Corporate Social Responsibility (CSR) - What does it actually mean cover

Corporate Social Responsibility (CSR) – What does it actually mean?

Corporate social responsibility, which is known as CSR, is a type of mechanical business model that can help a company to be socially accountable and responsible to all the stakeholders and the public related to the interests of the company. With the help of corporate social responsibility, a company can be socially accountable to the people, and it means that it owes something to them. It is a type of corporate citizenship that a company has over time.

First of all, CSR helps in image building formation. 

With the help of the corporate social responsibility, a company can be conscious of the type of image that it creates to the society and impacts on the well-being of the people, directly and indirectly. There is a lot of impacts that the company can source out to the public. This can be done with the help of the economic, social, and environmental kind of ways.

If your company wants to engage in the work of corporate social responsibility, then they have to socially responsible for the well-being of the public whose interest lies in the company. It has to operate in such a way that it can be good and enhance the presence of the company, socially or culturally.  

Corporate social responsibility in India

When it comes to India, then it is the leading source of business from all around the world. It is the first country that has made corporate social responsibility CSR mandatory, which the help of passing a law in the amendment in April 2014. With the help of these companies act passed onto by India, now businesses can directly invest their profit into the area of the society, they can help the community to have a better formation for the further source, and in the best way, CSR becomes a hunger for every company out there in the market.  

tata trusts Corporate social responsibility

Company’s Act passed for maintaining CSR by Indian Companies

According to the whole of the company’s act, which was passed onto by India, it was sourced that the net worth of any business will now be a part of the CSR here. To the net profit of about 5 crores made by any company, around 2% of the same target is to be spend around for the well-being and management of the society as a whole so that the community can profit from the revenue which is managed by these companies.  

Before the same, India made it mandatory for the companies to disclose all their corporate social responsibility reports to the stakeholders and the shareholders of the company. 

They should be liable and should be a part of the company’s profit-earning capacity as well. These were included for the projects related to the company’s activities and the projects that were related to the activities taken by the company on-board.  

It was recommended all by the CSR committee as a whole to cover all the items listed in the source of the Companies Act, which was stated during the time of amendment. 

Also read: What is Corporate Governance? Principles, Examples & More

What is the whole methodology of the CSR Technique?

With the help and including CSR for companies out there, it can help them to profit and earn them for the scope of the long run. It is the procedure of assessing all the impact of the organization on society and then slowly evaluating all their responsibilities. These responsibilities, which are managed by the group of organizations that uses CSR is to help the community become a better place by distributing the part of the revenue which is made and even sourcing out the following aspects which are presented below.

1. Channeling the needs of the customers

The customers are the central part of it. With the help of the customers, an organization can run smoothly. With the use of corporate social responsibility, a business can go in for the long drive of run with the source of the customer that they have. It can help them to the pan and rule out the odds.

2. Helping the suppliers to earn

Another one which comes on the second lot is the suppliers of the business. A business can only profit when the suppliers are pleased. These are done with the help of corporate social responsibility. When the part revenue is distributed, the suppliers can be happy and supply more for the business and include their service for a longer time.

3. Creating a proper work environment

The environment where the business is incorporating should be steady, as well. If the climate is not stable, then a company cannot lead its growth and go towards the best. This is why corporate social responsibility can help to enhance the working environment, inside and out of the organization.  

4. Helping the communities

The communities are a huge part of society. These are the forums and groups through which the whole nation is based. If the business has to go for a longer duration, then they have to please the community members. This is done with the source of CSR and maintaining a cordial relationship with the communities of the society for a better outcome of results from altogether. The cities are the prime, and any organization should know it.

5. Providing comfort to the employees

The last one who lies here is the employees of the organization. If the working members of the organization are pleased, then only a business can run. Labor is what every organization needs out there and especially if they are skilled enough to do the job. CSR helps to have a proper relationship between the business and the labor.

Also read: Top 10 Companies in India by Market Capitalization

Legislation management for CSR

The most effective plan of corporate social responsibility for any business is to create legislation and to comply with it. Their investment for the source of the company should be a part of the whole society, and every decision that a company takes, the community should be a wholesome concern. The investments are a part of growth for any type of business out there, and only when the growth helps the community to lean towards the work of a company, the organization can have a more profitable revenue for the working years.  

Organizations in India always thrives for corporate social responsibility

There are a lot of organizations located in India which thrives on the source of corporate social responsibility and have benefitted from the whole idea. They have to take special CSR initiatives altogether, which can help them to integrate the cause and to work on the entire business process on the run. With the upcoming years in the market, all these have become an endless source of income for the business as a whole, and it has helped them to gain revenue.  

Besides growing your business, you should respect the culture and the beliefs of the people who are around you. With the help of respect, it creates a massive value of the business in the eyes of the public. It can help them to shape the business, which can be sourced out to a higher chance of collecting more revenue.

Businesses tend to profit more

With the help of CSR, an industry can source out their impending management and shape their responsibilities altogether. It can help them to understand the community at a large and also tend, adhere to the needs of the city. Companies do have a specific source and type of demand, which can help the department and the teamwork towards the development of particular purposes.

CSR management in Indian companies

CSR programs help the whole business to work for separate budgets and then support them in a wholesome way. It can improve the business to scope out the primary source of profit by looking after the well-being of society. When it comes to managing the source of work, then companies do have a specific source of the department which handles the work of corporate social responsibility. These are the departments that set up the policies of the CSR and then come up with freshly integrated ideas.

January 6, 2020 Economics, News No comments yet
5 Most common money myths you need to avoid cover-min

5 Most Common Money Myths You Need to Avoid

When you start earning, then a lot of people will tell you a ton of things to follow. Do you know why? Because when you are making more than people will be jealous of you and rather than being the motivation in your life, they will try to bring you down. But since they can’t hurt you in any way, they will create myths inside your head. These money myths are common and are happened to believe by a lot of people out there. Even the educated part of your society believes in it.

What are these money myths?

Well, these are common money myths which are needed to be avoided at any cost because they eat up your brain and does turn inside it. They are usually really harmless, but they come with a lot of misconception about earning. For instance, it does not harm you to believe in them, but them surely takes up a lot of time in your thoughts. For example, you might have heard your family members saying this and that when you are earning. And at some point in your life, you have believed in them. Well, these are just common, and they are random myths.

5 Common money myths to avoid right now

Here are the most common money myths you need to avoid right now.

Myth #1: You have to be rich to invest

Money myth - you have to be rich to invest

You want to make investment, but you have to be rich enough for them. You might laugh at this myth right now, but this is true, and a lot of people believes in it. And You don’t have to be costly for your investment. Investment can be done by a lot of people and especially if you want to have a secured future for yourself.

Finance is the part where you draw your own money, and there is always a risk to it. But you don’t have to be rich enough to do it. There are a number of investment options available which require very minimum monthly commitment like investing in ETFs, Mutual Funds, Index funds, direct equity investment etc. Moreover, Investment is the best way to grow your wealth. Believe it or not. We have seen people increase their wealth with the source of small systematic financing alone.

Myth #2: Savings cannot be done enough if you don’t earn enough

Money myth - savings cant be done if you do not earn enough

Savings are always a crucial part of your life. You don’t have to earn enough for that. If you want to save, then you can do it even if you are making 2k per month. It does not depend on what you make, but it solely depends on how much you are willing to think about your future.

Do you know that if you save at least 5% of your income in your bank, then it will amount to a lot more than what you can think of? Your savings are an integral part of your life, and you should never believe in this myth at all. If you save, then you are doing a favor for yourself and your family too.

If you are struggling with your budgeting, a simple rule that you can follow is 50/20/30 principle. According to 50/20/30 strategy, you should allocate 50% of your monthly income on ‘Needs’ (like rent, food etc), 20% of your monthly income on ‘Savings’ (like your retirement fund, investments etc) and the remaining 30% of your monthly income on your ‘Wants’ (like traveling, dining out etc). You can read more about 50/20/30 principle here.

Myth #3: You should leave your money management to hired experts

Money myth - you should leave your money management to hired experts

Don’t leave your money management on your financially educated partner or your family member or to a high priced financial advisor. If you are earning, then you should handle by on your own. It’s just a myth that you need to hire someone to manage your money. Always remember that whatever you are winning belongs to you and only you. And that’s why managing your own money efficiently is an important skill that everyone should learn.

For example, if you’re trading in equities or commodities from your earnings, always make sure to trade only that much money which does not affect your family even if you lose a bit. Similarly, if you’re actively involved in an online slot game, make sure to read everything possible about the game, have a strong strategy and a certain budget decided upon. This way you can manage your financials better without depending on anyone.

Myth #4: Investing in gold is always safe and better

Money myth invest in gold is safe and better

Always if you earn more, then you have to invest in gold. That is an absurd myth, and a lot of people believes and invests in gold. A large proportion of the Indian population considers Gold as one of the best options to invest in India. Here, gold is not only treated as a satisfactory long term wealth creator but also auspicious and a symbol of social status.

Anyways, Gold is a long term investment option and not suitable for earning short term gains. Moreover, the prices of Gold fluctuate in a cyclical manner. Therefore, one cannot expect Gold to perform well all the time. Overall, if you are seeking a regular source of income through your investments, Gold may never serve this purpose. However, if you want to hedge your existing investments in Equities and Bonds, you should consider investing in Gold.

