Target REDcard Review: Their Debit vs. Credit Card
The Target REDcard could save you 5% on almost all your Target purchases - but which one should you choose? Credit? Debit? This in-depth review will help you figure out which card is right for you.
It's a common situation: You walk into Target planning on only buying one item, and walk out with a cartload of new purchases. With the Target REDcard credit or debit card, you could save 5% on almost everything Target sells.
The history of Target and its REDcards
Target rose from its humble beginnings under the name Goodfellow Dry Goods in 1902 to become the second-largest discount retailer in America. You can see the Target logo at any of the 1,806 stores the company operates, as well as in your wallet with a Target REDcard.
In 2015 Target became the first major credit card issuer to introduce a chip and pin system for extra security. The Target REDcard was the first to have the now-familiar gold or silver square seen on almost every credit card and requires users to input a four-digit pin instead of a signature when making purchases.
Find out whether the REDcard hits your savings target
Starting with the obvious, both the credit and debit versions of the Target REDcard are perfect for frequent Target shoppers. You can only use these cards at Target though, so those seeking an all-purpose credit or debit card should look elsewhere.
If you do make most of your purchases at Target, then these cards can save you 5% on almost everything whenever you're in the checkout line. You also get extra perks like an extended return policy and free shipping on most items at Target.com.
The Target REDcard credit card accepts applicants with less-than-stellar credit histories, making it perfect for folks hoping to rebuild their credit score.
Know the top five things about Target REDcard credit and debit cards before applying
Keeping a few things in mind can help you find out whether the Target REDcard credit or debit cards are right for you.
- You can only use these cards at Target and Target.com
- These cards offer a 5% flat discount on most purchases – it's not a cash back or points rewards program
- Most Target REDcard purchases qualify for an extended return policy and free shipping from Target.com
- Applying for the Target REDcard debit card doesn't require a credit check
- You only need a 550+ credit score for the Target REDcard credit card
Credit or debit: Which one should you get?
Both the Target REDcard credit and debit cards offer the exact same rewards of 5% savings, extended returns, and free shipping on Target.com.
The Target REDcard credit card comes with the usual drawbacks of a store card like a high APR and low credit limit.
However, it only takes a credit score of 550 or above to get a Target REDcard credit card. That makes it perfect for those hoping to boost their credit scores as long as they pay off the balance every month.
For everyone else, the Target REDcard debit card is the way to go. You get all the rewards of the Target REDcard credit card, plus spending only limited by your bank balance with no APR.
That means a cardholder with a $500 credit limit couldn't pay for a $1,000 TV with their credit card, and therefore wouldn't get the 5% savings. Even cards with credit limits covering $1,000 purchases will face a sky-high 23.9% APR if they carry a balance month-to-month.
How Each Card Works
These cards offer discounts and perks that make your money go farther every time you shop at Target.
Both cards offer the same rewards. You get 5% savings and a 30-day extension for making returns on most purchases, as well as free shipping on many items at Target.com.
Unlike cards from American Express or other credit issuers, you can only use these cards at Target. You also won't get a big introductory offer, cash back, or other rewards like you would with a Chase or Citi card.
Neither of these cards offers financing options like the WalMart or Best Buy store cards. That means pay off any big purchases made on the credit card before your bill comes due or they start collecting a staggering amount of interest.
Even with those drawbacks, both of these cards offer a simple, no-frills way of saving money on all your Target purchases.
Easy approval means the Target REDcard credit card may deserve a place in your wallet
So the Target REDcard credit card from TD Bank doesn't differ from the debit card in any significant way, can only be used at Target, has an astronomical APR rate, and often comes with a low credit limit. With that said, it may still be a great card for some shoppers.
Christina Majaski of MyBankTracker noted that this card accepts most applicants with credit scores of 550 and above. That means people who may not qualify with the big credit card issuers like Mastercard can get a Target REDcard and start back on their journey towards healthy credit.
Get easy savings with the Target REDcard debit card
Issued directly from, and only usable at Target and its online store, the Target REDcard debit card gets you 5% savings, a 30-day extension for returns, and free shipping on most items at Target.com. You also don't need a credit check to qualify.
