Credit card guide

Are you thinking about getting a credit card or do you already have one? Can you understand what all the different banks are offering? Are you able to manage your credit card effectively? Do you know all the benefits and risks of a credit card? We have compiled all the important information you will need when using your credit card.

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Why get a credit card?

The credit card gives you flexibility and financial independence in your daily purchases (food, household supplies, clothing, shoes, etc.) as well as for unexpected events (your washing machine breaks and you don't have enough money to get it repaired).

The credit card also offers easy management of funds - thanks to regular monthly statements, you can keep track of your monthly expenses.

The credit card is a type of credit that the bank extends to you. By using the card, you take out a loan that you pay back later. With each credit card payment made, the available credit limit automatically increases again by that amount, so you can use it repeatedly (as revolving credit).

You don't need a guarantor to obtain a credit card. Usually, your bank will not even require you to open a checking account with it in order to get a credit card.

The bank will set a limit (the credit limit) for the funds you can regularly use with your card. It's basically up to you how you use the money (e.g., purchasing goods or services at a store, cash withdrawals from ATMs). Usually, however, the bank limits the possibility of using cash by imposing a cash limit equalling for example one half of the total credit limit.

With the credit card, you use the bank's money, while your own money can earn interest in a savings account.
Credit cards are exceptional in their unique method of payment - unlike with other credit products, you repay your credit card balance as best suits you:
- You may take advantage of the interest-free period and pay the entire balance owed by the due date shown in the statement - in this case the bank charges no interest and you borrowed the money completely free of charge (this usually does not apply to cash withdrawals, which are subject to interest as of the date of withdrawal),
- or you may make the required minimum payment by the due date - this is obligatory,
- or you may pay any other amount between the minimum payment and the entire balance owed, as you see fit.

If you do not pay the entire outstanding amount by the due date, but only a part of it, the bank will charge interest on the owed amount in accordance with its price list (see the Interest chapter).

The credit card is secure.

	If you lose your wallet, you have lost all the money inside, and no one will compensate you for it.

A credit card, in contrast, is not that easy to misuse. What's more, you may insure it against fraudulent misuse. Once you report the loss or theft to your bank, it will block the card and you usually cease to be responsible for potential fraudulent misuse. In addition, you may set up insurance against misuse of your card in case of loss or theft.

Why is the credit card more advantageous? A comparison of credit cards with other products available on the market.

A comparison of credit cards and consumer credit

Credit is subject to interest from the time you start using it, while with credit cards you have an interest-free period ranging from 35 to 55 days.
Credit is repaid in pre-agreed constant monthly payments, while with credit cards the holder can decide how to repay.
With credit, if you make a monthly payment is not in accordance with the schedule (extraordinary payment, early repayment), you will pay a contractual penalty.

A comparison of credit cards and overdraft

When you overdraw on your account, you pay interest on the respective amount from the very first day.
The whole amount must usually be repaid to

A comparison of credit and debit cards

With the debit card you use your own money, while with the credit card you use the bank's money.
The money is deducted from your account immediately upon the purchase or cash withdrawal made with the debit card.
You may only buy up to the balance in your checking account.
If a lost or stolen debit card is used, the money you have in your checking account is effectively stolen.

A comparison of credit cards and charge cards

At the end of the settlement period, you have to repay the whole amount you used by the due date.

How to choose a credit card

Before you apply for a credit card in a bank, read through the available information, check the fees, and compare the benefits associated with the card. Here are a few tips to help you decide which card to apply for.

The length of the interest-free period

The interest-free period is a period during which the bank grants credit free of charge, i.e., without charging any interest - but only if you repay the entire amount owed by the due date as indicated in the statement, i.e., by the end of the interest-free period.
This period is usually between 35 and 55 days.
The interest-free period does not usually apply to cash withdrawals.

