Plastic Money is the term used to indicate Credit cards & Debit cards. Before the advent of Credit cards and Debit cards a major portion of the business transactions were carried on through cash.
Even though there existed a very strong banking industry the business was more dependent on cash transactions than the banking channel due to the lack of information with regard to the credit worthiness o the customers and the inherent delay in collections.
This posed a major problem for both the business community as well as the individuals. The plight of the travellers was still worse; they were forced to carry large quantities of cash wherever they went. Carrying cash in itself was a great threat than anything else. Thanks to the development in technology and computerisation, with the use of the smart cards like Credit cards & Debit a is the need to carry cash is significant!
reduced. You can shop whenever you want and you can make the payment instantly either with a Credit card or a Debit card. Since the cash is replaced by plastic cards (whether Credit card or Debit card) it is called plastic money.
The plastic money brings with it various advantages like availing a credit facility whenever you want and paying for your purchases or making other utility payments without actually exchanging money or visiting the bank.