All those reasons mean that even if you only visit Target once in a blue moon, this card can save you a decent amount of cash. Those spending $100 every month at Target could save $60 every year with this card, which could cover a couple tanks of gas or a nice meal for two.
What people love the most about the Target REDcards
Everyone raved about how this card saves them money.
Most experts focused on how many dollars the 5% discount kept in their wallet. A 5% discount helped this card hold its own even when compared with traditional credit cards.
Consumers loved how this card could save them money on everything from furniture to electronics. While many cards like the Chase Freedom card offer 5% cash back on different purchase categories throughout the year, the Target REDcard offers a flat rate on nearly everything Target sells every day.
What people hate about the Target REDcards
A few things about the Target REDcard made people see red.
Everyday users complained about the customer service when resolving issues with both the credit and debit cards. Some noted that it took multiple calls to get answers about why they were charged a late fee, while others were stuck on hold for over 15 minutes whenever they called customer support.
The experts groused about the high APR and lack of introductory offers that most large credit card issuers provide, but noted these issues were typical with store cards.
A Quick Cheat Sheet
Target REDcard credit card
Why should you get it? To build up their credit and save on Target purchases
Why should you get something else? You want a card useable anywhere or don't usually shop at Target
Credit limit. $100+
Fee. $38 late payment fee, $27 returned payment fee
Rewards. 5% discount on Target and Target.com purchases, extended return policy, and free shipping from Target.com
Credit score requirement. 550+
Target REDcard debit card
Why should you get it? To save money at Target or Target.com
Why should you get something else? You don't usually shop at Target
Credit limit. None. Make payments directly from your bank account
Fee. $20 to $40 returned payment fee depending on where you live
Rewards. 5% discount on Target and Target.com purchases, extended returns policy, free shipping from Target.com
Credit score requirement. N/A
Credit card gurus agreed that these cards could potentially save folks a solid chunk of change.
Jason Steele of MoneyCrashers found highlighted how the 5% savings add up quick. Instead of waiting a month for your cash back or point rewards to kick in, you see a discount right at the register.
He also noted the debit card doesn't require a credit check or let users go into debt by racking up interest like the credit card. That makes it great for those looking to avoid the temptation to charge purchases they can't afford.
The perks were a big draw for Brendan Harkness of Credit Card Insider. Brendan loved how neither of these cards charge an annual fee, extend returns by 30 days for eligible purchases, and provide free shipping on Target.com.
Some experts noted that the positive aspects of these cards were accompanied by a few negatives.
Writing for Savings Freak, Paul emphasized that the credit card charges a jaw-dropping APR rate. If you carry any balance on this card, you'll get charged interest that wipes out your 5% savings and then some.
You also can't use the credit card to withdraw cash like you can with the debit card, which may be a turnoff for those who treat the checkout line like an ATM.
Taylor Tepper of Time also states that both of these cards can only be used at Target. That limits your options and makes it not a good choice for those looking for a card that offers savings or rewards on all their purchases.
The credit cards also come with a lower credit limit, which can not only keep you from putting big purchases on your card but also negatively affect your credit score. You should only use 20-30% of your available credit, so only putting $100 a month on a Target REDcard with a $500 limit will keep your credit score high.
As Rebecca Lake reports for Credit Sesame, neither of these cards offers a sign-up bonus introductory APR rate or financing offers. That means you should think about other options if you have a large purchase in your future.
Also about that free shipping with the REDcard – Target already waives the shipping fee on purchases of $35 or more. That means this perk may be useless for those who regularly spend that much or more on Target.com.
The biggest consumer complaints about Target REDcard credit and debit cards
Some cardholders offered less-than-happy reviews about their Target REDcard credit and debit cards. While most of these complaints pop up for any credit card, you should be aware of these complaints before applying for your card.
Mia wrote some choice words about wrongfully charged fees on Target's Better Business Bureau page:
"I DO NOT RECOMMEND ANYONE APPLY FOR a red card. They wrongfully charged me a two fee's and refused to take them off even after conferencing with my bank and having been wrong. They do not care about their customers and I despise my action of choosing to apply for a card."
Over on Consumer Affairs, Kenny from West Covina, California hated customer service:
"All they want is the money. Customer service reps are robots, and I spoke with 2 of them. They simply don't care, won't work with you, dishonest and heartless. This was the case even when you said you'd pay the whole thing off; even when I threatened to close my account. They just wanted the money."