Example:

	During January, you use your credit card to make purchases at stores. As of the last day of January, the bank issues a statement due on 25 February. If you repay the entire amount owed so that the bank receives the money by 25 February, you will not be charged any interest on the amount of credit you used, and you will have made full use of the interest-free period.

Minimum monthly payment

The minimum monthly payment is the amount you are required to repay every month by the date indicated in the statement.
This minimum payment is usually a small percentage of the amount used. At the same time, there is usually a fixed minimum monthly payment that you must pay if the percentage results in an amount lower than the fixed minimum monthly payment (e.g., minimum monthly payment of 3.2% of the current balance but not less than CZK 200).
The lower the required minimum monthly payment, the more flexibility you have in deciding how much you will repay.

Additional services

Credit cards may be linked to various supplementary services and insurance products.

Ensuring the issuance of a replacement card or provision of cash while abroad - if an unpredictable event occurs and your credit card is lost or stolen and you find yourself without funds, the bank will either arrange for you to receive cash, or deliver a new credit card wherever you are.
The option to spread out purchases made by credit card over regular monthly payments at interest rates that are more favourable than the normal interest rate associated with the credit card.
Insurance against card misuse protects you against credit card fraudulent misuse.
Repayment insurance protects you if you are not able to make the minimum monthly payment for example due to health reasons.
The credit card also offers travel, accident, and other insurance.

Fees and their amount

Make sure to find out the regular card maintenance fee (an annual or monthly fee), the monthly fee for credit card account maintenance, potential penalties in case of failure to meet the due date or for exceeding the credit limit (see the Fees chapter).

Card blocking and issuance of a replacement card

Usually, your bank will charge you a fee for blocking your card and subsequently issuing a new one, but some banks do not.
Similarly, banks differ in how long after reporting card loss or theft, or after blocking the credit card, you are still responsible for potential transactions. Some banks offer insurance to protect you from responsibility for transactions performed before you learned about the loss or reported it.

Other benefits that may be associated with credit cards

Discounts at selected stores when paying by credit card. Co-branded cards are usually a result of an alliance between the bank and a commercial partner (e.g., a retail chain, airline company, petrol station). Payments made with this card are rewarded points in the loyalty program, and you may then redeem these points as discounts or rewards (e.g., bonus flights).

Tip: How it works at Citibank

Citibank offers several credit card options, from a basic card, which carries no fees for issuance or maintenance, through a highly prestigious gold card, to various co-branded credit cards that give you discounts and possibly other benefits with companies like Telefónica O2, Shell, or ČSA.

More information on the credit cards offered by Citibank is available here.

Applying for a credit card

If you have already selected the credit card you would like to have, you usually need to contact the bank's info line and make an appointment with a representative or visit a branch.

The bank will verify your identity - have your ID card and possibly another proof of identity ready. You may be asked for proof of income or for your tax return from the previous year. Your bank will likely also want your consent that it may request information about your credit score in the Banking or Non-Banking Register of Client Information (which contains information on how you have repaid other commitments to banks or loan companies, if any).

Before signing the application please verify the card information and read the conditions and the price list carefully. Your application will be assessed according to the bank's internal rules. You will be informed of the result in a letter or other means of communication.

Tip: How it works at Citibank

Have you selected the Citi credit card? Congratulations! You needn't go to a branch. A Citibank sales representative will be pleased to come to you - you may meet at a place and time that suit you. All you need to do is contact us at 844 888 844 or apply online here (in Czech).

Activating the credit card

Once the bank approves your application for a credit card, it will assign a credit limit to your credit card account.

The credit limit is the maximum amount that you may spend using your credit card.
The cash limit is the maximum amount you may withdraw from ATMs using your credit card. This limit is usually part of the overall credit limit.

The credit card is usually mailed to you, or you may pick it up at a bank branch. Sign your card immediately upon receiving it - you will use the same signature as confirmation of your purchases at vendors.

The credit card is linked to a PIN which you will need for withdrawals from ATMs (four digits). If the credit card has a chip, you will enter your PIN also when making in-store purchases. The bank will send you your PIN in a letter (often registered or personal delivery), or give it to you at the branch. In some cases, you may set your own PIN.

