What are credit cards?

What are standard credit cards?

Standard credit cards are the most typical type of credit cards. These are unsecured credit cards that are readily available from most banks and financial groups. These types of cards vary in how the annual percentage rate (APR) is offered or calculated. Examples of standard credit cards are balance transfer credit cards and low interest cards.

What are low interest credit cards? 

Low Interest Credit Cards offer either a low introductory APR that changes to a higher rate after a certain period of time or a low fixed rate APR. For example, you may get an introductory APR chase credit card with an interest rate of 5% for the first six months and 10% thereafter. Then, for the first six months, any purchases or balances you carry will be only charged a 5% annual interest rate. However, any new purchases or balances that carry over after the six-month period will now be subject to a 10% APR.

Many people take advantage introductory APRs to make larger purchases, so that they can take several months to pay them off. Low APR Credit Cards can help save consumers a lot of money on interest charges. However, be sure to read all the terms and conditions of the reduced introductory rate, so that you will not be penalized by fees or accumulated interest.

What are prepaid credit cards?

Prepaid cards are, in fact, not credit cards at all BUT rather are used just like credit cards, wherever credit cards are accepted. The advantages of prepaid cards is that there are no finance charges and they help you avoid debt, in that all purchases are paid for beforehand. With prepaid cards you determine the credit line. Generally speaking, a cardholder’s credit line depends on how much money is transfer to the card. Therefore, there is little risk of running up credit card debt and your budget is easier to handle as you are not at risk of running over your limit.