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What Are The Popular Credit Card Types That Are Available?

Every consumer's financial requirements are different. Thus there are a variety of credit cards in the market to cater to different needs of the customers. Before you make an application for credit cards, you must get familiar with multiple forms of credit cards in order to ensure that you are selecting the ideal one.

• Standard or regular credit cards: This is the most commonly used credit card which permits you to maintain some revolving balance till a specified credit limit. You use up the credit when you buy something with the card. Again the credit is given back to you once you have made the payment. A form of finance charge becomes applicable for outstanding balances towards the later half of every month. These types of credit cards come with minimum payment structures whereby the card user needs to pay the minimum amount by a due date for avoiding penalties related to late payment.

• Premium credit cards: These credit cards come with benefits and incentives which go beyond those offered by the regular credit cards. Certain examples are Gold and Platinum credit cards. These cards provide cash back, travel upgrades, reward points and similar other kinds of rewards for cardholders. Premium cards generally come with higher fees. They also have certain minimum income as well as credit score eligibility criteria.

Both the standard as well as premium credit cards contain specific forms of credit cards. Some of them are student credit cards, travel cards, and zero percent rate of interest cards.

• Charge cards: These kinds of credit cards have no credit limit. The balance on charge cards has to be paid fully every month. Charge cards usually do not levy finance charges or any minimum payment because the balance amount calls for payment in full. Delay in payments can result in imposition of a fee as well as charge restrictions, and even card cancellation which is dependent on your initial card agreement.

• Limited purpose credit cards: These forms of credit cards may be utilized specifically at certain locations. Limited purpose credit cards are utilized in the same manner as normal credit cards that come with minimum payment as well as finance charge. Gas credit cards and store credit cards are certain examples of the limited purpose cards.

• Secured credit cards: Secured credit cards generally are for those who have poor credit rating or with no credit history. These cards need a certain amount of security deposit and the credit limit on these cards are set based on this deposit amount.

• Prepaid credit cards: This form of credit card requires money to be loaded on the card by the cardholder prior to it being used. Prepaid credit cards have no finance charges and minimum payments because the outstanding balance is made to be withdrawn from amount which is already deposited. The credit limit is not renewed until additional amount has been loaded.

• Business credit cards: These are specifically designed for business purpose. Business owners use these credit cards to keep personal and business transactions separate. There are business charge cards and standard business credit cards available.