Myth #5: Buying a home rather renting a place

Money myth buying a home rather than renting a place

You should hire a home, and you should not rent one is one of the most common myths which you will hear. A lot of people out there will explain this absurd point to you. Well, buying a home gives you better security, an area which is there for you and where you can count your name in.

But the decision of buying vs renting a home is not going to be the same for every individual. Whether you want to buy a house property or take it on rental, it totally depends on your financial situation. If buying accommodation suits my financial situation, it may not suit yours. Moreover, both the options are having their own perks and shortcomings.

Money myths are pervasive

Yes, myths regarding money are prevalent. Make sure that you are earning better and doing the best thing for yourself as well. If you are drawing and spending, then you are no useful than the rest of these people. You need to save your cash for future purpose, invest in options where you see that there is a built-in potential for you. Once you have found out your subject, it will be good enough for you.

And if you are afraid of spending cash a lot more to what you need, then you can opt-in for the credit card usage as well. Credit cards are right for you, and they help you to manage your budget and even stops you from overspending. Nonetheless, whatever be your situation, always try to avoid the money myths discussed in this article.

December 8, 2019 Personal Finance, Save money 1 comment
What is Complexity bias? And how can you deal with it?

What is Complexity bias? And how can you deal with it?

Complexity bias means that the complex concepts in our lives are better than the ones which are more straightforward. It is a way through which our brain is hardwired to think that using the source of complexity bias in our lives, and we can have a productive ordeal. It is a logical fallacy that leads us to believe that the complex problems are better and they are happening. The whole term of complexity bias denotes that people are instead devoted to their time on these kinds of approaches rather simpler, faster, and easier to solve.

Examples of Complexity Bias

Simple things made Complicated... Here are some of the most common examples of complexity bias.

1. The use of Jargon in everyday life states the fact that complexity bias is a part of us and how we use the source of complex behavior management to get. When you are trying to talk out of something or trying to evade a type of argument that is going among you and other people, then you will tend to think that using long and big words can help you to keep out of the trouble and the mess. It can keep you safe, as well.

2. Coming to the source of mathematics, let me prone an example here. When you were a kid or let us take an example of when you were in high school, did you think that the complex mathematical problems are accurate? This means that people often tend to believe that if a problem is harder to conceive, then it can say that there is a valuable quantitative insight into that problem, and it needs to have a better approach towards the whole solving issue. This is how our brain presents us with the same.

3. Another example here is the use of the software. When it comes to the management and the use of software, then you can check to see that the complex ones are the ones that you tend to like. Do you know why? Because this is a product of complexity bias as well. If we think that software is sophisticated, then our mind races into thinking that the use of the software can be kept and put together into different means. It will yield fruitful results just because the software has a complex nature and approach.

How can complexity bias be a problem for you?

Well, if you cannot asses the problem now, then let me tell you, a complexity bias into your behavior can tend to do a lot more damage than you think. Do you know why? Because with the use and sourcing of our mind into thinking that a complex behavior will help us to change routes, we tend to do things and tend to adhere to those things which can only show and procreate as complex in front of us. It can be wrong because it can cause a lot of problems later as well.

Regularisation is a fundamental concept which happens and takes place in our mind. For example, when we see people who are taking care of their management and business and doing the things they love, then we do tend to extend our behavior with respect to do. The same happens when we set our goals in life. If we have a more straightforward nature and a way of accomplishing those goals, then we tend to overthink and realize that they are not really what we want.

For example, if you are earning right now, then you might tend to of your taxes at the same time. Well, if you have the complexity bias, then your mind will fool you into thinking that the bigger the problem, the better will be your answer. A lot of people do believe that their goal can only be achieved with the use of sophisticated means, and this entirely happens to the inner sane that we create within us. The same happens and takes place with the source of complexity bias here. With the use of this terminology, people tend to think that the complex their life problems are, the better they can thrive towards their goals.

How to stop complexity bias from protruding your life?

If complexity bias is a constant problem in your life, then don’t worry because you are not the only one here. In a famous survey, it was found that around 56% of the people tend to have complexity bias based on the behavior that they possess. They think that the complex problem will yield them more, and they tend to move towards the one which is harder to solve.

The same happens when you are a kid. If you think that severe problems should be solved first because they are more rewarding than others, then there is where you are wrong. The source of complexity bias is that it blinds our senses into thinking that everything in life, which is simple and healthy, can yield better choices and results too. We tend to feel the same because our brain is wired in that way.

Have you ever been in a situation where you have felt that the complicated situation is, and it will be easier for you to get out? What was your final solution? Did you get out eventually? Well, around 10 out of every 15 people who have the source of building complexity bias don’t actually get out of a problem. They tend to think that they will do, but then they get stuck.

Take this as an example. A Couple has borrowed money from one man, and they think that they can use the money and borrow another loan from someplace in a shorter time to pay to the man. This is when the couple starts to borrow loans from everyone, and instead of choosing to pay them off, they begin to fall into a loan loop. This is because the couple does have a source and tendency to show complexity bias.

It is better to get a bird’s eye view:

birds eye view

Have you ever thought of getting the bird’s eye view to solve your complexity bias issue? Well, if you have not, then it is your time. With the help of the bird’s eye view, you can see everything that you want. When you are doing something, then they are ‘bound to affect the people who are around you. If you are taking a loan, then your partner is bound to be affected by the same. It is essential that you get a 360 angle and view up from the sky.

As a source writer, I am often presented with a ton of complex ideas and contents to finish. But the ones which are simpler is easier to be done. When I do get the miscellaneous items, trust me, I think that they are useful because they are technical, and they can yield me more value than the others. But what I don’t asses and realize at the same time is, the complex my topics are, the harder it gets for me to understand and how to write on them. And the harder it gets for me to formulate a story in a simple language so that I can tell it to anyone or the readers who read it.

This is when I need to approach and look at the whole problem into the source of the bird-eye view and point here. With the use of the bird’s eye view, I can calculate the origin and function, which can be yield with the use of the simple articles which are collected at my place. It might be simple for me to write, but at the same time, they can yield me many more views too.

Here is how you can do the needful and get the thing I am talking about.

  1. When something is presented right in front of you, don’t procrastinate with it. You need to understand how and why you need to do it so that you can maintain the source of your work.
  2. Write it all down on a piece of paper if you want. If you want to have a good time and keep yourself away from your complexity bias, then writing down everything in a piece of paper will save you from the troubles later.
  3. And the third thing you need to do is rule out the negative that you have got. If you have negatives in your line of business, then you need to understand how you can work through it. You cannot rule out the images for you, but what you can do is, help yourself out from keeping them away from you.
  4. Get a perspective that can help you and the ones who are staying with you. You need to have a proper outlook over the items that are holding you down for the source of your complexity bias. This can only be done with the use of the full point of view that is being talked out.

Also read:

Ask yourself the right questions when you are divulging

Another type of source and problem that can be laid and help you out with your complexity bias is to ask yourself the right kind of the issues that you have. If you don’t ask and question yourself, then you are never going to get things moving in your life. You need to have a proactive session with yourself and understand that the rights and the wrongs depend on your view and the perspective. It is entirely on you.

Here are some questions you can divulge in.

  1. Ask yourself that if this is the right thing that you are doing or not?
  2. Make sure that you keep your time out on the following and understand the source of complexity bias in your life. You need to dive in deep, and this way, you can find a cause or a means through which to get out of your complexity bias-based behavior.
  3. Ask yourself that the complex problems that you intend in your life will yield you something or not?
  4. Ask yourself the general questions like the assessment of the work and how it can be managed for you? You need to look out for you, and this can only be done with the source of you questioning all the details and the intricate source of your life.
  5. Ask yourself that these complex problems that you are undertaking for yourself won’t cause you damage or not?

You need to think before you act, and this is the prime solution for getting over your complexity bias. It can help you to manage the best, and in the right way, these top questions will help you to get over the type of behavior which you generally possess.

Conclusion

Always have an excellent tactic when you are asking yourself some questions. Always remember that people, when they have complexity bias, they tend to over-complicate even the simplest of things. It is better that you ask for a piece of needed advice from your peers if they are sorted out. Or, if you want, then you can look for professional help if the simple things are not yielding much into your life. The more you indulge in these, the more the behavior will grow on you and which can later yield to something complicated to eradicate.

November 20, 2019 Investing Psychology, Personal Finance No comments yet
What is Recency Bias? And How to overcome it? cover

What is Recency Bias? And How to overcome it?

Recency bias is a psychological phenomenon where a person can remember something which has happened to them recently compared to the thing that has happened to them a while back.

For example, to conduct a test to check this phenomenon, a person is asked to recall the name of the thirty people that they have met. Well, out of the thirty people, the person will easily tend to remember the names of the people that they have met recently compared to the ones that they have reached a long time back.

Recency bias is the main type of cognitive error that happens to the human brain. It is one of the errors which plagues a lot of traders and investors. It tends the human mind to remember the recent data that are happening in their lives and forget the ones that have happened a long while. With the help of this article, you will understand what causes this problem and how well you can overcome the problem of recency bias in your life if it is affecting you on the financial scale as well.

