Many types of credit cards suit a variety of needs and preferences. Many credit cards help you earn rewards, save money on interest, get travel benefits, reward brand loyalty or build credit. Finding the right card often depends on how you plan to use credit cards and which ones you qualify for. When you’re comparing options, it can be helpful to understand how different types of cards work and who they’re best for.
1. Reward credit card –
Rewards credit cards offer points, miles, or cash back when you spend. Rewards credit cards are best for people who pay their statement balance in full and on time, so they don’t have to pay credit card interest. Many rewards cards are only available to people with good or better credit. Types of Credit Cards in the world
This type of credit card is best for:
- Earn rewards for your purchases
- Those who pay their full balance every month
cashback credit card- Some people like cash-back cards because they offer easy-to-understand value. Cash-back credit cards give you back a percentage of the money you spend on the card. Some cash-back cards pay cash back at a flat rate on all purchases, such as 2% back on every dollar spent on purchases. Or they may have bonus categories, such as 3% back on certain types of purchases while paying 1% on other purchases.
This type of credit card is best for
- People who want some money back on their everyday spending
- People who spend more in specific categories, like gas or dining
- People who want the benefit of earning rewards but don’t want to keep track of specific reward categories
2. Student credit card –
Student credit cards are specially made available to meet the financial needs of students. Students typically have little or no credit history, little or no income, and have specific spending habits. Some student credit cards may also offer additional cash back in categories where students spend more, such as restaurants and grocery stores. Other cards encourage good habits by offering bonuses for paying bills on time or getting good grades.
How Student Credit Cards Work : Student credit cards offer features and benefits for college students. They’re typically easy for students to get approved for but may require proof that you’re enrolled in a college or university. Student credit cards may have low credit limits, but often offer rewards and features designed with student spending in mind.
This type of credit card is best for:
- College students who want to establish or build credit while in college
- Students who don’t qualify for other credit cards
3. Business credit card –
Business credit cards allow small business owners to separate their purchases from their company expenses, while also receiving benefits, rewards or other special features that are specifically designed for business needs. Like personal credit cards, several types of small business credit cards offer different benefits. These include no-fee business cards, cash-back business cards, and 0% APR business credit cards.
How business cards work: Business credit cards are designed to meet the needs of businesses by providing business-specific features. These cards typically come with higher credit limits and employee card bonuses. These often include rewards categories that are tied to common business purchases, such as office supplies and travel.
This type of credit card is best for
- Small business owners who want to manage and track business expenses
- Business owners who want to manage employee expenses
4. Travel credit cards –
Travel credit cards offer rewards that you can use to pay for travel, such as airline tickets and hotels. These cards may also offer other travel-related benefits, such as travel insurance or priority service. Types of Credit Cards in the world
How travel cards work: Travel credit cards allow you to earn points or miles that can be redeemed for flights, hotel stays, car rentals and other travel-related expenses. These rewards may be transferable to other loyalty programs, depending on your card’s terms. You can generally earn rewards on all purchases, with travel-related purchases earning higher rewards.
In addition to earning rewards, many travel credit cards offer valuable travel benefits like airport lounge access, expedited security fee reimbursement, and travel insurance. These features enhance your travel experience and also help you save money.
This type of credit card is best for:
- People who travel frequently And want to earn points or miles on travel purchases
- People who can take advantage of travel benefits like access to airport lounges
5. Store credit card –
Some retailers offer co-branded store credit cards. People who shop frequently at particular retailers may want to maximize spending by opening a store credit card. Store credit cards often earn bonus points on money spent at certain stores or may give you discounts or special rewards. Some store credit cards can only be used for purchases at the store, while other store cards are part of a larger payment network, such as Visa or MasterCard, and can be used anywhere.
How store cards work-
Store credit cards are issued by retail stores and offer special rewards and benefits when you shop with that particular retailer. They may be easier to obtain than other types of cards. Types of Credit Cards in the world
This type of credit card is best for
- People who make frequent purchases at specific retailers
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