Credit cards : the legal relationship between the parties

Abstract

The credit card has today become very much part of each and everyone's daily life. In its early days, it was somewhat of a status symbol - a prestige item - in the sense that the first credit cards were initially granted only to an establishment's most valued customers and served the purpose of identification as well as being an efficient method of keeping track of customer purchases. In the past twenty years or so, the credit card has evolved to such an extent, that from a luxury, it has become a necessity. Indeed, in certain circumstances, the only method of payment accepted, is charging the card. Today, credit cards are issued to virtually any person who applies for them, from students, to wealthy businessmen - naturally, with diverse credit limits! In this examination of the credit card transaction, I shall be going into the legal niceties of the relationship between the parties, however, in order to understand this position fully, I must first distinguish between the credit card and any other plastic card, which may or may not be issued by a bank. A brief glance through the development of the card will help us understand this better.