Secrets Behind A Reward Credit Card

If you are looking for information regarding some of the well-kept secrets of card issuers

, then you have come to the right place. Below we have enumerated three trade secrets that card companies keep from their loyal cardholders. These secrets are greatly associated with the reward credit card programs they offer to consumers. We believe that by knowing these things, you can guard yourself from the potential risks and pitfalls of using reward credit cards.

Three Reward Credit Card Secrets You Need to Know

1. Credit cards are the most common gateways for identity theft. It is almost impossible for cardholders to be sure that their credit information will not get compromised whenever they use their reward credit cards in making card transactions, either online or offline. Why? It is because scam artists and unscrupulous agencies are doing all their best to come up with mechanisms and schemes that will allow them to gain access to confidential information of consumers. They rely on advanced gadgets, malicious software and other machinations to rip off cardholders, especially those who use programs that offer credit card rewards.

And that's not all. Card issuers cannot also provide complete protection from identity theft and credit fraud. They can only guarantee limited liability in case your reward credit card gets lost or stolen. After all, this is an important provision of the new Credit CARD Act. But other than this, they cannot offer anything else. Thus, prior to your application for a reward credit card program, you better ask yourself this important question: Am I ready to face the risk of losing my credit identity to scam artists? Your answer to this question will guide you whether or not you will pursue your application for a special credit card account.

2. You pay more with a reward credit card. Programs that offer credit card rewards normally use point systems that will oblige you to spend a great deal of money just so you can receive the incentive, reward or perk you desire to redeem. And that's not all. Most reward credit card programs also charge high interest rates and exorbitant fees. So, you will certainly have to pay more when you use a reward credit card than when you manage a regular credit card account.

3. Foreign transaction fees can cost you a great deal of money. Many cardholders actually use their reward cards in making purchases as well as in paying their bills and other expenses abroad. But little do these consumers know that they are actually being charged with high fees and huge transactional costs every time they use their reward cards in paying for services or in buying products they need in a foreign land. This is the main reason why reward cardholders are advised to avoid using their cards in other countries. If they really need to buy items and pay for services, then they might need to do so using traveler's checks or cash.

Always remember these trade secrets of card companies and for sure you will succeed in protecting yourself from the financial risks and traps associated with the use of reward credit cards.

by: Ashley Jane Summers

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