Types of Credit Cards

Platinum & Gold Credit Card

For those with a good credit rating and a yearly salary over 25,000 thousand pounds, platinum & gold cards will be offered by credit card issuers.

These credit cards have a higher limit than the average credit card, daily can withdraw larger amounts of cash, also get extras from this type of credit card. Below are a few additional things which you get when applying for a Platinum or gold credit card:

• Travel insurance
• Household goods extended warranties
• Medical insurance
• Card protection

The Store Card

Store cards are restricted to a specific store and can be used for that company only. You cannot use a Boots store card in a Sainsburys supermarket.

The store card interest rate is normally higher than a standard credit card. These types of store cards should not be taken out unless you are settling the full balance at the end of each month.

The Donation Card

Every time you use your card, issuers fund a limited amount to donation at no extra cost. Credit card issuers will fund a percentage to firms such as Oxfam, Football Clubs, Universities and many other organisations that need some kind of financial help.

A survey also known as NOP showed that 76% of people who had store cards did not know how much interest they were being charged. Figures also showed that only one in three repaid their monthly balance.

If a shop or store does not take credit card payments, then using a store card can be useful. You can also benefit from discounts made available only to store cardholders, which a regular credit card does not offer.

The Charge Card

These types of cards work only with an account were withdrawals can be made to buy an item. The balance remaining should be paid every month or you could suffer severe late penalty charges.

These types of cards are very similar to a standard credit card and a yearly fee of £100 is usually paid.

Diners Club and American Express are good charge cards. These two companies are individually set-up, as charge cards are normally offered by banks only to their customers.

With a charge card you will benefit from the following extras:

• Insurance
• Air miles
• Reward points scheme

For those who are rich and wealthy, the American Express Centurion Black Card is offered. With this type of card you have an unlimited credit limit, however the remaining balance must be paid off in full every month.

The Company Cards

Many Companies are offered company cards to keep on top of company expenses. Selected members within the company will be able to have this type of charge card and the monthly statements will be sent to the company and the cardholder.

The card is connected to a current account so payments can be processed each month automatically.