Find out all the basic information on charge cards below. For other types of credit cards, refer to the main Info Library menu.


Charge Cards

Charge cards offer you yet another way to pay in the US and worldwide.

What is a Charge Card?

Many people use the term 'charge card' as just another word to describe a regular credit card. However, there are some key differences between regular credit cards and charge cards.

Aside from these important differences, charge cards carry many of the same features as credit cards:

  • Worldwide acceptance
  • Financial freedom
  • Card security (fraud protection)
  • Use card to withdraw cash at ATM machines

What are the Main Differences Between Charge Cards and Credit Cards?

Charge cards are different to regular cards because they have higher or NO credit limit. At the end of each month, instead of paying a minimum on the card balance, the card holder must pay the balance (the bill) in full. As there is no long-term debt, often there is no interest associated with a charge card.

Generally, charge cards require an excellent credit history and a guarantee that the card holder can pay off their debt at the end of each month.

What If I Can't Pay my Balance in Full?

Charge cards have many benefits, but if the card holder cannot pay the balance in full at the end of each month, they will incur penalties. These may be high and therefore damaging to you and your credit report will suffer as a result of mismanagement of the card.

Who Can Get a Charge Card?

You can get a charge card based on a number of requirements these will usually include:

  • Minimum age 18 (or 21)
  • Permanent address in the US
  • Proof of ID
  • Excellent credit score/history
  • Minimum income
  • Fully employed

People that get charge cards should generally be able to budget well and be able to pay off their card balance in full at the end of each month.

What are the Benefits of Charge Cards?

Charge cards are great if you like to control your spending and clean up your debts each month. With either no or a higher credit limit, they are also great if you have a high income and want more financial freedom from a card. Many charge cards carry a range of excellent additional features, including reward schemes and other beneficial programs.

What are the Disadvantages of Charge Cards?

Charge cards carry a lot of beneficial features but they are principally geared toward people with an excellent credit history and a high income. If you do not possess either of these, it may not be worth considering charge cards. Another drawback is that if you are unable to pay your balance in full at the end of a month, you can incur high penalties which are not only expensive but could damage your credit report.


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