Types of Credit Cards
Credit cards are an ingrained part of most peoples lives.
There are three main types of credit cards:
- Travel and entertainment cards - such as American
Express or Diners Card. These credit cards are liberal on spending
limits but must be paid in full at the end of the month. There
are no interest charges if paid in full, however there are semi-annual
account fees.
- Bank cards - such as Master Cards, Visa, GM,
and Ford cards. Each card is sponsored by a bank, which defines
the credit line, [spending limits] and the terms and conditions
of use. Banks typically offer the choice to either pay the balance
in full with no interest at the end of each month, or pay a minimum
or part of the balance with a finance charge.
- Retail store cards - such as Sears, J.C. Penney,
Shell or Mobil. Retail credit cards provided by fuel companies
are also known as fuel cards. These retail cards are only accepted
in specified countries. They typically have no annual fees and
vary greatly in the terms and conditions for the cards.
Different types of credit cards offer different options to meet
different needs. Some credit cards are geared more toward individual
consumers, whilst others are set up to work best for small or large
businesses.
Next: Getting
Your First Credit Card
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