Types of Credit Cards

There are many types of credit cards which are used by different types of customers and account holders. Mostly business personnel use credit cards which are convenient in their use and which suit businessmen. Similarly students would use student credit cards and a layman will use general purpose cards. There are some most used types of credit cards. For example Interest Credit Cards are mostly used by businessmen and company CEOs because there is a charge of interest if credit card payment has not been annulled in time.

Another important and commonly used type of credit cards is those in which 0 APR (Annual Percentage Rate) is charged as its introductory price similarly cash cards are also used which are just like cash but in the form of plastic card. It is because the cash card holder has paid the cash price of that card and he can use it as cash now. In this card the annual percentage rate is always zero and it is used by millions of people around the globe.

There is another kind of credit cards which are called Payments Card. A payment card is one with which a person can make the payment of something and they are also widely used in the business field and in different areas of financing. American Express Credit Cards is another type of credit cards these American cards are used almost all over the world due to their world wide acceptability. And they are acceptable almost in every area of the world. In some types of credit card the interest rate is very low as compared to general interest rate applied in normal credit cards and these types of cards are called Low Credit Cards. Low rate credit card is mostly used by those who can’t bear the price of interest charge so it is a facility for them to use the low rate card for their convenience.

These are some major types of Credit Cards:-

  • Secured Credit Cards
  • Travel Credit Cards
  • Rewards Credit Cards
  • Bad Credit Credit Cards
  • Airline Credit Cards
  • Business Credit Cards
  • Cash Back Credit Cards
  • Instant Approval Credit Cards
  • Low Interest Credit Cards
  • Student Credit Cards

1. Secured Credit Cards:

Secured Card or Secured Credit Card is a sort of credit card in which the card is secured with some deposit by the card holder. In a general sense the credit card holder must deposit between the 100% to 200% amount of desired credit and in this way the credit card is secured. It is because after depositing an amount the chances of bad credit history become low as compared to unsecured credit cards hence credit card secured by using the deposit from the credit card holder.

These secured cards are used and provided by the card issuers due to the fact that if the credit card holder has a bad credit history or he makes an intentional attempt to delinquent credit cards secured against his fraud.

The secured credit card holder is expected to make the regular payment of its usage of cards and in most circumstances the card holders make the regular payments. So these secured credit cards help the credit card issuers and banks to get the payment in time as compared to the payments of unsecured credit card.

An account holder in some bank can make an application for the secured credit card and after the secured credit card application has been approved he can use his bank secured credit card now for different modes of payment up to the secured deposit which he has deposited in the bank. Similarly an application can also be submitted for unsecured credit card and after the approval of unsecured credit card application a person can use his unsecured credit card.

If a person does not make his due payments within 180 days then usually the rules of secured credit card apply and the bank or credit card issuer can freeze the account of the card holder. There is another type in which the card is not secured with any deposit but a guarantee has been given for the payment and that is called Guaranteed Unsecured Credit Cards and it is mostly used by the companies for their employees. These cards are also useful for those people who can’t make regular payments by using unsecured credit cards or unsecured credit card debt. In this way these cards are very helpful for these people also.

Most terms and conditions are described in the form at the time of issuing the secured credit card in the application form. And an account is opened after the signature on the agreement by the applicant. Secured cards are less expensive to those card holders who have bad credit history than unsecured cards.

2. Travel Credit Cards:

A travel card is like having cash with us everywhere and that cash is acceptable almost every part of world. And we don’t need to convert the cash after going to conventional money exchange centers. And travel credit cards are offered for this purpose to the travelers and tourists. They are easy to use and the tourist and traveler can also earn different types of points and rewards on these cards on every purchase. And afterwards he can use these travel rewards in his tour or he can take back these rewards in the shape of cash.

Hence a travel credit card also serves as travel reward card and a tourist or traveler can use this travel reward which he gets from different ways in his shopping and in air mile discounts. The best travel credit card which has travel credit is either travel MasterCard or Travel Visa cards because of the fact that American Express Travel credit card is not acceptable everywhere in the world.

Most ATM machines have the MasterCard and Visa Card logos so it is easy for the traveler to use these cards and get rewards if he’s using travel reward credit card. He can simply use these rewards later on in his journey to get points or to get discount.

There is another type of travel credit cards which are available for business personnel and executives of different companies to use them in their travel. And these cards have special features for such prestigious people around the world. These cards are well known by their name Travel Business Cards. And traveling while someone has these travel credit cards in his pocket is the best credit card travel or at least if not best than it is one of the best ways to use these cards.

Though express card which is backed by American Express Card system is not acceptable all over the world but it is acceptable in major parts of the world and in almost all free countries so it is not a bad choice even to use this card. But its acceptability is not as wide as Visa or Master Cards.

Many travel credit card providers also offer credit card travel insurance to their credit card holder however this insurance doesn’t apply to their cardholder when he has reached his destination but some credit card providers also give this facility and a travel credit card holder can find these types of card providers for a safer journey.

In this way travel credit cards work and there is another plus points in these travel credit cards and that is their acceptability in some major and famous money exchangers. This can help the traveler if he needs to have cash in liquid form. Then it is another opportunity for him to use his travel credit card because they are acceptable to currency exchangers so a traveler does not need to look around for the ATM machine in this case.

Source: Scribd.com