Why it is your enemy as an investor?

Recency bias is the description which tends to extrapolate the recent experiences that will happen to you in the future. When it comes to investing, recency bias is one of the biggest disasters that they can face. Because when investors try to invest, the recency bias skews the entire reality in front of them, and this is how their views can change from choosing something to selecting another thing.

For example, let’s say that an investor has been making a good average annual return in the last 5 years. However, in the last twelve months, his portfolio is not giving good returns. Here, because of recency bias, he might feel negative and may believe that the market and his strategies are not working in his favor anymore. However, this is not the complete reality.

Recency Bias example trade brains

Similarly, for a trader, let say that out of seven days, he made losses in the first four. Nonetheless, in the last three days, he made consecutive wins. Here, he may feel positive as he might be carrying more weight to his recent trades over the past ones because of the recency bias.

Moreover, many times, investors may tend to stay away from shares thinking that the stock market will fall because it has been falling recently. That is not the case which happens every time as the share market is not always the same. You can never put your trust in it based on recent behaviors.

How to overcome the recency bias?

If the recency bias is becoming a day to day problem then there are proven ways to overcome it. Here are some of them presented below.

— Don’t ever have a myopic view.

Get a grasp on the long term source and try to invest in the market that way. A myopic view means that you are constricting yourself to the four walls of the market, and you don’t want to try something new. You might fall when you are trying to invest somewhere, and there are gut-wrenching actions that might happen as well. But since recency bias helps you to build your views based on the latest outcomes, try to overcome it by thinking about the bigger picture in your life. Just try to expand your opinions as much as you can.

— Always try to work in with what you have in control.

Control all the asset allocation that you have. Try to stay away from the bad investments in your life. Setting realistic expectations is something that can put you down and bring false hopes in your life. Always try to remember the fact that recency bias feeds on the belief that you have in your life. Try to minimize the risks that you have built on your front. Use the thesis and help of the finance operators for your investment business if you have one. They will try to cut them down for you.

— Don’t ever try to get swayed with the latest performance.

As a smart investor, you should not ever try to get swayed with the latest performance or the numbers that are popping up in your life. You always have to understand that something in your life is just a temporary digit. Just like the numbers that you are making in the market to the points that you have scored, not always they will stay the same. So raising your expectation based on the higher numbers is a silly movie, and here is where recency bias plays a part in your life.

Also read: 5 Psychology Traps that Investors Need to Avoid

Recency bias is a brain illusion

Always try to understand that cyclicality comes with a lot of terrains. There is not a smooth road that you can take to success. If you are trying to get the best thing in your life then there are a lot of ups and downs that you have to face. But you should never determine the outcome or the results based on recency bias.

Recency bias is a brain illusion that happens when you see the latest issues. It is your very brain tricking you into thinking that the same will happen for a couple of other days, as well. Find appropriate assistance if you are finding it hard to let go. There is always assistance if you are trying to look for one.

October 28, 2019 Investing Psychology No comments yet
How Do Credit Card Companies Make Money

How Do Credit Card Companies Make Money?

There is a reason why credit card companies are always looking for their next best client. When people start using their service more, they can make more money based on the usage that is served to you from their side. There are around issuers who advance over millions of purchases made by their customers. And the return can come in billions to the credit card companies.

Credit card companies in India

Recently for the new age foray of digital India, the bank is always looking and scoping out credit cards for their users for the best of interest for their end. When it comes to India, there are mostly banks that issue the credit card to the people. So when it comes to publishing your new credit card, then the bank will be making money. From the bird’s eye point of view, it is like a charitable business here.

This means that when you are asking for a credit card, then the bank will issue the same for you. These credit cards are released from the source of the third parties which are offered to these banks. When it comes to issuing credit cards for the customers, then the bank issues it for the people and provides a credit for it. Then after the same, the customer has to pay the bill for the usage of the card.

Now, when it comes to making money, then the only major fees that the bank gets are by the interest, which is levied on the outstanding amount which is ready to repay. In case of delay of payment through your credit card, the bank will charge a collected rate of interest onto the same.

Anyways, there are also other sources through which the banks and credit card companies make money with the usage of these credit cards that are issued to your name. This will be later discussed with the help of this article.

How Do Credit Card Companies Make Money?

Here are how the credit card companies make more money and earn profit as well with the use of their business.

Networking

When it comes to the age of the digital period, then do you know who makes money these days? Anyone who can help your brand or company extend its reach. In this digital world, it becomes difficult for the common man to continue the source of his business, and this is why brand or marketing tie-ups are essential. For example, a lot of brands are spending more on their digital marketing because they need a better reach of the audience from all around. It can help them to gather the clients for their said work.

The credit card companies have direct access to the whole of the customer base, and it can influence the spending as well. Therefore what these credit card companies do is that they help for both types of brand promotion and the generation of sales. To reach new customers, it is a useful tool here. Plus, they get paid for the brand promotion that they are making from here.

Example:

For example, let’s take a look at the leading banks here.

As per the RBI data here, HDFC banks have issued around 12 million credit cards, followed by the SBI bank, which has issued around 8.7 million cards. Then comes the banks like ICICI Bank, the Axis Bank, etc. So when it comes to coming or gathering customers from all around, then HDFC Bank, SBI and ICICI bank has direct control over the same and over a crore of customers who have issued their credit cards.

So if the banks are paying around lakhs for winning over the customers with the help of their brand promotion, then they are getting the doubles in return through here. Brands are always ended up in marketing tie-ups with the credit card companies so that they can get cash backs on their set. On the other hand, there are two types of tie-ups that can be tried here. One is the low value, and the other ones are the high value. Plus, there are interest charges levied onto the same too.

Interest gathered onto the balance which is outstanding

It is a universal fact that credit card companies can make money based on the benefits which are charged on your balance amount. Among all form of credit facilities, the interest rate which is loaded onto your card is the highest, and they are even higher than the private lending that you have.

This means that when we are talking about the higher amounts, then we are speaking as high as 40-42% interest, which is charged annually and which is about 3-3.5 %, which is billed monthly here.

Credit Card Interest Rates in India Bankbazaar

(Image Credits: PaisaBazaar)

According to the facts and the stats which are provided by the credit card companies, around 60% of the people or the credit card holders do not pay their levied amount right on time, and this is when the interests on their credit can be charged to them. These customers are the primary source of income for these credit card companies out there.

The amount which is not paid by the customers is always termed to the absolute figure. This means that when we are talking about 60%, this does not mean that 60 people out of every 100 are not able to pay their amount. This means that some even have a higher outstanding than the other, and; this is where their interest is levied.

Also read: 10 Best Credit Cards in India [With Exceptional Benefits]

Cash advance charges also generate payment

Here is another way through which the credit card companies can charge in the amount and get the income for their source. Usually, the cash limit for the credit facility is around 20-40%. This cash limit comes handy in case of the emergency which can be met during the time of shortage of cash, etc.

So if you take an advance payment from the bank, then the bank will charge an interest rate of about the same from you on the amount that they are granting you. This is one of the costliest ways and one of the most prime ways through which credit card companies can make cash.

Merchant Fees

Another way from where a credit card makes money is merchant fees. Whenever the credit card user makes any payment using their credit card, the entire amount does not go to the retailer. The credit card companies charge a small fee as the percentage of the purchase amount for providing safe and secure payment transactions.

This charge is known as a merchant fee or swipe fee. This merchant fee can be anywhere between 1.5-2% of the transaction value and hence serves as a huge revenue source for the banks.

Although, the credit card user doesn’t have to pay any additional fee, however, the credit card companies take a portion of the profit from the merchants. Therefore, the merchant fee only affects the merchants. Anyways, some merchants may use a ‘credit card surcharge‘ in addition to the cost of products/services that they are selling in order to off-set the merchant fee.  This surcharge is waived if the customer prefers cash or debit card payment as the fees on the debit card is comparatively lower for merchants.

Annual and renewal fees

Now comes to the other charges which come with your credit card. When you are issuing credit cards from the bank, then there is an annual fee that you have to pay. And also, for the renewal fee, which means that you have renewed your credit card after it has been extended to a valid period.

These charges may be waived off by the banks if you’re an active spender and cross their pre-specified annual expenditure through credit cards. Anyway, these charges are usually given out through the customer whose value of spending is meager.

In other words, credit card companies will charge you a fee which you eventually have to pay on the annual or during the time of the renewal as well.

Also read: The Pros and Cons of Credit Cards in India

Closing Thoughts

As discussed in this article, you have found out that the credit card companies do have a lot of sources for their salary here. The credit card companies make money by charging interests on the customer’s delayed payment, merchant fees, networking and marketing with branks, annual and renewal fees, etc.

So if you don’t want to levy the heavy-duty and the charges for your late payment, make sure of the financial tracking that is happening with the help of your card. Take notes and understand your credit billing cycle as well so that you can figure out when to pay your fees and to keep the minimum as well.

October 12, 2019 Credit Cards No comments yet
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Maslow’s Hierarchy of Needs – Debunking the Whole Theory

So let us begin from the start about what is the theory behind the Maslow’s Hierarchy of Needs. As we all know, Human behavior is complex. And, to understand the basic of it, you need to dive into the deep level of science. Well, human behavior is the combination of both science and art, so here is an essential prime factor and explanation of it.

