Question

In: Accounting

FINDtwo different credit card applications (e.g., online, at restaurants, etc.). COMPAREthe two credit card offers by...

FINDtwo different credit card applications (e.g., online, at restaurants, etc.).

COMPAREthe two credit card offers by completing the chart below to describe key features of each.

Credit Card Feature

Card #1

What is the name of the Credit Card?

What is the APR (annual percentage rate)? Is it fixed or variable?

Penalty APR and trigger events when it is charged

Annual fee

Late fee

Over-the-limit fee

Transaction fees (balance transfers, cash advances, etc.)

Grace period

Method for computing account balance

Rewards for use

Other features

Credit Card Feature

Card #2

What is the name of the Credit Card?

What is the APR (annual percentage rate)? Is it fixed or variable?

Penalty APR and trigger events when it is charged

Annual fee

Late fee

Over-the-limit fee

Transaction fees (balance transfers, cash advances, etc.)

Grace period

Method for computing account balance

Rewards for use

Other features

Which card offers the best deal and why?(write a paragraph below)

Solutions

Expert Solution

Name of the card

Moneyback HDFC Credit Card

Citibank Rewards Credit Card

APR 3.49% per month 3.25% per month
Fiexd/ Variable Fixed Fixed
Annual fee Rs. 500 Rs. 1000
Late fee 10% of amount outstanding Based on balance outstanding slab wise
Transaction fee 2.5% of amount withdrawn 2.5% of amount withdrawn
Grace Period 3 Days 3 Days
Rewards
  • Earn 2 Reward Points on every Rs 150 spent
  • Earn 2X Reward Points i.e. 4 Reward Points on every Rs. 150 spent online
  • Every quarter, get a gift voucher worth Rs. 500 on spends of Rs 50,000. Earn up to Rs. 2,000 worth gift vouchers in a year. Click here for more details.
  • Get 1,000 bonus points on your first spend of ₹1000 made within 60 days of card issue

  • Get 300 bonus points on card spends of ₹30,000 or more in a month

  • Earn unlimited 10X Reward Points at selected partners

  • Earn 1 reward points for every ₹125 spent. Reward points that never expire

  • Earn 10X Reward Points on spends at apparel and department stores

  • Earn 1 Point for every ₹125 on all other purchases

  • Up to 15% savings across 2000 restaurants

From the above comparison its fairly clear that the Citi Rewards Card is a better deal for 2 major reasons, firstly its rewards and benefits are far more widely spread across spending avenues hence better from a customer stand point. Also because its monthly interest rate is less than the HDFC credit card thus relatively cheaper.


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