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Credit Card Guide

Card Types Explained

There's credit cards available from a wide selection of providers these days. Obviously from the banks, but there are now also an array of companies specialising purely in credit cards, or including them as an add-on to their existing business. It is now common for the major shops to offer own brand credit cards as well, so you are sure to be spoilt for choice when it comes to shopping rewards or special offers to entice you to apply.

Standard Card
Generally issued by a bank or finance specialist, they will decide a credit limit that they are happy to extend to you based on your credit score, with which to buy goods, products, services, etc. You can also take money out of a cash machine, which is generally charged at a slightly different rate and may have a fee attached to it.

At the end of each month they will send you a statement detailing your purchases, what the minimum amount repayable will be to them, and the approximate interest charges that will be applied if you only make that minimum payment. Some of these standard cards have special features such as low interest or cheap balance transfers, but always check if there are hidden fees attached anywhere, as well as seeing what benefits you are not getting (such as rewards) by having a low interest credit card.

Rewards Card
This type of credit card often has a fairly standard interest percentage but compensates by offering the customer various rewards, these could be shopping points, airmiles, even cashback deals in certain circumstances. So it's always worth comparing the rewards and special offers attached to each card first before applying. One rewards card may not be perfect for you, but another might cover all the rewards that fit in with your lifestyle just perfectly. Alway compare credit card offers.

Store Card
Normally promoted in-store at your favourite shops, and attaching special rewards such as an interest-free period on purchases made in-store, cash vouchers, additional shopping points, free gifts, or other incentives in order to get you to sign up. Certain store cards have been in the press for having unusually high interest costs, which is why it is important to ensure you read their terms and conditions and make sure you are happy with them before signing up to a card. Very often such cards are ideal for people looking to maximise their shopping benefits and only use the card specifically with that given store.

Charge Card
This type of card generally has a higher limit, but requires the full balance normally to be paid off at the end of each month. Such a card is great for those people who can afford to pay off the card in full each month and like to charge everything to just one place, but those who cannot settle in full can often be heavily penalised by the credit card provider.

Sports Card
A popular choice for all the sports fans out there. Various sports clubs now have their very own credit cards, that fans can apply for and receive various club-based benefits and incentives. Ultimately this type of card is more about the following that being loaded with perks, but in such a competitive industry loyalty is truly priceless.

Debit Card
This type of card is very commonplace and is generally linked directly into your bank account. The debit card allows money to be debited from a given bank account straight away, rather than putting it on credit and waiting to pay it off at the end of the month. There are also new debit cards on the market that are prepaid - such cards are similar to credit and debit cards but are pre-loaded with funds you add to them. The pre-paid card generally doesn't require any credit checks or bank accounts which could be helpgul for those who have very poor credit ratings.

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