Credit card types

How much does a store card really cost? How could you get a ‘0%’ credit card? What can you do if you have bad credit? We’ll make sure you know how to pick the right card, not just any card – including the benefits and drawbacks of each.

There are very few differences between Mastercard and Visa. These are the companies who provide credit cards that you can use throughout the world. Each credit card provider typically offers standard and premium cards such as gold and platinum. Standard credit cards are available to anyone over the age of 18 who fits the criteria. With most types of credit card you can settle the amount owing in full and without interest (on purchases) within a given period of time, or pay off a portion of the outstanding amount and carry the remaining balance forward with interest. Premium cards offer lower interest rates but are only available to those on higher incomes and may involve charges.

When you sign up to an affinity credit card, a certain amount will be donated to the organisation, and then a nominal amount for every transaction you make thereafter. Store cards are similar to credit cards, but are only valid for use in the shop they are affiliated with. They will usually give you a discount on your first purchase, but typically have high interest rates of around 30%, which make them an expensive form of borrowing. Charge cards are similar to credit cards and allow you to buy products on a period of interest free credit. However, the balance must be paid in full each month.

Cashback cards give you back a percentage of your spending. You usually receive this at the end of the year, so handy if you’ve splurged at Christmas. AirMiles cards work in a similar way by rewarding your spending with points towards free flights.