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A
credit card
is a plastic
card bearing
an account
number assigned
to a cardholder
with a credit
limit that can
be used to purchase
goods and services
and to obtain
cash disbursements
on credit, for
which a cardholder
is subsequently
billed by an
issuer for repayment
of the credit
extended at
once or on an
installment
basis.
A bank-issued
card that allows
consumers to
purchase goods
or services
from a merchant
on credit. A
payment card
issued for purchasing
goods, services
and obtaining
cash against
a line of
credit established
by the issuer
of the card.
Bills are usually
sent monthly
and you can
either choose
to pay a minimum
payment or pay
in full, eg.
Barclaycard
/ VISA /
MasterCard.
Types of Credit
Cards
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Standard
Credit Cards
Standard
credit cards
are the
most typical
type of
credit cards.
These are
unsecured
credit cards
that are
readily
available
from most
banks and
financial
groups.
These types
of cards
vary in
how the
annual
percentage
rate
(APR) is
offered
or calculated.
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Balance Transfer
Credit Cards
Balance Transfer
Credit Cards are
designed to allow
consumers to transfer
a higher interest
credit card balance
onto a credit card
with a
lower interest rate,
thus saving them
money in interest
charges.
-
Low Interest
Credit Cards
Low Interest Credit
Cards offer either
a low introductory
APR that changes
to a higher rate
after a certain
period of time or
a low fixed rate
APR.
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Airline Mile
Credit Cards
Put simply, airline
mile credit cards
or frequent flyer
credit cards give
you airline miles
credits (or
frequent flyer miles)
whenever you use
your card. Typically,
you as the cardholder
accumulate "points"
based on the dollar
amount of your credit
card purchases over
a period of time.
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Cash Back Credit
Cards
Cash back credit
cards give you cash
rewards for making
purchases with the
card. The more the
card is used, the
more cash rewards
you usually get.
Most cash back rates
are around 1% of
your total purchases,
excluding interest
and finance charges.
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Secured Credit
Cards
Secured credit cards
require collateral
for approval. With
secured credit cards,
a security deposit
of a predetermined
amount is needed
in order to secure
the credit card.
Generally, the security
deposit needs
to be of equal or
greater value to
the credit amount.
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Prepaid Credit
Cards
Prepaid cards are,
in fact, not credit
cards at all But
rather are used
just like credit
cards, wherever
credit cards are
accepted. The advantages
of prepaid cards
is that there are
no finance charges
and they help you
avoid debt, in that
all purchases are
paid for beforehand.
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Specialty Credit
Cards
Specialty credit
cards are for individuals
with unique and
special needs for
their credit use.
Examples of these
types of cardholders
include business
users and students.
These credit card
programs are designed
specifically to
meet the needs of
these particular
groups.
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Business Credit
Cards
Business credit
cards are available
for business owners
and executives and
have many of the
same features as
traditional credit
cards: low introductory
rates, cash back
rewards, airline
rewards, etc. However,
business credit
cards can also have
many additional
benefits in comparison
to traditional credit
cards.
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Student Credit
Cards
Students generally
have little or no
credit history.
Because of this
quandary,
students may often
find it difficult
to get approved
for a traditional
credit card. Luckily,
student credit cards
do exist. This type
of credit card is
set up to help students
build up the
credit history
that most of them
don't already have.
Student credit cards
are often scaled
back in terms of
rewards, features
and other benefits,
but they can still
be a valuable commodity.
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Credit
Cards