In the layman or the economic term, human behavior is based on wants that we generate towards the same kind or towards materialistic items. For example, if someone sees a dress at a store and it is pretty then their instant thought is to buy that dress. This type of human behavior is categorized into a section of wants.  

Maslow said and proved that human behavior is a series of complex happenings in the mind of an ordinary human being due to motivation. The main factor or the module of this explanation lies in the motivational factor, which rules human behavior.

A close look at Maslow’s Hierarchy of Needs

Maslow first introduced his needs theory in the year of 1943. This was published in a journal back then because people then never had smartphones or tablets. The weekly or the writing was published under the name of ‘Human Motivation and its Theory,’ and he even wrote a book about the same. This Maslow’s Hierarchy of Needs suggests that there are specific needs that arise in humans, and they can be categorized in the form of a pyramid.

The topmost of the pyramid is the one that comes at a high level. And the last part is the one which humans need the most or which cannot be delayed. While some of the people criticized his working theory on the needs of the human mind, he suggested that the cycle of life happens with the hierarchy which he has produced in his book.

Maslow did tell that he was always interested to know what made people feel happy, secured, anger, and this, in turn, raises the level of needs inside their mind. With all due respect, we know that the human brain is complicated and debunking it can be hard work but if we categorize ours wants to different sections that we have then it is going to be easy work for us.

As a humanist Maslow believed the same. He wanted to know what the self-desire that people wanted or which could also be counted as the self-actualization needs, which comes at the very top.

There are five different levels of the Maslow’s Hierarchy of Needs. The first starts with the self-actualization needs then it shifts down to the esteem needs. Then it goes down again to the belonging needs, then to the safety needs and later to the psychological one.

From the basic level to the complex one

Maslow's Hierarchy of Needs - Debunking the Whole Theory

When you understand Maslow’s Hierarchy of Needs, you have to realize that there are two types of needs that a human can have.

One is the basic needs like the need for safety and shelter. Or to have food when they wake up in the morning. And the next one is the complex where a human needs to understand his self-esteem. The self-actualization means that a human has to follow his full capacity so that they can only reach the top of their life. So it is sorted.

When it comes to the wanting of needs, then humans go for the basic at first and then they choose to select onto the complex at later.  

The pyramid, which is present for Maslow’s Hierarchy of Needs refers to the needs and what they relate to the mind of a human being. When a person progresses and has the safety or the necessities that they want, they move to the need of being loved. This comes in the middle where they rise, and this is where their self-esteem needs grow. This is when someone tries to question their behavior and attitude toward something. The topmost level of the pyramid consists of the actualization needs or the standard. This is where a human needs to understand his boundary and his limits to what he/she can achieve in their lifetime.

Breaking down the Pyramid

Here is how the requirements are broken down, which are present at the pyramid.

1. Psychological needs

These are the most common or the primary type of requirements that a man/woman can have. These are also known as the apparent needs which you have to get in your life to survive. Some of these needs include having the food to eat, a shelter, or a place to stay, the need to breathe and live. In the essential requirement of these needs, there are nutrition and air which are added here as well.

Maslow also included that the need for sexual reproduction comes to this point. This is because, for our population to grow and move forward, people need to mate with each other. And this is one of the most common or basic needs that they can have.

Also Read : The Butterfly Effect: This Theory Can Change Your Life

2. Safety needs

Coming to the next or the upper level of the pyramid, there lie the safety needs. This means that a human being in order to live should have a minimum safety in their lives. At this level, their need for security and safety becomes quite apparent. People who want to have control over their lives and the things that they are getting needs to have the safety needs issued here.

Some of the necessary safety needs are financial safety, health, and wellness safety and the security needs that they want from injuries and accidents. People need to obtain an excellent job so that they can be financially dependent and stand on their own feet. And they should have a basic safety on how they are living which matters to their well-being as well.

3. Social needs

The third one is called social needs. This means that in order for the average or an ordinary human being to live in society, they need to have a basic social need. These are the things that can satisfy the human mind. This need in Maslow’s Hierarchy of Needs helps a human to understand the meaning of being loved, respected, and accepted socially into a group.

Here are some of the breakdown of the needs. The need of being loved, the lack of having romantic attachments, having a healthy family, a group of friends, being accepted to community groups are everything that lies here in this need. To fight mental disorder such as depression or loneliness, social needs are the part which helps a human being. This is to feel being loved by their opposite sex or by their family members.

4. Self-esteem needs

At the fourth level, which comes for the Maslow’s Hierarchy of Needs, it is the self-esteem needs that are talked here. So what are they? Well, self-esteem is something which is a part of your day to day life. It is the need for being appreciated and have respect for the work that you do. When the requirements which are left at the bottom of the levels are satisfied. This is one need that appears inside your mind.

We, as an ordinary human being, need to be recognized by the others. We have a compelling need where our self-esteem and ego comes, and we identify them. Even though they are not the basic needs, they go and lies in the complicated part here. At this point, after you have complied with the basic needs. And, it becomes increasingly crucial for you to gain respect for the work that you do for others and even for yourself. This is an appreciation or needs that you want from others.

5. Self-actualization needs

The top of the pyramid lies for the self-actualization needs or the need to actualize your wants. At the peak, it lies, and it explains the conditioning of the human brain to attain the kind of desire that they have towards a sure thing.

For example, self-actualization needs mean that you realize what you are capable of. Maslow explained that this need means ‘it is loosely based and describes the full use of the human mind in regards to the talents, potentialities that it might have, etc.

Also Read : 5 Psychology Traps that Investors Need to Avoid

Summary

For the summarization of the entire Maslow’s Hierarchy of Needs, here is the essential thing.

  1. The human mind is the complex structure of our life. 
  2. There are two kind of needs which can happen inside our mind called the basic and the complex requirements.
  3. There are five needs that can occur inside us. 
  4. The first is the psychological need or the basic level of need used by people. 
  5. The second lies in safety needs like safety for financial issues and other guarantees. 
  6. The third is the psychological need which uses a human to function on the basis of emotions. 
  7. Esteem needs stand at fourth and that’s where the respect is marked.
  8. The fifth one is called the actualization need or when a person understands his/her entire potential.

The Maslow’s Hierarchy of Needs is a diagrammatic module of how our needs are categorized and based. The higher you move, the complex your need becomes. And mostly Maslow has said that the requirements are based on the income level of the people too. People who have reduced income are more opinionated towards the primary type of the lower level of the pyramid.

And those for the higher section of the society have an opinion for the higher base for the pyramid. There are potent motivators from all around which works for the people to enhance their needs as well.

October 11, 2019 Investing Psychology 1 comment
10 Best Credit Cards in India With Exceptional Benefits cover tradebrains

10 Best Credit Cards in India [With Exceptional Benefits]

10 Best Credit Cards in India in 2019 with exceptional benefits (Updated: October 2019)

Credit cards are everywhere. These days, they are used in almost all underlying operations like purchasing items from the store or even for your online sale as well. A credit card helps to shape you a good lifestyle, and since there is a fixed amount for which you have to take in the credit for, you can even stop yourself from the overspending habits that you have. They are the growing aspects of the economic market, and as we are towards the source of digital transactions, credit cards are becoming more and more efficient these days.

Moreover, Credit cards are instantly safe for you to use for any source of electronic payments since they are backed up by full security. As a matter of fact, credit cards are comparatively safer than debit cards.

However, since each and every bank is offering new credit cards with amazing rewards, which one to choose? In this article, we are going to discuss the ten best credit cards in India so that you can choose the one that suits you the best.

Why Credit Cards?

Credit cards are very similar to a debit card issued by a bank or a financial institution. However, credit cards let the cardholder borrow money from the financial institution to pay for goods and services. It imposes the condition that the cardholder must pay back the borrowed money after a certain period of time along with some interest as well as any additional charges if agreed.

The company issuing the credit card may also put up a line of credit (LOC) to enable the cardholders to withdraw money in the form of cash. The institution customarily presets the borrowing limits of the customer based on his individual rating. The borrowing limit can be set monthly, quarterly or annually, according to the profile and needs of the customer.

This mode of payment is one of today’s popular payment method for buying goods and services because of the following reasons:

  1. Purchasing Power: Credit Cards empower the holder to purchase locally as well as overseas also. They also let you purchase through phone, online and at stores, of course. Most of the credit cards, especially MasterCard and Visa, are accepted virtually anywhere.
  2. Shop now, pay later: Credit Cards make it very easy to buy on credit. For example, if you’re spending money on regular monthly expenses, it’s usually not a good idea to use your bank balance. Instead, you can buy through credit card and return the money to the bank by the end of the month. This way you have used the leverage instead of using your own money. Besides, credit cards are the best tool to help us track our expenses and hence it can help you in budgeting.
  3. Rewards: Mostly, all the banks and financial institutions who give credit cards offer various rewards and cashback on our day-to-day purchases. For example, if we book a movie ticket, there are numerous offers available from different companies. Some also offer benefits like ‘Buy 1 Get 1 ticket’, which results in the benefit of the customer only.

