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Credit cards are the second most popular non-cash instrument in the United States and growing in popularity around the world. While initially introduced as primarily a credit instrument, today it has become an extremely popular payment instrument. Some financial observers doubted the viability of credit cards in their initial years and many issuers exited the business only to return later. However, today, most observers agree that credit cards offer unique benefits to consumers and merchants and profit opportunities to banks. In the first chapter, you will find a thorough bibliographic reference to the history and the term of credit cards. Continuing, you get introduced to a mere reference in the history smart cards, the form of the credit card and its basic functions. Afterwards, the various types of credit cards and the use of credit cards in ATMs are presented. Also, numbering and security of credit cards are mentioned with the paper. The last chapter of the paper refers to the advantages and disadvantages of credit cards against cardholders or clients and merchants.