A department store credit card can be a good choice for some customers. This type of card has its limitations. The limitations include cash-back rewards, interest free financing, and cobranding. Make sure you read all the terms and condition before applying for a departmental store credit card.
A department store credit card has limitations
The benefits of a department store card credit card are many for loyal shoppers. These cards offer great discounts and interest rates, so they are worth considering. You might prefer a general rewards credit card with low interest rates or no interest if you don’t intend to frequent shop at the same place.
These cards come with limitations that may be unfamiliar to young consumers. It is possible that you will not be able or able to make your payments on time. In some cases you may be required to pay high fees and interest rates. This may be a disadvantage for those who do not have good credit history.
Cash-back rewards
A department store credit is a great way to get valuable rewards on your purchases. Though these purchases may not be as frequent as other types of purchases, they add up to hundreds of dollars in cash back annually. There are many reward options, including rewards for everyday shopping and special store discounts.
Be sure to understand your spending habits before you apply for a cash back rewards card. This will help to determine the card that is best for you. Different cards have different categories. Be sure to plan your purchases around rotating categories. Be sure to check the eligibility requirements and deadlines for each type of reward.
Interest-free financing
A store credit card helps you to stay within your budget and avoid spending too much. But, you need to be aware that you can get charged high interest rates if your payments are not made on time. You may want to avoid this problem by paying off your balance before the interest-free period expires.
Some store cards have special financing terms that will waive interest for a specified time. The interest-free period, also known as "deferred interests", applies only to balances paid within the specified period. Retroactive interest will be added after the promotional period has expired. However, general-purpose purchases made with 0% APR credit cards typically don't have retroactive interest.
Co-branded cards are subject to certain limitations
Co-branded department store credit cards allow you to shop anywhere the store's name is on the card. These cards, also known to be "open-loop" credit cards, can be issued by companies with partnerships with networks such a MasterCard, Visa, or American Express. These cards offer higher credit standards, and you can make purchases at stores other than your local store. They have certain limitations.
It's a great way reward yourself for all your purchases. You can accumulate points that you can use to get a discount at your favourite retailers. You may also be eligible for significant discounts on travel. These co-branded cards do have limitations.