In addition, Credit cards can also act as emergency protection. In case of a medical emergency or unexpected event, one should maintain an emergency fund which must be equal to his/her six to twelve months of salary to keep him/her. A credit card can help you to fight with the unforeseen expenses.

Also read:The Pros and Cons of Credit Cards in India

10 Best Credit cards in India to choose:

Finding a sound credit card in India can be a tough job for you because you have to go through a lot of things. First of all, you have to take care of the facilities that you are getting from your card and even the bank through which it is being provided to you. Some of the credit cards are immensely useful for your shopping habits, and they come with excellent features, as well.

So here are ten of the best credit cards in India, which you need to check out right now.

1. American Express Membership Reward Credit Card

American express membership rewards card

Coming to the list of the top used credit cards in the Indian market, the MRCC is the top-rated one. It helps you to get reward points on your spending so that you can redeem it on your next purchase or issue. The annual fee for this card is Rs 1,000 plus GST. The renewal fee for this card is Rs 4,500 plus GST.

Current Offer (Till 31st December 2019)

  1. First-year fee: 0
  2. 2nd year Fee:1,500 INR* + applicable taxes

Eligibility Conditions:

  1. The applicant should be over 18 years of age.
  2. The applicant’s annual income should be of Rs. 6 Lakhs and above (in the case of Self Employed or Salaried).
  3. Good credit history and no payment defaults.

Benefits:

  1. You can get 4,000 points as a bonus on the first membership for this card.
  2. Earn up to 1,000 points as the membership reward points every month with this card.
  3. On payment of the annual fees by this card, you can get around 5000 bonus points.
  4. Redeem your reward, and you can get 18 karats and 24 karat gold collection from the program of the annex.
  5. Other benefits like zero lost card liability and others come as well.
  6. The Annual Membership Renewal fee of Rs.4500 will be 100% waived off if the total spends on American Express Credit Card in the immediately preceding membership year is Rs.1,50,000 and above.

Here’s a quick link to apply for the American Express Membership Credit Card!

2. Citi Premier Miles Credit Card

Citi Premier Miles Credit Card

If you want to save some money with the help of your credit card system in exchange for the other facilities like flights, international hotel/airline loyalty programs, then this is the one for you. The annual fees for this card are 3000, and the renewal fees are also the same.

  1. A welcome reward of 10,000 PremierMiles on the first transaction of at least Rs 1,000 with first 60 days.
  2. Spend around 1000 with this card, and you will get 60 days of insurance and 10000 bonus miles.
  3. Get an additional 3000 miles on your card anniversary every year.
  4. Earn up to 4 miles for every Rs 100 that you spend.
  5. Earn 10 miles for every Rs 100 on the transaction that you do with the airline world.

You can redeem your miles for flight tickets across 100s of airlines or attractive vouchers and merchandise from premium luxury and electronic brands on Citibank online catalog.

You can read more about the benefits and apply for the Citi Premier Miles Credit Card here.

3. HSBC Visa Platinum Credit Card

HSBC Platinum Credit Card

HSBC is a trusted source for online credit cards that has served over a million people from all around the world offering amazing discounts on movies, flights, restaurants and more. There is a zero annual fee for this credit card, which you can have for yourself. The renewal fee is also nil for this card.

Eligibility Conditions:

  1. The applicant should be aged between 18 to 65.
  2. The applicant’s annual income should be Rs. 4 Lakhs and above (in the case of Self Employed or Salaried).
  3. Current City of residence should be Bangalore, Chennai, Gurgaon, Hyderabad, Mumbai, New Delhi, Noida, or Pune
  4. Good credit history and no payment defaults.

Benefits:

  1. Nil joining and annual fees.
  2. On making the first transaction with this card, you will get a Rs 2,000 voucher from the clear trip and Rs 250 Swiggy voucher.
  3. Within 90 days of the card issuance, you will get 10% cashback up to Rs 2,000.
  4. Earn 3x reward points on the hotel telecom and another service that you want to use before the expiry.
  5. Get five times accelerated points towards the rewards if you make a purchase, and the total spending limit is above Rs four lakhs in an anniversary year.
  6. Get a movie ticket voucher worth Rs 500 on spending over Rs 50,000 in a calendar month.
  7. Air Miles Conversion on JetPrivilege and Singapore Airlines for booking flight tickets.

You can read more about the benefits and apply for the HSBC Visa Platinum Credit Card here.

4. Standard Chartered Manhattan Credit Card

Standard Chartered Manhattan Credit Card

The name might sound fancy to you, but this credit card comes with a lot of facilities for you to use anytime that you want. The joining fees for this card are Rs 999, which is the same as the renewal fees, as well.

Eligibility Conditions:

  1. The applicant’s age should be between 21 and 65.
  2. The applicant should have a stable monthly income.
  3. The applicant should belong to credit cards sourcing cities/locations of the Bank.

Benefits:

  1. When you make your first transaction with this card, you will get a voucher for 2000 from a book my show.
  2. Get 3x reward points for all the expenses that you have per Rs 150 spent.
  3. Get 5% cashback when you use this credit card at the supermarket. Enjoy multiple offers for this card that you want, like discounts on the traveling, dining, and other categories.
  4. Under the excellent life program, you can avail of offers as a discount on several purchases on Spicejet, Goibibo, Croma and other partners.
  5. The renewal fee of Rs 999 is waived on spending Rs 1,20,000 or more in the Year.

Here’s a quick link to apply for the Standard Chartered Manhattan Credit Card!

5. HDFC Regalia First Credit Card

HDFC Regalia First Credit Card

For all the HDFC bank users from all around, this credit card is handy and comes with multi-features for you. The annual and renewal fees for this card is Rs 999.

Eligibility Conditions:

  1. For Salaried: Age: Min 21 yrs & Max 60 Yrs, Income: Gross Monthly Income> Rs 40,000
  2. For Self-employed: Age: Min 21 yrs & Max 65 Yrs, Income: ITR > Rs 5 Lakhs per annum

Benefits:

  1. You can get complimentary priority pass membership on all the airport lounges.
  2. Earn up to 4 Rewards points on every 150 rs that you spend on your card.
  3. 1% fuel surcharge waived off on fuel transactions.
  4. On selected restaurants, you can get around a discount of about 40%.
  5. Users will get 7,500 bonus points every year on spends of Rs.6 Lac or more in each anniversary year.
  6. Convert your reward points, and then you can use it for the coverage of the air miles on your card.

You can read more about the benefits and apply for the HDFC Regalia First Credit Card here.

6. ICICI Bank Platinum Credit Card

ICICI Bank Platinum Credit Card

This ICICI bank platinum chip credit card is the one for you to use anytime you need it for. There are so many added discounts and offers you can get from here. There joining fee is Rs 199 and the annual renewal fee is Rs 99, which can be waived if you spend ₹ 50,000 or more annually on your Card.

Eligibility Conditions:

  1. The applicant’s age should 23 or above years of age.
  2. The applicant should have a stable monthly income.

Benefits:

  1. Make contactless payments by just waving at the card in front of the NFC terminal.
  2. Earn up to 1 Payback for every point on the purchase of 100 rupees that you make.
  3. Get two paybacks for every 100 rs that you spend on fuel.
  4. You can even avail of the 1% fuel surcharge waiver at the HPCL pumps.
  5. There are selected restaurants where you can opt for a 15% discount on your card.
  6. Redeem the reward points, and you can get the gift vouchers as you want.
  7. Lenskart – existing offer of Rs 500 off on purchase of Rs 3000 or more valid till December 31, 2019

Here’s a quick link to apply for the ICICI Bank Platinum Credit Card!

7. SimplyClick SBI Credit Card

SimplyClick SBI Credit Card

When it comes to the banking institution, then SBI is one of the chosen ones from the whole lot. The annual fees for this card are around 499 and the renewal fees are the same as well.

  1. Get Amazon.in gift card worth Rs.500 on joining as your reward gift.
  2. You can earn one reward for every 100 that you spent on it.
  3. Cardholders can earn e-voucher worth Rs.2,000 on annual online spends of Rs.1 Lakh
  4. Get 5x rewards on all the online spends.
  5. Get 10x reward for the online spend, which is partnered by SBI – – Amazon / BookMyShow / Cleartrip / Lenskart / Netmeds / Rentomojo / UrbanClap
  6. 1% fuel surcharge waiver for each transaction between Rs 500 & Rs 3000
  7. Spend 1 lakh in a year, and you can get your annual fee of Rs 499 reversed.

You can read more about the benefits and apply for the SimplyClick SBI Credit Card here.

8. American Express Platinum Travelcard

American Express Platinum Travelcard

If you are a travel enthusiast, with the help of this card, you can do a lot of things for yourself. For example, you can get through the make my trip offers and much more. The annual fees of this card are Rs 3,500, and the renewal fees are Rs 5,000, second year onwards.

Eligibility Conditions:

  1. The applicant should be over 18 years of age.
  2. The applicant’s annual income should be of Rs. 6 Lakhs and above (in the case of Self Employed or Salaried).
  3. Good credit history and no payment defaults.