If the card is mailed to you, it will usually be inactive for security reasons. Before using the credit card, you must activate it. Activation can usually be done via telephone banking, at a branch, or by withdrawing cash from an ATM.

After activating the card, you may use it immediately at a store or for cash withdrawal from ATMs. (Watch out for fees associated with the withdrawal - see the Fees chapter for more information.)

Tip: How it works at Citibank

Citi credit cards are sent by mail (regular mail) to the address specified by the client. The card sent to you is inactive for security reasons. To activate the card, call the toll-free activation line at 800 122 228 and set your own PIN for the card:

A four-digit A-PIN (for in-store purchases, withdrawing cash from ATMs, or for the first login to Citibank Online Banking),
A six-digit T-PIN for easy and quick access to CitiPhone

Choose a combination that is easy to remember.
Always keep your PIN secret.
You may change your PIN at any time free of charge.

When you first contact the CitiPhone line you will go through a verification procedure to reduce the possibility of fraudulent use by an unauthorized person.

Whenever you contact CitiPhone thereafter, you will use the T-PIN you set. The operator will ask you about two randomly chosen digits from your T-PIN.

Activate your card by calling the 800 122 228 activation line.
Sign the signature strip on the reverse side of your card.
Put the card in your wallet and you are ready to start using it.

Credit card security

For you, the card is equivalent to money, so you should treat it with the same care and try to avoid its loss or theft. Keep your card in a different place from your pieces of identification.

If you are not sure where your card is (even if you have not yet activated it), contact the bank that issued your card immediately and have the card blocked. This will help you avoid possible financial losses.

You may arrange additional insurance, which most banks offer, to protect yourself against any fraudulent transactions performed before you realize that your card has been stolen or lost, or before you can block it.

Warning!

Never write your PIN on your card. If your lost or stolen card has been misused in a way involving the PIN (e.g., ATM withdrawal), you will be responsible for any losses.

If you forget your PIN, you may always ask the bank to issue a new PIN. This is usually subject to charge.

Tip: How it works at Citibank

Citibank will block the lost or stolen card free of charge. The issuance of a new card is free of charge as well.

Citibank offers insurance against credit card fraudulent misuse. This insurance also covers the loss of documents and keys. For more information about this insurance, click here.

Citibank assumes responsibility for any credit card fraudulent misuse from the moment of the announcement of such a loss or theft. This, however, does not apply to transactions involving PIN use. We also offer additional insurance covering credit card fraudulent misuse which occurred 72 hours before the card was blocked.

Fees

Your credit card will certainly involve some fees.

We recommend that you read through the bank's price list carefully before deciding which card you want to apply for.

We suggest that you pay particular attention to the following charges:

Card issuance fee - a one-off charge.

Card maintenance fee - reflects the costs associated with card maintenance. This fee is usually charged annually or monthly.

Credit account maintenance fee - this fee is usually charged monthly.

Monthly statement fee - creation and sending of the statement are subject to a fee.

Cash advance fee - you will usually be charged a fee for withdrawing cash from an ATM or at the bank counter. Cash withdrawals are usually subject to interest immediately, regardless of whether you repay the entire amount by the due date or not.

Fee for card blocking or issuance of a new card - the bank may charge you a fee for blocking your card after loss or theft thereof. You may also have to pay a fee for the issuance of a new card.

The following are the possible penalty fees:

Fee for late payment - if the bank does not receive at least the minimum required monthly payment by the due date shown in your statement, you will usually be charged a penalty fee.
Fee for exceeding the limit - if you exceed the credit limit set by your bank, you may find a penalty for exceeding the limit in your statement.

Tip: How it works at Citibank

Citibank offers the Citi Classic credit card without any fees for its issuance and maintenance and it does not charge anything for credit card account maintenance either. Blocking a card and issuing a new one are free of charge at Citibank.

