Types of credit cards

Posted by Nick Niesen on October 29th, 2010

Different types of credit cards are:-

Debit Cards

A debit card is not exactly a credit card. When your debit card is swapped, it checks with your account whether or not it has sufficient balance to make the transaction. If yes then money is deducted from your account. Although a debit card doesn?t give you the choice of paying later but it enables you to shop without carrying hard cash. Also, you can use this card at ATMs as well.

Charge Cards

Charge cards fall into the category of credit cards, but the only difference is that you have to clear the entire balance at the end of each month. Since it does not allow you to carry forward your balance, it gives you very high spending limit or may be no limit at all.

Store Cards

These are cards issued by superstores and malls to use them within their premises. You get bonuses like discounts and points that can be redeemed later.

Affinity Cards

These cards are offered by banks in association with airlines, car companies, and hotels. Using these cards get you flying miles and points that can be stored and redeemed later.

Unsecured Credit Cards/Revolving Cards

These cards allow you to pay a minimum due of 2 to 4 % and carry forward the remaining balance to the next month. If you clear the entire balance and later you make some purchases then you won?t be charged any interest on these purchases till the next billing cycle begins. This period of non-interest is called your grace period. If you have a balance to pay, then all subsequent purchases attract the interest rate as per the APR (annual percentage rate.)

Secured Credit Card

This card asks you to have a savings account with specific balance in it. This serves as collateral in case of default in payments. These are a good way to repair bad credit reports. Make sure the issuer reports to credit bureaus and does not mention the secured aspect. The associated fees should also be looked into.

Consolidate Credit Card

If you have more than one credit card with balance, you can combine them into a single consolidated credit card. The card provider pays off all the balances on the previous cards, and charges fees and interests for doing so. These balances are then shifted to the new consolidated card. This is called credit card balance transfer.

For further details visit http://www.credit-card-universe.net">Credit Card Universe or http://www.credit-card-deal-maker.com">Credit Card Deal Maker

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Nick Niesen

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Nick Niesen
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