Benefits:

  1. Get a welcome gift of about 5000 bonus from the use of the first transaction that you make with this card.
  2. Earn 1 membership reward point for the Rs 50 that you have made for the utility, bill payments, etc.
  3. On spending about Rs 1.9 lakhs with the use of this card, you will get a travel voucher worth Rs 7700.
  4. Further, on spending about Rs 4 lakhs with the use of this card, you will get an additional travel voucher worth Rs 11,800.
  5. Cardholders can also enjoy 4 complimentary visits per year to airport lounges across India.
  6. There are exclusive offers to making my trip here like the Taj Experiences E-Gift Card worth Rs. 10,000 from the Taj Hotels Palaces Resorts Safaris.

Here’s a quick link to apply for the American Express Platinum Travelcard!

9. Indian Oil Citi Bank Credit Card

Indian Oil Citi Bank Credit Card

If you are concerned with the rising price of the oil and fuel, then you need to go for this card. The annual fees and the renewal fees are Rs 1,000 for this card. This annual fee on the card is waived when you spend Rs.30,000 or more on your Card in a membership year.

  1. Get up to 71 lit of free fuel every year in the form of the fuel surge.
  2. Full waiver of the fuel surcharge (1%) on fuel purchases
  3. Earn four turbo points on every Rs 150 spent with your card (1 Turbo Point equals Rs.1 worth of fuel).
  4. Get two turbo points on every Rs 150 spent on your card on the grocery, and other supermarket pays too.
  5. The accumulated turbo points that you have will never expire.
  6. Cardholders will also get up to 15% savings across participating restaurants with your Citi credit card.

You can read more about the benefits and apply for the Indian Oil Citi Bank Credit Card here.

10. SBI Elite Credit Card

SBI Card Elite

This credit card is specially meant for those who believe in spending and saving at the same time. The annual and renewal fees of this card are Rs 4,900.

  1. Get a welcome e-voucher of about 5000 for an array of brands like Yatra, Batra, Hush Puppies, Pantaloons, Shoppers Stop.
  2. Get free movie tickets worth Rs 6000 in a year.
  3. On spending four lakhs in a year, you will get a bonus reward point of 10,000.
  4. Earn 5X Reward Points on Dining, Departmental Stores, and Grocery Spends
  5. Get 2 Reward Points per Rs. 100 on all other spends, except fuel
  6. Enjoy 2 complimentary Domestic Airport Lounge visits every quarter in India
  7. 6 complimentary Airport Lounge visits per year, outside India
  8. SBI Card ELITE also offers the privilege of the lowest Foreign Currency Mark-up Charge of 1.99% on International usage.
  9. Accelerate your reward earning when you get it with the use of the card on the grocery shopping and the other items.

You can read more about the benefits and apply for the SBI Elite Credit Card here.

Closing Thoughts:

These are the best credit cards in India that you can pick. If you do not have a credit card yet and you’re applying for the first time, Standard Chartered Manhattan Credit Card or ICICI Bank Platinum Credit Card can be a good choice for you.

Anyways, you do not need to have just one credit card. You can apply for multiple cards if you have got a strategy to get the maximum value out of them. Choose your credit cards accordingly and find out the ones which fit you the most, depending on your lifestyle and preference.

October 7, 2019 Credit Cards 2 comments
Why Credit Cards Are Safer Than Debit Cards cover

Why Credit Cards Are Safer Than Debit Cards?

When debating on the topic of why credit cards are safer than debit cards, you have to understand the logic behind both of them. There are often that you may ask yourself what type of card can be readily used for a safer purchase, and this is when you need to understand their benefits and the uses of both the cards. Some people end up confusing themselves since they cannot get to the point of which one to use for their day to day transactions.

First of all, Credit and debit cards are not the same cards that you can use

Each is a plastic rectangle-shaped card which helps you to pay for the service or the product that you have bought for yourself. In the modern age of digitalization, around every place have a credit or a debit card facility option here for you. Typically they both look the same, so some people undertake for the self-belief that both cards have the same purpose, and they are used for mere transactions.

Well, here so where they can go wrong. Credit cards are sometimes used, which can be heightened for the consumer to stay protected from the frauds. But there are some of the personal safety advantages that you can get from the usage of the debit cards as well. So with the help of this article, you will know which card you can use for a safer online or offline transactions.

The primary difference between credit and debit cards:

Although both of them will look alike in front of you, the credit and the debit cards have different purposes to them. You cannot undertake the function of both the cards based on their appearance. So here is the following thing which you have to understand.

Credit cards are equipped with a credit line:

This basically means that there is a fixed amount of money which you can try it borrow from the lender. After every charge that you make, the issuer pays the merchant the expected amount, and the amount that you can hire to your name is reduced from the all total sum.

So if you have a credit line of around 20,000 and you have got about 5,000, you will have 15,000 left to borrow from your issuer. The more you use your card, the less amount you will be left with from your issuer.

After the payment due period, there is an interest that is charged onto the 5,000 that you have applied for yourself. So unless you have paid in for the 5,000, the interest fee for the grace period will be charged on that basis. If you pay less for this month, then the amount will be rolled to the consecutive month. And if you have paid it al-together, then your amount will be charged back to 20,000. This is how a regular credit card works.

Also read: 10 Best Credit Cards in India [With Exploding Benefits]

For the debit card, there is no borrowing involved here:

This means that you don’t have to borrow any sum of money from your issuer to get to a transaction. So when you are using a debit card, you will be tapping into the fund of cash that you have in your bank.

After you have made the purchase there, the money which is deducted will be transferred from your account to the bank account of the merchant. This way, the amount will be paid to the merchant, and it will be deducted from your source.

Now there are a lot of banks out there who will charge you a negligible amount of interest on the purchase that you make. So with the help of your debit card, you will know how much amount is really in your bank. You can even add to it by checking it anytime that you want.

Why Credit Cards Are Safer Than Debit Cards?

Safety against frauds for Debit and Credit Cards

fraud transactions Why Credit Cards Are Safer Than Debit Cards

In India, both credit and debit cards are subjectively safes to use as there is an additional factor of authentication required to validate any transaction. For making transactions, you receive OTP on your registered phone number to confirm the transaction. Therefore, until and unless your cards and phone number are both hacked/stolen together, it is very difficult to make fraud online transactions.

However, withdrawing money from your debit card or credit card from an ATM doesn’t require OTP validation. And here, if your debit card is stolen along with your PIN, the fraudsters can withdraw a huge amount if you have got a lot of money in your bank account. This may generally happen if you are not aware of the transactions i.e. when your active phone number is different than the registered number. Here, you do not receive the transaction alerts from the bank via messages. Similar is the case when you do not care to read the transaction messages sent from your bank and hence do not block your card immediately in case of fraud or stolen.

On the other hand, if we look into the credit cards, there’s a limit on the withdrawal and it doesn’t depend on how much money you have got in your bank account. The fraudsters cannot withdraw cash more than this predefined limit.

Further, a major drawback in the case of fraud on a debit card is that you lose the amount from your bank account. Even if you raise a complaint to the bank, it may take months for the bank to refund that amount. This is because they need to verify and confirm the fraud activity. They may ask you if you’ve shared the Pin/OTP with any of your friends/colleagues etc. In the case of ATM transactions, getting the CCTV footage and verifying that the person wasn’t you is definitely not a fast process. And throughout this verification process, all you can do is to wait patiently to get back your money.

On the other hand, when the same happens against a credit card, you can raise a complaint and get appropriate reversals before the next credit card billing cycle. Moreover, as this money never belonged to you, it won’t hurt you economically and even if the investigation process goes for weeks, you can remain calm. Overall, in terms of fraud protection, we may conclude than credit cards are safer than debit cards.

Also read: 5 Things You Should Know Before Getting Your First Credit Card.

Credit And Debit Card Usage:

When you are using debit cards, you might check to see that they are not user or consumer-friendly over here, but you can use them for compelling other reasons which are presented.

First of all, if you don’t have an overwhelming debt to your name, then debit cards are the ones for you. By focussing on the expenses that you make for yourself with the use of your debit card, you can solve the financial crisis that you face. Debit cards let you use the amount that you have inside your bank and not more than that. If you apply for the amount which is over in limit, then it will be declined from the source.

Credit cards usage

Coming to the usage of the credit cards, they have a user-friendly base, and you can use them anytime by ensuring the right and even your safety as well. There are some clear, substantial advantages of using them. For example, if you want to go out for shopping then take your credit card with you. It is a preferred instrument since it helps you to have your way.

Plus, the internet trolls who are sitting every right now and then won’t be able to hack into your account and see how much amount you have left. Besides, when you are going in out for traveling, then credit cards are the key or the prime thing to use. They can be used for checking accounts, and you can always fall short of cash when you are outside. So credit cards are there to save you from the hustle or the worry that you might face by yourself.

Note: If you are yet to get a credit card, here is a quick link to check your eligibility and apply for credit cards online.

Final verdict

Well, we all know that you can use both these cards for your transaction habits. Like credit cards, it helps you to run the funds when you are in need of an emergency. Debit cards are used for you to save the fund in your bank and then use it carefully by understanding your expenditure limit. Certain people can get into a credit card debt if they have not paid out their expenses or the issues that they have made from their lender. In other words, if you want to never fall into a huge trap of expenses and debts surrounding you from all around, then debit cards are a go-to option for you.