Please refer to our Pricelist here.

Credit card use

Paying directly at the merchant is convenient for you, and does not carry any fee.

The network of merchants accepting cards is very broad in the Czech Republic and worldwide. The network includes grocery stores, clothing stores, petrol stations, restaurants, hotels, travel agencies, and so on. You may usually use your credit card to make online purchases.

When you have an internationally valid card, credit card transactions performed abroad are more advantageous than cash payments.

Usually, no fee is usually charged for paying with your credit card abroad, and the conversion rate used for non-cash transactions is usually lower than the exchange rate that applies to cash exchange at the bank branch or at an exchange office.

You will pay fees for cash withdrawals from ATMs. The interest-free period does not usually apply to cash withdrawals. (This means that funds are subject to interest using the given interest rate immediately upon the cash withdrawal from the ATM regardless of whether you repay the money by the due date or not.)

In general, credit card acceptance is extremely widespread in the Czech Republic and abroad.

Suggestion

If you pay by credit card at stores and then repay the balance owed by the due date indicated in the statement, you may take advantage of the interest-free period, i.e., use the borrowed funds free of charge.

Where to use your credit card

when paying for goods and services at merchants in the Czech Republic

You may pay at all stores that accept MasterCard and Visa cards. For payments at chip terminals, you will need a four-digit A-PIN you may set via our CitiPhone customer line when activating your cards.

when paying for goods and services abroad (Citi credit cards are accepted at stores worldwide)

To withdraw cash from ATMs in the Czech Republic and abroad

You may withdraw cash from any ATM displaying the MasterCard or Visa logo. The interest-free period does not apply to this service. The amount is subject to interest from the day of withdrawal in accordance with Citibank's Pricelist.

For booking, guarantees, and advance card payments

When making a reservation (e.g., hotel, guest house, airline tickets) or providing a guarantee (e.g., car rental, hotel), you will share your card number and expiration date, your name and address with the vendor. The merchant performs an authentication check to find out whether you have sufficient funds on your credit card to carry out the payment.

Please check that the company is reliable and trustworthy. When paying online, use only trustworthy stores and read their commercial and complaint procedures.

The 3D Secure service enables secure online purchases. When paying online, the credit card holder is prompted to enter a one-time code sent to their cell phone. All you need to do is call the CitiPhone customer line at 233 062 222 and activate this feature.

Through the imprinter

If the merchant is not connected to its bank via an online payment terminal but owns an imprinter, you may still use your embossed Citi credit card.When paying by credit card through an imprinter, the vendor copies the embossed characters from the card in the receipt. Furthermore, the vendor prints information contained in the identification label of its premises (shop, hotel, gas station, etc.).

The vendor also adds the date and price in the receipt with the aforementioned copied data and has you sign it. Please carefully check the accuracy of the amount and currency (e.g., CZK, EUR, USD). If the amount or currency is not correct, do not sign the receipt. As it is prohibited to strike out or overwrite anything in the receipt, please ask the vendor to issue a new receipt with corrected data.

Details in the receipt must be completed with a ballpoint pen. The vendor will always return the card with a copy of the receipt. Make sure the information is legible.

Please keep your receipt and check your credit card statement to see if you have been charged the correct amount.

If you would like to make a large purchase, the vendor may ask you as the card holder to present ID.

Cash withdrawals at branches of banks and exchange offices

When withdrawing cash at branches and exchange offices, a procedure similar to that for in-store purchases is used. However, you must always present your ID card. You will be charged a fee for cash withdrawals using the Citi credit card. In this case, the interest-free period of up to 55 days does not apply to the credit card, and the transaction is subject to interest from the date of withdrawal.

Should you encounter any problems when paying by card, please contact the CitiPhone line immediately.

How to read statements

You will receive regular credit card statements. The statement is sent as of the last day of the month, or regularly as of a certain day of the month (e.g., the 11th day).

