A retail card is the same thing as a store card: a credit card you can only use at a certain retailer or group of retailers. Most retail cards have $0 annual fees, and many give 1% to 5%+ back in rewards for shopping at the stores they’re affiliated with. Some retail credit cards also offer 0% deferred-interest financing on eligible purchases.
Retail cards are pretty easy to get, usually requiring only fair credit (640+ credit score) for approval. They can help you build credit just as well as any other credit card because they report information to the major credit bureaus each month. But there are a number of things you should be aware of before applying.
Here’s How Retail Cards Work:
A retail card is the same as a store card. It’s a card you can only use at a certain retailer. Or, you may be able to use it at several stores owned by the same parent company.
A retail card is different from a co-branded card. A co-branded card is affiliated with and earns rewards at a certain retailer, but you can use the card anywhere.
Retail cards may offer rewards in the form of cash back, points or discounts on purchases. But some retail cards offer no rewards at all.
You will commonly get 0% deferred interest on a retail card. You have a set period where you pay no interest. At the end of that period, if your entire balance is paid off, you pay nothing. Otherwise, you owe all those months of interest at the normal interest rate.
Retail cards usually require fair credit (640+ score) for approval. A co-branded card that you can use anywhere usually requires good credit (700+ score).
Retail cards may give you other perks like free shipping or access to exclusive sales.
Most retail cards have no annual fee.
You may be able to check if you are pre-approved for a retail card. You could get a pop-up to check while shopping online. In-store, a cashier might invite you. If you are pre-approved, your chances of approval for the card are not 100%, but they are very high.
A retail card may or may not be worthwhile. If it rewards you for shopping at a retailer you like and doesn’t charge an annual fee, you might want to consider applying. But if it only offers deferred interest, with no rewards, you can find better deals elsewhere.
Retail card is just another name for a store credit card. And that, as you may know, is simply a card that can only be used to make purchases from a single retailer or group of related retailers.
Retail credit cards tend to be available to people with fair credit or better and usually don’t charge annual fees. They are known for offering generous rewards, especially compared to non-retailer cards with similar approval requirements. These rewards come in the form of first-purchase discounts, “cash” back on purchases (redeemable for store credit), and special cardholder promotions.
Retail cards are notoriously bad for financing, though. Those with 0% rates typically use a dangerous feature called deferred interest, and the average regular APR is a lofty 22%, according to WalletHub research.
Store credit cards can help build credit, if you use the card wisely. Store credit cards report your payment history to the credit bureaus the same as a regular consumer credit card. If you make timely payments for more than the minimum due, and stay within your credit limit, a store credit card can go a long way in building, or even rebuilding your credit.… read full answer
A store credit card is a card offered by a retailer. It’s not to be confused with a charge card, in that a store credit card does not require you to pay off the entire balance every month. Store credit cards are also known as closed-loop cards, which means it can be used only for purchases within the store, its website, or affiliated stores. Retailers may also offer open-loop, or co-branded store cards. They’re store cards, but they’re on a credit card network such as Visa and Mastercard, and can be used anywhere the network’s cards are accepted.
You can use a store credit card to help build credit because they’re generally easier to get. Most store credit cards require a minimum fair credit score to have a chance of being approved. The drawback is that you’ll likely start out with a higher interest rate and a lower credit limit than you would with a co-branded credit card. Co-branded store cards also come with stricter approval requirements.
Where you can run into trouble with a store credit card is the temptation to overspend. Your favorite retailer may bombard you with promotional offers, discounts and sales announcements. It’s pretty easy to make additional purchases in the store, or online, thinking your sales item purchases will make up the difference.
In the end, you’ll end up canceling out any discounts and burning up most of your credit limit. That doesn’t bode well for your utilization, which should be at less than 30% of your available credit. And then there’s the interest that will be tacked on if you have to carry a balance to the next month.
Speaking of interest, be wary of any 0% promotional offers, particularly for large purchases. Unlike a 0% APR you’ll find on some regular credit cards, store cards operate on deferred interest. If you don’t pay off the balance by the end of the promotional period, you’ll be charged all the interest accrued on the original purchase price.
A store card has limited use compared to a regular credit card. Store cards can only be used for purchases from a specific store or group of stores. Regular credit cards can be used at any merchant that accepts cards from their network – American Express, Discover, Mastercard or Visa. Many stores also offer cards that are … read full answerco-branded with a major credit card network. These cards work the same way as a regular credit card but have some store-specific benefits.
Regular credit cards and co-branded cards tend to have stricter requirements for approval than store credit cards. Most store cards require only fair credit (640-649 credit score) to be approved, whereas co-branded cards generally require good credit (700-749). Other non-store credit cards are available to people with all kinds of credit, from bad to excellent.
Those are the most obvious differences between a store card and a credit card. But there are others. For example, store cards have higher regular APRs than general-purpose credit cards, on average. If you carry a balance, the store card’s higher APR may cancel out any discounts or rewards earned on store purchases.
In addition, store cards with “0% intro APRs” typically use deferred interest. This means if you don’t pay the entire balance before the introductory period ends, you’ll be charged interest all the way back to the original purchase balance. Regular credit cards with 0% APRs only charge interest on any unpaid balance remaining after the promotion ends.
Ultimately, the differences between store cards and credit cards favor credit cards, and for good reason. Store cards can help people with fair credit improve their score, while helping anyone eligible for approval save money on purchases at popular stores. But their use is limited. Traditional credit cards are better if you plan to use the card for everyday spending. You’ll reap a lot more value because you can use the card at far more places. The same is true for co-branded cards affiliated with a particular store, though their rewards for purchases unrelated to that store usually are not as good.
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