Regarding consumer protection, definitely credit cards are safer than debit cards. From fraud transactions to creeps looking into your bank account, all can be lessened by using credit cards. Moreover, there are some of the awesome advantages that you can even get for yourself by the usage of these cards like cashback and rewards.

Final advise, having both at your disposal is an excellent technique, as well. This way, you can use the cards accordingly to the given scenario that you please to have.

October 6, 2019 Credit Cards No comments yet
buying a car vs Ola or Uber ride

Buying a car vs Ola or Uber ride – Which is cheaper?

When you ask anyone – ‘Which is cheaper? Buying a car vs Ola or Uber ride?’, most of the people will have a different opinion. In this article, we have shared our thoughts.

At a press conference which happened in the last Tuesday, Finance Minister Nirmala Sitharam said that the millennial prefer to go through Uber and Ola rather than buying their Car. This is because the option is much cheaper and affordable for the current generation. 

According to the finance minister, it was said that the youth today would rather spend a load of cash on booking an Uber or an Ola other than paying long term EMIs for buying their vehicle. And this statement has created an uproar among the working individuals and even the mentioned names of the automobile/transporting service system since they reportedly said that they have nothing to do with the slowdown in the current industry’s plans.  

According to recent reports, it has been said that the makers and the top-level managers of the Maruti Suzuki have noted that the existence of the Ola and Uber has been there for the past seven years. During the peak time, there was no such slowdown in the current condition of the automobile business. They have said that they do not think that these services are responsible for the slowdown in the industry in any other way.  

A personal opinion shared by the people who use ridesharing plus a car

But have you given it a thought? Is it true that traveling via Ola or Uber will help you to cut down your costs more than paying the personal loan for your Car? As the service of Ola and Uber is growing in the market, some are wondering which might be easier to hail. Getting a car of your own is undoubtedly a cherry on the top, but somehow you have to understand that getting a vehicle is not the final thing that happens here. 

You have to take care of the loan and the EMI budget of your Car so that it can be done at the right time and paid off. It will help you to ease off your burden. This complex question is rising in the minds of the millennial, but we might help you to get an insight into the matter and take it sincerely. 

Owning a car is better for long term rides, sharing a ride will be good for the short term. It is a golden rule that you should learn from this article. 

Here is the main deal. If you have a car of your own, then you can take it for a ride at any time of the day that you want. Primarily they are needed when you want to travel and cover the long term.

Car ownerships might be affordable for people who drive typically medium to long-distance or about 20km. Whereas, the ride-sharing apps like Ola or Uber happens when you want to cover a short span of about 7 km. However, these findings are based on some back details as well.

The cost of the Car that you have depends on the on-road price of that car that you have bought, the fuel price that you have to pay for it. The maintenance charges are even varied here.

To explore this part of the question, take for example that Datsun Go is for Rs 3,50,000 – 5,20,000 and it takes about a 5-year car loan with a whopping amount of 10% of the rate of interest. Over that, you need to have six years of maintenance for that Car when the full cost is covered onto the same. There are some potential car issues which can happen here as well.

For the medium or long trips-owning, a car wins

buying a car vs Ola or Uber ride

For an individual who trips on the basis of the medium or the long trip wins here. We ‘have also found the fact that owning a car is about 44% cheaper than sharing a ride if you cover the long-distance or even the mediocre ones.

Short trip rides- the cabs win

buying a car vs Ola or Uber ride

Rideshare is in for short trips. We have found out that typically people who take journeys of about or less than 10 km wins on the Rideshare here. It becomes 24% cheaper for them. If your twice-daily rides are about for 7 km, which means one ride will time up for 15 minutes, the Rideshare or the app cab will win here. Due to the lower distance of your trip, the 5-year cost plan for your Car decreases by a rate of about 25%, and it can save a lot on the fuel consumption here.

However, in the current period, the cost of an Uber or Ola is becoming cheaper by 56%. It illustrates the fact of how you use it and how much consumption is made from your side.

Also read: How much does a Wedding cost in India? (For Average Indians)

Is Rideshare the right replacement for you?

The final verdict says that Rideshare is only a feasible replacement, for the people who want to have a shorter distance of their ride. If you are a typical short distance traveler, then the Rideshare will be a viable option for you. Of course, the cost consideration which is charged varies on your location and even the individual who is paying for the same.

If you have your Car, you can take it out on a trip if you want. You can even cover the longer distance if you wish to so with the help of your Car here. Of course, there are parking tickets you have to pay, regular maintenance of your vehicle, take your vehicle to the car wish, etc. But it will be an excellent option to invest in if you are an avid traveler.

Mainly if your place of work is situated far away from where you live, it is essential that you get a car of your own. If you use the Rideshare each and every day here, it will cost you a lot.

Additionally, you can even supplement ride sharing to motorbike ride-sharing apps like Rapido. They will cost you less. And also purchasing your motorcycle is a much cheaper option for vehicle ownership.

October 1, 2019 Personal Finance 1 comment
Fear of Missing Out

What is the Fear of Missing Out and how you can overcome it?

In this article, we will help you to understand the fuel of what triggers your fear of missing out, which is commonly known as FOMO. It has become a popular internet term for teenagers to use these days because according to a recent survey, it has been said that around 6 out of every ten teenagers have been faced with FOMO. It is the feeling of constant depression and anxiety in you that you are being left out from your social groups and even your own family. While others are having an exciting event, you are always being left out or pushed to the corner. 

The term may be new to some people, but it surely is not. FOMO has been happening for a long time now, but since science was not so evolved back then, people commonly mistook it as depression. If you have FOMO or you are suffering from it, then you are at a constant understanding that someone out there has it better than you or doing better than you.  

Especially the fear triggers in this digital age since we always tend to check on each other’s profile to know how we all are doing. And this, in turn, is creating a void or space in us, which is keeping us away from confronting the constant struggles that we are facing due to this hard-hitting mental disorder.

From where FOMO( Fear Of Missing Out) comes?

FOMO is a common phrase that is used by the millennial these days. They might be able to explain the fact of what is happening to them, but most of them lack the intellect to explain how it happens. So here comes and lies the main question. How is FOMO(fear of missing out) affecting your life?

Well, FOMO mainly occurs because the advent of social media has created dawn on time. With the use of the more extensive function of social media, each and every one of us are comparing our lives to the people who are living online.  

Mainly this happens with the top influencers that you see on social media. Sure at the age of eighteen or sixteen, they are making a massive load of cash but what you see on your screen is not what happens in the real stage of life.

fear of missing out

Social media is causing a wave of depression in children or millennials. They are trying to live their life as their’ so-called influencers’ but often end up thinking about how insecure they are. This comes with added symptoms like depression, anxiety, inferiority complex, lack of communicational skills, etc.

FOMO creates a distance of you from the outside world, and this is why the teenagers are always locking themselves up in their bedrooms and weeping over countless things. FOMO can trigger a lot of health issues as well, which in turn can cause these people to binge eat or go without food for the whole two days or more.  

How to overcome FOMO?

When you first started to learn a car, did you rapidly learn how to shift the gears too? Well, the same thing is done here as well. Surely you are suffering from anxiety and depression, maybe even a lot more than others, but you have to take gradual steps so that you can overcome mental disorders such as FOMO (fear of missing out). 

Here are some tips and ideas which you might need to follow if you want to embrace your JOMO (the joy of missing out).

1. Slow down and move at a pace. You need to stop rushing down the things that you do physically and even the items inside your mind. Practice some time out when you are eating, talking, making a pleasant conversation with someone. These days, we are always in a hurry to leave for things, but it inevitably becomes an essential or crucial part of our lives to slow down and enjoy the smallest joys that life has bestowed on us. Set a mental reminder to yourself. You need to feel the things that you are doing every day. Make sure that you are not doing in terms of a chore. Instead, love the things that you are indulging yourself in.

2. Go for the experience and collect the memories in your life. It might feel like a stretch to you, but if you are going for the symbols, then you are wasting the potential years of your experience. If you want to do drugs just because your friends think that it is fresh, learn to say no to them. Instead, pack your bags and ditch your phone and plan a hiking trip with your family or even your best friend. Studies have shown that people who take adventure as a course part of their routine are more likely to rejoice in life.

3. Be willing to say no to things. If you are obsessively stalking your crush’s page on Instagram and finding that he/she is posting pictures with their near-perfect dates, you are going to feel the pangs of depression right inside your heart. This is the prime reason why you have to learn to say no to your mind. Always remember that a sound intention is hard to overcome. Whatever challenge may come to your way, stay determined towards the goal that you have set for yourself. Don’t falter, and you will surely get the results.

4. Do one thing at a time. Yes, you might think that you can overcome the fear of missing out while you are multitasking, but instead, you are putting in a lot of pressure on yourself. You need to focus on one thing at a time to understand the importance of the subject that you are swelling with. Psychologists have said that our mind is like a speeding race car. You might put to any gear, and it will shift the pace. If you want to stop your anxiety due to FOMO, you need to settle down and calm for a bit. 

Also read: How to learn faster- The Feynman Technique!

