Kredittkort: Understanding the Different Types of Credit Cards

Credit cards undoubtedly provide us with convenience. With this piece of plastic, you’re able to purchase an arguably unlimited range of goods and services. But before getting yours, it is important you know the right one to choose. In this article, we will look at the different types of credit cards and their uses. 

Credit Builder Card

A low credit score can happen to the best of us. A rough patch or forgetfulness can make you miss your payment, and this inherently affects your credit score. A user with a low score would find it hard to get assistance from banks and loaners for several reason. Should you find yourself in this spot, it is necessary to look for ways to restore your lost financial reputation. 

A secured credit card is perfect for this job. Getting this card is very easy because you have to pay a security deposit. This makes the company less worried about your inability to repay at the end of the month. Your security deposit most times is directly proportional to your credit limit. This way when you default, your debt is already settled beforehand. 

So, for example, if you want to access a credit of $1,000 you must first make a deposit of $1,000. You can now see how this type of card is perfect for building lost credit. All you have to do is stick to your monthly payments and you’re on your way up. 

Student Credit Card

These cards are created specifically for college students. In fact, some companies require proof of admission before issuing you a card. They’re pretty easy to get as the requirements are not so strict. This is because a student is not expected to have exceptional financial history at that stage. 

Some credit card companies encourage students to study more by offering rewards for good grades. These cards have extremely low-interest rates, sometimes you get 0% interest rates! If utilized correctly, this is a good way to build your credit for the future. Visit  to learn more about student credit cards.

Travel Credit Card

This type of card would interest consumers who are fond of traveling. This is because the rewards are targeted specifically to travelers. Your accumulated points can be used to pay for trips, book hotels, or make any other travel-related expenses. 

The best part of these cards is you can use them across a variety of airline companies. That’s right, you’re not restricted at all so long as it is a general travel card. How do you accumulate points? You might ask. Well, it works the same as any other card. Simply using it to pay for goods and services does the trick.

Cashback Credit Card

As the name implies, this type of card gives you cashback with each transaction you make. The reward can vary depending on the card, but it is either a cashback or a statement credit. Your rewards can come in different forms. For instance, some cards offer flat-rate rewards. What this means is no matter what you purchase, the reward stays the same. The standard rate of return is 1.5%, but you can find some cards offering 2% now.  

You might also come across those with rotating bonus. Cards like these change the area they award bonuses periodically. If you’re lucky you could get a flat rate reward on your other purchases not covered by the bonus. 

Reward Credit Card

We love being appreciated when we do something beneficial as humans, but it gets even better when we’re rewarded for spending money. Hard to believe such exists, right?  Well, it does. With a reward card, you get a point in return for every transaction. These points can be used to procure other services and goods. 

The rewards you can get with this card range from free travel miles, meals, gas, and cashback. It goes on and on, and each day new winnings are added. This card performs best for small purchases you can easily pay off at the end of the month. This way you get your rewards back and make other purchases. 

We should point out that some credit cards are tied to a particular niche, such as fuel, travel, food, groceries, and so on. A prime example is the fuel card or bensinkort as it is called in Norwegian. As you might have guessed, this type of card can only be used in fuel stations.

Balance Transfer Card

Sometimes people fail to meet up with card payments and this can happen to the best of us. When it does happen, your interest rate will most likely be bumped up as a penalty. This can be managed with the use of a balance transfer card. 

The way this works is your high interest is transferred to your balance transfer card with a low-interest rate. In fact, you can get as low as 0% APR on some cards. It’s worth noting that the introductory interest rate has an expiration period, this is often 15- 18 months. Before you can get the best intro APR available, your credit score needs to reach a minimum of 690 using the FICO scale. 

Final Thoughts

You can see how the concept of a credit card encompasses different niches. It was made this way to maximize rewards in a particular area. Before you pick a card, it is necessary to pick one that adequately suits the type of transactions you make. Make sure you scrutinize the terms and conditions section to ensure the interest rates are to your liking.