If you used the card during the month but have not received the statement in the usual period (date of statement plus approximately five business days), please contact your bank immediately.

Check your statement immediately upon receipt. Should you discover any discrepancies or a transaction you have not made, please contact your bank immediately. The bank will initiate the dispute procedure through the association with which the card was issued (MasterCard or Visa). You are usually not required to pay for this transaction, and the bank will not decrease your credit limit by the respective amount. The dispute procedure may take up to several months. The bank will keep you informed about it.

Attention!

Even if you have not received the credit card statement for some reason, you are responsible for the transaction/balance owed. If you fail to receive the statement approximately 7 days from its issue, contact your bank.

The statement normally contains the following information:

The credit limit approved by your bank

The available credit that you can still use (as of the date of issuance of the statement)

Account balance - the total balance owed as of the date of issuance of the statement, which consists of:

unpaid amounts from previous periods/statements,
new purchases and cash withdrawals performed until the date of the statement,
fees or interest, if applicable.

Minimum monthly payment - usually a percentage of the account balance. This payment may also contain the amount by which you exceeded your credit limit, or various fees. This is the lowest possible amount you are required to pay by the due date to meet the bank's business terms and conditions. In the event that you make only the minimum monthly payment, your account balance will be subject to interest in accordance with the Pricelist, as you will see in the subsequent card statement. You are required to pay interest on the unpaid balance that is carried over to your next statement. The minimum monthly payment is certainly one of the essential criteria in deciding which card to apply for.

Due date - date by which the minimum monthly payment must be credited to the Card account;

A list and detailed description of transactions made and, if applicable, of fees and interest

Potential dispute of a transaction

Tip: How it works at Citibank

Disputing your statement

If you dispute a transaction, Citibank will refund it to your card immediately until the definitive resolution of the dispute.

Click here for a sample of the monthly credit card statement (in Czech).

Increasing your card limit

Interest rates

The credit card is a credit product. Under certain conditions, you will be charged interest, which is a cost for using credit. The Pricelist contains a monthly or annual interest rate.

If you take advantage of the interest-free period and repay the entire credit card balance by the due date indicated in the statement, the bank will not charge you any interest.

If you do not repay your balance owed from the previous period in full by the due date, you will be charged interest, usually using the interest rate indicated in the interest rate list or in your bank's price list.

If you withdrew money from an ATM, interest will be charged from the date of the cash withdrawal until the date on which the statement was issued. You will be able to see the interest charged in your statement. The interest will thus be charged even if you repay the entire balance owed by the due date. The interest-free period usually does not apply to cash transactions (sometimes this includes highway tolls).

Example:

During January, you use your credit card to make purchases at stores.
As of the last day of January, the bank issues a statement due on 25 February.
You will make the minimum monthly payment or amounts lower than the total balance so that the bank receives the money by 25 February.
The statement issued at the end of February with a due date of 25 March will contain interest that will be a sum of interest computed for individual transactions (from the date of the transaction or its booking until the date on which the statement is issued minus any potential monthly payments) using the interest rate in the bank's Pricelist.

Tip: How it works at Citibank

How to pay your credit card balance

Credit cards are exceptional in their unique method of payment - unlike with other credit products, you repay your credit card balance as best suits you according to your current needs and options - but you always have to make at least the minimum monthly payment indicated in the statement by the due date.

You may either take advantage of the interest-free period and pay the entire balance owed for the statement period by the due date shown in the statement - in this case the bank charges no interest and you borrowed the money completely free of charge (this usually does not apply to cash withdrawals, which are subject to interest from the date of cash withdrawal),
Or you may make the required minimum payment by the due date, and the bank will charge interest (see the Interest chapter),
Or you may pay any other amount between the minimum monthly payment and the entire balance owed as you see fit, and the bank will charge interest (see the Interest chapter).

