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Catalog credit cards are just like regular credit cards, in that they are used to purchase goods now and paid for later. But, catalog credit cards have limited function. They can only be used when making purchases at certain retailers or by catalog. The only real advantage to these cards is they often are easier to get if you've had past credit mistakes.
It is convenient as well. This is because, for majority of catalog credit cards, interest is only charged if the balance is not paid in full by the due date. And in most cases, catalog credit cards come with no annual fee. So, you might want to consider catalog credit cards if you are looking to rebuild your credit. But you should check the terms and conditions, in advance, for complete details.
But, your credit limit and minimum amount to be paid each month, as charges will depend on the department store or Catalog Company you obtain a credit card from. While catalog credit cards and department store credit cards can help your credit you should make sure not to go overboard. Too many credit cards can be viewed by loan agencies as a bad thing. And, since most catalog credit cards have lower credit limits than traditional charge cards, you risk tying up your credit for a small number of spending limits.
In an attempt by the issuers to make it more attractive, catalog credit cards now, often offer rewards for using it to pay for your purchases at their store. However, these rewards don't come for free. The aim of these rewards is to keep loyal catalog credit card customers coming back for more. But, don't let the promise of a 10% discount, exclusive offers and rewards lull you into agreeing to a lousy card deal. There's nothing rewarding about having your money sucked away in high interest rates.
Also, catalog credit cards are probably the most expensive way of borrowing money. They also have their limits, in terms of financial transactions. Catalog credit cards can only be used for purchases from specific catalogs and/or websites. Though they have easier approval requirements, often not requiring credit checks or employment verifications, it is better to have a normal credit card, which gives you much more.
So what's the point of having catalog credit cards? Forty years ago it made sense, in that if you didn't have the hard cash, the only way to take the waiting out of wanting was hire purchase or the 'drip', on tick or account or signing up to catalog credit cards. But, the subsequent wave of plastic credit, usable in an ever-increasing range of stores and outlets, has changed buying habits. They have eliminated the need for catalog credit cards. There are now over 160 million plastic cards in issue in the United States alone. And, last year they accounted for over $243.9 billion of spending.
Yet people still take out store cards. Since, plastic has officially taken over from cash as the favorite way to pay, why not go for another plastic fix? It's easily done in a weak moment; you must have the goods, and you obviously don't have cash. It has been calculated that nearly 50% of consumers who take out credit in this way, hadn't planned to do so when they left home.
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