What Are The 4 Types Of Credit Cards? 

What Are The 4 Types Of Credit Cards? 

 

Credit cards are useful to help build credit and earn rewards, but if used improperly they can damage your financial success. Careless use of credit cards can damage your credit score and leave you unable to make repayments. However, if you can make your payments on time and stick to your budget, credit cards can boost your credit score. Read on to get detailed information about different types of credit cards. See over here for the best credit card offers in UAE.

Secured credit cards

A secured credit card is a credit card that requires a security deposit from you before you can use it. This deposit protects the lender if you fail to pay your debt. The best-secured credit cards offer perks that help build your credit. Some offer credit education tools, flexible payment schedules, and reporting activity to all three credit bureaus. The best ones also offer substantial rewards and unique upgrade opportunities.

Standard credit cards

Standard credit cards offer a revolving line of credit that allows users to make purchases up to a pre-determined limit. Credit is deducted when the purchases are made and then made available again at the end of the month. Generally, interest is not charged if the cardholder pays the entire balance by the due date, but a minimum payment is required each month. Often, this minimum payment is 1% to 3% of the balance. Making the minimum payment on time is critical to avoid late-payment penalties.

Student credit cards

Student credit cards are specifically designed for people with a limited credit history or applying for their first credit card. To qualify, you must be at least eighteen, enrolled in college, and have some income. Many issuers require that you have a cosigner or someone with a good credit history who will guarantee repayment of the balance if you fail to make payments.

Revolving credit cards

Revolving credit cards are very different from normal credit cards. With a revolving credit card, you only make payments every month, and you may need more than those payments to cover the entire debt and interest. The amount that you owe regularly grows with interest. Hence, revolving credit cards are considered usurious products.

Open-loop cards

Open-loop credit cards allow you to earn points toward your favorite stores. Some retail brands offer proprietary store cards that they offer to customers. Others partner with credit card network processors to create co-branded cards. These co-branded cards may be easier to qualify for and tend to have lower limits than open-loop credit cards.

Evelyn

Evelyn