How Do Credit Cards Work?

Credit cards are issued to the person who is eligible to repay the amount he is withdrawing on his card and the process starts with the first meeting you have with your bank or agent to issue the card.
      
When you approach a bank or the agent of the bank approaches you for the issuance of the credit card he first enquires about your financial status so that he can determine your repaying capacity. After making sure that you can make the payment of the card they will issue you the card which you can use.
      
When you are using the card in a shop you will find that they are swiping the card in a particular machine and the amount is deducted from your account to that of the shop owner's. The machine in which he is swiping the card is connected with the server of the bank through a satellite and thus they keep track of your transaction.