Today, credit card has become a must-have accessory to meet day to day needs and to meet operational requirement. There are uncountable credit cards available in the market, and choosing the right one is very important. It is used to make different types of purchases for personal as well as business usage. Before purchasing a credit card, make sure to read all the terms and conditions. Today we are going to talk about the types of credit cards, and then it will become easy for you to make the right choice.
Let’s have a glimpse of different types of credit cards and what it has stored for you:
Standard Credit Card
The standard credit card is also known as plain-vanilla credit card as it offers no rewards, and its terms are pretty much easy to use. The card won’t provide any additional perks and advantages as compared to other types of credit cards. Here the cardholder will be given a small credit limit based on their income with the time limit. Generally, people have questions in mind, like which of the following is not a common credit card fee? Options are the Payday loan, minimum payment fee, and the answer is the minimum payment fee.
Secured Credit Card
Those individuals who do not have a good credit history can go for a secured credit card. Here the individual has to submit an equal amount of money that of the credit limit. Here the deposit amount acts as a security against the card holder. If you pay cash on time for a few consecutively months, then the bank may return the deposited money.
No Yearly Fee Credit Card
As the name suggests, there will be no annual fee on this type of credit card. It is one of the basic credit cards with the limited use of the card and very few benefits attached to it. This type of credit card is mainly useful for those who have limited usage or limited income.
Low-interest Credit Card
A low-interest credit card is a card that has a lower rate of interest as compared to other credit cards of the same category. However, the balance transfer credit card has a low introductory rate.
Balance Transfer Credit Card
Balance Transfer credit card comes with the ability to transfer the balance from one to another card. This card is a great way to escape from a high rate of interest on an existing card. The interest rate varies from company to company and transaction to transactions. The lower the interest rate, the more attractive the card will be. Some company offers an interest rate of 0% to grab more customers in the company’s account.
Rewards Credit Card
As the name indicates, Rewards Credit Card is a kind of card that offers some type of reward for every money spent or every transaction done. Every bank has a predefined set of rules for the reward points for specific transactions like grocery shopping, utility bills payment, online bank payments, and lots more.
Cashback Credit card
Some companies want to hold the customers for a longer period, the cashback credit card is a boon. In such types of credit cards, the cardholder will be reward with the cashback whenever they do the transaction with this credit card. Here the bank can mention cashback on a particular kind of transaction, for instance, 5% cashback on the minimum fuel transaction.
Travel Credit card
Travel credit card is meant for those who are a frequent traveller as they can reap several benefits which might not be available on other types of credit cards. One can be benefited from favourable currency rates, travel insurance, acceptance across the globe, air ticket benefits, hotel booking benefits, access to airport lounges, and so on.
Entertainment Credit card
If you are the person who frequently spends on entertainment-related things, then Entertainment Credit card is exclusively meant for you. These cards have amazing offers for movies, shopping, dining, concert tickets, games, and lots more. Here the cardholder will be given a large discount or cashback. Isn’t it an amazing option to keep oneself motivated for entertainment based on cashback or discount.
Student Credit Cards
Students’ credit cards are specially designed for students with a basic understanding of credit with low or no credit history. Compared to other types of credit types, the approval process for a student credit card is faster. The additional advantages of these cards include low-interest rates and other additional perks. Generally, this type of credit card is given to the university going students as they are mature enough to handle the finance on their own.
In the prepaid card, one needs to deposit the money before using it. For every transaction, money is deducted from the account. On this type of card, there are minimum or finance charges. They are basically more likely to debit card but unlike a debit card, they are connected to account. Many people prefer the prepaid card to keep the expenses within the decided budget.
Business Credit Card
Just as the name indicates, the business credit card is specially meant for business usage. This card provides the businessman with the opportunity to run the business smoothly, even during the financial crisis and recession period. Also, to get a best business credit cards, personal credit history has a major influence on the decision of approval or disapproval.
Co-branded Credit Card
Two parties support a Co-brand credit card, one party is a bank, and another is a retailer. The map the logo of both parties i.e., bank and retailer. This is an essential card for the business point of view as the holder of this card gets special privileges as compared to others. Generally, airlines, departmental stores go for the option of a co-branded strategy for the promotion of business.
Time to Choose the Best
A credit card is of great help as long as you can manage it carefully with responsibility. There are different types of credit cards, and after knowing about the types, you can wisely choose the best for you and your business. It is advisable to make the best use of it as it can prove to be risky to handle. FinanceShed is the station to solve all your financial queries and worries, so coming here.