Can mindfulness help with your FOMO?

fear of missing out

Surely mindfulness can help you to overcome FOMO. Rather than chasing what you cannot have in your life, you need to understand that the best things take time. Pursuing the things that you want in your life will create a false sense of happiness. It will be for a short period of time, but eventually, it will fade away.

To overcome your FOMO, you need to be aware of your surroundings and in the right way. Once you have learned to master your mind, you will eventually find a better cure for yourself.

Also read: What are Mental Models? And Why Should You Care?

September 30, 2019 Investing Psychology No comments yet
How to check your credit score?

How to Check Your Credit Score?

In this world of the internet, everything is possible. From paying your gas bills to checking off your loan repayment or even how much credit score you have, everything is near our face and at the palm of our hands. Earlier it was a huge deal to check your credit score because people had to get permission from their respective banks and get the work done. But this is not the case anymore. If you can sit at the comfort of your own home and create an account, you can check your cibil score or credit score if you have a laptop, a desktop and even your mobile phone with an active internet connection.

So why you need to check it?

Lenders are always trying to fish into your credit score. Your credit score matters to you, and even when the time you are obtaining personal or home loan. Your credit score is the primary determinant as to how fast you will get your loan right on time.

Whether you have a credit card or you have opted out for a mortgage, your credit score will follow you everywhere you go. So it becomes practically inevitable for you to escape from the worst which could happen. It is a score that reflects on your credit track record, and the more you make your payments on time, use the better or lesser loan, etc., the better your score will be.

So how can you check your credit score?

If you want to check your credit score, then you have to go through the CIBIL check. You might think that this is yet another complicated term up in your way, well it is not.

CIBIL means Credit Information Bureau India Limited. It is leading credit rating agency which helps to keep track of all your credit transaction and records. It helps to shine a light on your creditworthiness as well.

Due to the presence of CIBIL, the people of India are financially stable now and can check off their credit rates on the online. It has managed to make the financial markets permanent with the knowledge of educating the people to what they want and how they should process their spending. It is because of CIBIL that the financial market is transparent.

And it has sown a structure for the Indian people to rely on so that they can do the best for themselves and make sure that they can manage the risks as well as control their lousy loan from the bank that they are taken their amount in.

Also read: 10 Best Credit Cards in India [With Exploding Benefits]

How do the CIBIL works?

When you want to check your credit score from the online source, then you have to take the help of the CIBIL here. Banks and financial institutions from all around will first get their access through the CIBIL before they grant you any loan.

The CIBIL check which is done is based on the generation of the credit score. It is a three-digit number which works and ranges basically from 300 to 900. If you have a credit score below 300, then it is said that it is inferior. This is when the lenders will often time hesitates before granting you the personal loan. The next thing is if your score is around 900, then it is ideally the best credit score that you can have.

credit score range

(Source: NerdWallet)

Every month, all the banks and the institutions that grant your credit will check off your CIBIL score to understand how they can give you permission for certain things. This, in turn, helps the bank and the employees to judge your credit rating and choose the right applicants for granting the loan amount.

This way, they can get the repayment right off the bat without having to put a second thought to it. If the banks and the financial institutions are checking your credit score, then you need to make sure that your score should be above 700. If it is below that, then most of them won’t avail you to make usage of their service that they have.

Also read: Everything You Need to Know About Your Credit Score.

Steps to check off your credit score

Here are the steps you need to follow if you want to check off your credit score with the help of the CIBIL records. 

  1. You need to initiate the whole process by filing for a form which is present onto the official site of the cibil website. If you have filled up the way, then it will be right for you and easy for you to check off your credit score too.
  2. Now you need to enter your personal details. This is your name, your phone number, your address, etc.
  3. If you want to opt-out for the CIBIL Transunion score or which is also known as the CIR, you have to pay a nominal fee for the same.
  4. Once you have submitted your form, and with the nominal fees, your credit or your CIBIL score will be mailed to you.

For those who have not yet found to work out through the internet life, you can check your credit score with the help of the offline function too. You need to fill in the form of application and then bring in your documents to the official CIBIL office which is located in Mumbai, and your work will be done. It will help you to understand your credit score better.

Now here is some trick you need to know before you apply in for your credit score check through CIBIL. 

  1. Checking CIBIL score is FREE. You will be firstly offered a lot of paid options if you are trying to check off your score. If you want to check your score of once then you can click onto the No thanks option which is located at the bottom.
  2. If you don’t have your account, then you have to make one but If you do have then you can log in using your password and username. For those who are creating their account for the first time, they will be prompted to open an account with a pseudo password. Once you have opened the same, you will be mailed to change your password ASAP.

Note: If you are yet to get a credit card, here is a quick link to check your eligibility and apply for credit cards online.

Check your credit score for good

If you ask me, it is not advised to check your credit score only once because it can fluctuate over time. Check your credit score every quarter or six months. So if you wish to keep an eye on your score, then there is a plan which you can select which is present onto the website. This way, you can save a check on them and help to maintain a good credit score with an overall well impact.

September 24, 2019 Credit Cards No comments yet
80_20 Rule

The 80/20 Rule or the Pareto Principle- How it can change your life?

Have you ever wondered something? That some of your mates or even your business partners do a little and get a lot in return. Well, is that black magic? It might not be because a scientific method which is known as the Pareto’s principle or 80/20 Rule is here to explain the whole deal to you. 

Understanding the knowledge of the 80/20 principle

The 80/20 is sometimes known as the Pareto principle. This was originally an observation made by Vilfredo Pareto that around 80 percent of the world’s wealth is only owned by 20 percent of the population. We are not here to discuss economics right. We are here to decipher the whole trick and help you to prepare for your life scores in the best possible way needed. 

There are some simple tricks that you need to apply to your Life because mugging up won’t do you any good. Living smart is the option right now, and with that comes the need for your presence of mind. Successful people who know how to advance their Lives already have learned the 80/20 rule. It always helps them to prepare life exams and to ace the results later. 

While it does not seem like it is the precisely 80/20 rule which works here, these imbalances are seen in your Life and often in other cases as well.

To this day, the 80/20 rule applies in real Lifelike:

  1. Most of the time, you will see that only 20 percent of the people have the riches of the world, and 80 percent have half of it.  This might seem unfair but it is how it is. 
  2. In your exam time, you can see that students who only study about as little as they want, they will get 80 percent of the marks. The rest of them will attain lower grades.  
  3. In your business analytics, the managers or the workers who only spent less time of their work into the business then they are obtaining 80 percent of the incentives. The 20 percent is attained for the lower part of your motivation.

The 80/20 Rule to advance your Life

You might be wondering what the 80/20 rule is so here we will cover it for you. For instance, living with a limited amount of resources for a day can be hard for you. Under final observation, it is seen that different people have a distinct style of coping, and that is how the whole factor is determined.

Studies have seen that people who have only put 20 percent of their effort have scored above 80 percent of the results toward’s their achieved goals. 

You might be thinking that how it really happens but well, there is a trick to it. Don’t apply if you don’t know the entire rule. The beauty of the 80/20 rule is that it works for you, and it is quite simple to understand as well. Even you can turn around your life in just a single way if you are using this strategy. If your friend is struggling and always finding it hard to cope better with their Life, then you can recommend this to him/her as well.

How does it work?

 

80/20 rule

(Image credits- Buffer)

One of the best mental models that you can get around for yourself is the 80/20 or the Pareto principle. You can basically apply it in your daily life, and it helps you with a lot of things that you want to improve in. Like if you wish to have better learning skills, use this principle to do better. This can also be used by people who want to analyze better ideas for their business and else.

Well, the 80/20 rule is used to improve everything in a well-systematized way.  

If you are a typical analyst of Life, then what do you do? You spend half of the time into sulking the fact that why you are not getting your dream job or doing productive work in a single day. Your version of living Life is wasted onto the thoughts that you put inside it. Pareto’s principle is the mental model you can use.

You need to understand where your focus lies and make sure that it sticks to it. You need to have a core and basic understanding of your surroundings. Here, you cannot dive into the growth of the process. You have to get the pieces together, and only then you can dive into the success of Life. By putting the right type of focus on the work that you do, you will be changing your Life for the best. It will help you to get a charge on your Life.

Using the 80/20 rule for your benefit

Well, according to the Pareto principle, you need to devote a few hours of your time and focus on the thing that you want in your life. 

The rest of the time which you waste should be accounted for a minimum part. It is only for a smaller potent. This does not usually happen to the majority of the people out there. They will take their time to understand and then focus on their Life.  Here is something you can look out for. 

  1. Make sure that you only spend 20 percent of the time in understanding your goal. Understand that the 80 percent is meant for you to persuade it. 
  2. When you are wasting your time, waste only for 20 percent, rest, use it for your source. 
  3. Eighty percent of your time is spent on the mindless hunting of better apps and fiddling with your phone. 
  4. Use the 80 percent of your time into collecting the information you need to change your Life. The best hack lies here.

Prepare for the best 

These preparation strategies are here to improve the potency of your Life and advance the options. Using Pareto’s principle will help you to find the best meaning to Life. Always understand that keeping the priorities ahead of you will help you to land somewhere in Life.

September 23, 2019 Investing Psychology No comments yet
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