subject: The Differences Between Different Credit Cards Offered At Credit Card Companies [print this page] There are a lot of differences between credit cards that are offered at credit card companies. Places like Capital One, Bank of America, Chase and other Credit Card Insider companies, have vast differences between one another. For instance, Capital One is not a large bank like Bank of America. For this reason, Capital One usually focuses on giving credit cards out to people who qualify for them. While you may get turned down for a credit card at Bank of America, Capital One is a good example of a company that may be able to give you one. For instance, if you are a student, with no credit history, the student credit cards offered at places like Capital One are easier to obtain than if you apply for a card at a big bank. This is because they specialize in credit cards, it is their primary offering to the public. They want to get as many people out there using their credit cards as possible.
Reward systems
It seems like today, just about every type of credit card has some type of reward system. This could be cash, that is provided to you when you use your credit card effectively. Understand one thing. Reward systems can be complicated and tricky. They are not designed to put money in your pocket, they are designed to entice you into getting the credit card. Quite often, reward systems are implemented, when the interest rate on your credit card is quite high. Because they don't want to have you see that the interest rate is high, they confuse your mind with lots of rewards, so that it looks like you are getting more benefits than you really are. Of course, there are good reward systems out there, they are not all bad. Some reward systems can provide you with a lot of money if you spend your card in the exact way that it is intended for. For instance, Credit Card Comparison sites show there are credit cards specifically geared toward gas. When you spend money on gasoline, you earn rewards rather quickly. However, the interest rate on the card is going to be high, which means you probably won't want to use it for any other type of expense. You will basically be purchasing this credit card, to solely use on gas expenses. It's not wise or beneficial to you, to use the card for other type of expenses, since you could get a different card with a lower interest rate for those types of expenses.
Interest rates
An interest rate is how a credit card company makes money. They allow you to spend money on the credit card, regardless of if you have that money in your bank account. While it's unwise to spend money that you don't have, this is how credit cards work. They charge you a rate on top of the money that you owe, so that they can make money. Essentially, you make monthly payments for the credit card, and over a period of time you can repay the debt that you have collected. This is a fine and dandy solution to purchasing things that you don't have the cash for all at once.
