Why Are There So Many Types of Credit Cards?

credit cards

When you’re searching for a credit card, you’ll quickly discover there’s quite a few different ones to choose from. Each different type of credit card has its own uses, so how can you tell which one is right for you?

Here, we’ll look at the different types of credit cards available today and who they are best suited to.

Balance transfer cards

One of the leading types of credit cards you’ll come across is balance transfer cards. These are designed to allow you to move an existing credit card balance, onto the new card. They typically come with a set 0% interest free period, allowing you to save on interest, instead paying only the balance on the card.

These types of credit cards can be great for those struggling to get their existing credit card debt down. However, you will need to ensure you pay the balance off before the 0% deal runs out, otherwise you could end up paying more in interest than you would have done if you’d have stayed with your existing card supplier.

Reward credit cards

Looking to get something back for spending on your credit card? If so, a reward card could be an ideal choice. There are different types of reward cards, but the most popular tend to be cashback credit cards. These award you with a specific amount of cash back when you spend a set amount.  

Other types of reward cards include air miles and points. With airmiles cards you can save the miles up to gain free flights. With points credit cards, you earn points each time you spend, and they can be redeemed for cash, products and services.

Bad credit cards

If you have bad credit, a bad credit card is a great choice. They do tend to come with higher interest rates, but they’re easier to get if you have poor credit. They are designed to help you rebuild your credit rating. As you make small purchases and pay the balance off in full in each month, it slowly starts to build up your rating.

If you are interested in a bad credit card, it’s important to choose a reliable provider such as Ocean Credit Card.

Interest free credit cards

Finally, interest free credit cards are ideal for those looking to spend frequently on their cards. As the name suggests, you won’t need to pay interest on the goods that you purchase. However, the interest free period only runs for a set time, so you will need to make sure you pay off the purchases in full by the time the interest-free period runs out. Otherwise, you may end up paying higher interest rates than you would on a standard credit card.

As you can see, there are many different types of credit cards to choose from. In order to make sure you’re choosing the best one for you, it’s important to take into account your credit rating, existing credit card debt and how you’ll plan to use the card.


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