Your credit card balance may be paid in many different ways. However, the minimum monthly payment always has to be made to the card account by the due date. Allow several days for payment processing, usually:

Bank transfer - two business days,
Postal order - 7 to 14 days,
Payment in cash at a bank branch - same day, but at relatively higher fees associated with the cost of this transaction,
Direct debit - the bank itself sends a request for direct debit three to five business days before the due date.

Attention!

Do not underestimate the due date and always make your monthly payments on time. The bank will usually charge a penalty for late or missed payments. Late or missed credit card payments will be reported in the Banking Register of Client Information and can have an impact on your credit history and creditworthiness. In future, you may have difficulties with further applications for credit products.

If you have financial problems and have difficulty repaying your credit card debt, do not underestimate the situation and contact your bank immediately. The bank will try to help you solve the difficult situation in a mutually advantageous way and can agree to an extension or to a pay by installment plan.

Tip: How it works at Citibank

On the same day of every month, we will send you a detailed card account statement with all transactions made and, if applicable, fees and payments as well as the total balance owed.

Then you will have 25 days to decide how much of the owed amount you will pay - only the minimal monthly payment equal to 3.2% of the owed amount (but at least CZK 200), a higher amount, or even the entire balance owed at once.

There are five possible ways to make the payment:

Setting up a standing direct debit for the minimum monthly payment - in just two easy steps:
- Call the CitiPhone line at 233 062 222 and tell us the number of your checking account from which you would like to have your payment deducted
- Contact the bank where you have a checking account and give your consent to the direct debit for the beneficiary Citibank Europe plc, organizační složka, account number: 8444444100/2600.
Bank transfer from your checking account with any bank in the Czech Republic. The account number and variable symbol are listed in your statement.
Via Citibank Online Internet Banking or the CitiPhone line if you have a Citibank account.
Postal order.
Payment in cash at any of our branches. This service is subject to charges in accordance with the Pricelist.

If you set up a standing direct debit, we will collect the amount roughly four days before the due date, and you needn't worry about it and will avoid any potential late payment penalties.

How to manage your credit card

You may occasionally need to talk to your bank, to for example discuss discrepancies in the statement, obtain a copy of the statement, change your address, or just to check your current balance.

You may contact one of the bank's branches or use other channels, predominantly phone banking or online banking. In exceptional cases, the bank may ask for a written request for some complicated steps.

To use phone banking, you will always need a password, PIN, or other form of security. You must have these passwords or codes on you whenever you contact your bank. This will help you save your time. You may usually choose whether you want to deal with your request independently using the automated voice system (ideal for simple tasks such as checking your balance), or with a banker - for more complex issues, such as changing your contact information or disputing a transaction.

Online banking is also secured - various passwords, PINs, codes sent via SMS, or the generators of access codes (calculators).

Tip: How it works at Citibank

You may contact Citibank at any time at 233 062 222. What's more, phone banking via CitiPhone is free of charge as a service associated with your credit card.

Access to Citibank's online banking is secured by an authentication calculator, which uses the latest encryption technologies. It is one of the most reliable methods of protecting your finances.

Change in contact information

Card validity and renewal

Credit cards are usually valid for two or three years from the date of issuance.

This means that at the end of this period, the bank will automatically issue a new credit card. The bank will either mail the card to you or invite you to come and pick it up at a bank branch. Sign the card immediately upon receipt.

If your card is mailed to you, you will probably have to reactivate it. You may then start using it right away.

Always discard the old card by cutting through the magnetic stripe. If required by your bank, send the discarded card back to the bank.

If your card stops working for whatever reason (e.g., wear and tear), contact your bank via one of the service channels (see How to manage your card) to have a new one issued. Such a re-issuance is usually subject to a fee.

Tip: How it works at Citibank

Citibank always re-issues your existing credit card free of charge (in case of malfunction, loss, or theft). Just call CitiPhone 233 062 222.

Citi credit cards are valid for three years. After the card has expired, we will automatically send your new credit card to the address specified in the application. Inactive credit cards are sent by regular mail. Before the first use, you must call us to activate them.

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