Store credit cards have observed an upsurge in popularity despite certain experts pointing out that they hurt your credit score in reality. So, are they really worth your consideration?
What are Store Credit Cards?
Store Credit cards are credit cards that unsecured and associated with any one retailer and issued to people who have good credit scores. Of late, it has become a way for people build their credit scores but they also give good initial bonuses and avail exciting offers on financing options.
What makes having a Store Credit Card not-so-attractive?
Many customers are enticed to sign up for store branded credit cards in exchange of a huge discount or almost 0% for the first purchase with the card or offer financing for their big purchase, which they find it irresistible to decline.
However there is a catch to this, with further purchases you will discover that these cards have an interest rate that is higher than that other credit cards charge, some going as high as 25%. Some also come with lower credit limits for the high interest rates for these cards. It could also affect your credit score in some cases.
If you were a customer who has a sterling credit and a long positive history of credit, then availing these cards won’t affect your credit score so much.
What could having a Store Credit Card really get you?
One advantage you get with having a Store Credit Card is that you would be able to get a lot of promotional offers, great discounts for big ticket purchases, exclusive coupons and discounts to the members and other value added benefits to its members who are frequent shoppers at their stores. In most of the cases it enables the store to get frequent purchases because of the credit card that is associated with the store and the customers also benefit because of the discounts and offers. It is a great service if the Store Credit Cards are used wisely by the buyers.
One big advantage of having a card like this is that such cards are offered instantaneously and often times without background checking of the credit history, thereby making this a very attractive and reliable method of creating a credit score and a history for those customers who have none and want to create a credit history and score for themselves. It may help establish a credit score faster than what it might ideally take one to get it with a secured credit card.
Some experts say that these credit cards are nothing but useless as the same discounts can be availed with coupons offered at the stores, and some experts opine that some store credit cards do offer an advantage. However it is best to compare the cards, coupons and regular discount offers that each store has to offer you before you decide to get one. For more information regarding store cards, visit http://usefulfinance.com/.