How To Understand Store Cards
| Business : Borrowing Store cards are all around us these days - it is impossible to enter any large high street store without being offered one or at least seeing promotional adverts. Although they function in the same way as a credit card, many people say that they are even worse as the APR rates tend to much higher than the average credit card provider, with rates going up to 30%. Many people are tempted by a store card because most of them offer a special deal on your first purchase, often a discount on that and subsequent purchases, or incentives to buy to increase your points total, if the store runs such a scheme. These cards will not pose too great a problem if you pay the entire balance off within the interest free period, but if you cannot do that, the debt mounts up quickly as you will buy more on it, often not realising how high the interest rates are. Sometimes the interest starts being added on from the day you made the purchase, so you should always read the small print so you know exactly what the terms are. There are some store cards that have lower than average APRs, so if you must use one, it is best to apply for one of them. Or, if you really want to make the most of the special discount on your first purchase, use it to pay for that, pay off the balance in full and then cancel the card completely. Store cards often have other advantages such as being invited to special shopping evenings, getting exclusive news about special offers, receiving a store magazine, but if you are going to use them to borrow money they are not regarded as the safest option. It might be better to shop around for an ordinary credit card with as low an APR rate as possible. Bev Woolfson
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