A credit card from a department store can be a good option for some consumers. There are limitations to this card. These limitations include co-branding, cash-back rewards, interest-free financing and cash-back. You should read all terms and conditions before you apply for a credit card at a department store.
Limitations for a departmental store credit card
A department store credit card offers many advantages to loyal shoppers. These cards are a great option because you can often get big discounts and promotional interest rates. If you do not plan on buying frequent items from the same store, however, a general rewards or low-interest creditcard may be a better choice.
The cards do have some limitations that younger consumers may not be aware of. You may not be able to pay for your purchases on time, and your payments will be higher. You may have to pay higher interest rates or fees in some cases. This could be a disadvantage to those who don't have good credit ratings.
Cash-back incentives
Shoppers can earn valuable rewards with a department store credit cards. Even though these purchases aren't as frequent as others, they can earn you hundreds of dollars in cashback each year. You have a variety of reward options, from special store discounts to rewards on everyday purchases.
Before applying for a cash-back rewards card, make sure you understand your spending habits. This will allow you to choose the right card. Different cards have different categories, so be sure to plan your purchases around the rotating categories. You should also be aware of the eligibility and deadlines for each type reward.
Interest-free financing
A store credit card is a great way to stick to your budget and not go overboard. Paying your bills on time is a must, as high interest rates are likely to follow. Avoid this by paying off your balance in full before the interest-free period expires.
Some store cards have special financing terms that will waive interest for a specified time. This is sometimes called "deferred Interest" and it applies to balances that are paid within a specified time period. After the promotional period ends, interest will be retroactively charged. However, general-purpose purchases made with 0% APR credit cards typically don't have retroactive interest.
There are limitations to co-branded cards
You can shop wherever the name of the department store is printed on co-branded department store credit card. These cards, also known "open loop" cards, are issued from companies that have partnered with networks like MasterCard Visa American Express. These cards offer higher credit standards, and you can make purchases at stores other than your local store. They have certain limitations.
Co-branded credit cards can be a great way to reward yourself for every day purchases. You can redeem points for a discount at your favorite retailer. These points can also be used to get significant discounts at your favorite retailers. These co-branded cards do have limitations.