financial Ratios, the credit facility and amount offered is as per banks policy.

Credit Line setup is unauthorized and not in line with the banks policy.

Authorization should be restricted to authorized personnel.



Credit Line setup can be breached.

Transaction not permitted if out- standing amount exceeds the credit limit assigned to customer.

Inaccurate reconciliations performed.

Daily reconciliation of the transactions updated in the credit card system on card network level

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