Back on the Better Business Bureau page, Joanne took issue with her card gettingdeclined for no reason:
"I have made monthly payments on time for over 11 years so it is really frustrating to get a statement that shows you have credit available on your account and to have your card declined EVERY SINGLE TIME at the register."
REDcard's Main Competition
Target isn't alone in trying to put its store cards in your hands, with WalMart also trying to fight for space in your wallet.
Unlike Target, WalMart's rewards program offers cash back instead of a flat discount. Every card swipe earns you 3% back on WalMart.com purchases, 2% at WalMart and Murphy USA gas stations, and 1% on all other purchases.
These rewards get credited back at the end of the year, which is a long time to wait compared with the instant discount of the Target REDcards.
The WalMart Mastercard can also be used at every store, not just WalMart. That gives it a lot more flexibility than the Target REDcards.
All WalMart credit cards offer special financing programs, with no interest for six months on $150 to $298.99 purchases or 12 months for purchases over $299. However, if you miss one payment, all the interest you would have accrued up until that point comes due at once.
The WalMart debit card also comes with the drawback of being a reloadable prepaid card, meaning it's not tied to your bank account. You'll have to go through the extra step of transferring money onto the card regularly in order to use it.
The choice here comes down to shopping preferences. You'll get more value out of the Target REDcard if you shop there regularly, and the WalMart cards if it's your preferred retailer.
There are two exceptions here. If you have a big purchase coming up and want financing options or need a card usable anywhere that accepts applicants with a low credit score, the WalMart MasterCard should work for you.
REDcard Credit Card Overview
This card offers savings and perks for Target shoppers. While the debit card may be a better choice for some people, Target regulars looking to rebuild their credit can get a lot of value out of this option.
That's because applicants only need a 550 or above credit score. It doesn't charge an annual fee or require regular use to unlock its rewards, which makes it perfect for people getting back on solid financial footing.
The following items don't qualify for the 5% discount:
- Prescriptions, over-the-count items from the pharmacy, clinic services, and Target Optical™ eye exams
- Target gift cards and prepaid cards
- Certain restaurants in Target stores like D'Amico & Sons Italian Kitchen, Freshii and Pret A Manger
- Gift wrap and shipping and handling charges on Target.com purchases
- Wireless protection program purchases and required deposits from mobile carriers
Items not eligible for the extended return policy include Target Mobile purchases, purchases with a fixed return date, and non-returnable items.
How the card works
Let's say you bought some curtains for $30. If you purchase them at Target or Target.com using your Target REDcard credit card, you would only pay $28.50 after the 5% discount from your card.
Also, say you bought them on Target.com. Using your Target REDcard credit card would waive the $5.99 delivery fee typical for these orders.
If you bought these curtains using your WalMart credit card, you would get $0.90 back from WalMart.com or $30 from a WalMart store. It's not much different from the $1.50 off from the Target REDcard, but those savings can add up over time if you're a frequent Target shopper.
Now say you found yourself hating those curtains 30 days after purchasing them. You could still return them in the next 30 days due to the REDcard credit card's extended return policy.
The only drawback is if you forget to pay your balance for the month, those $30 curtains could cost you an additional $7.17 in interest due to the card's 23.9% APR.
What the experts say
Credit card experts loved this card. Money Under 30's David Weliver stated he uses the 5% discount to save on his everyday purchases from Target.
Consumers loved that too, especially how there's no minimum purchase amount required to save. From $1 candy bars to $1,000 couches, it's 5% off every time.
There are drawbacks, like how it's only usable at Target or Target.com, doesn't offer financing, and comes with a high APR. Also, there aren't any introductory offers like the Amazon.com Store Card's $40 gift card just for signing up.
Even with those negatives though, the everyday savings and easy acceptance policy make this a great card for those who want to improve their credit.
REDcard Debit Overview
This card offers savings for anyone who shops at Target.
There's no credit score required since it pays for purchases directly out of your bank account. That means no APR, worrying whether you'll qualify for the card, or making payments every month.
This also means that there's no credit line, as you can spend as much as your bank balance can afford. Also, you can withdraw up to $40 in cash back at checkout from your bank account using the Target REDcard debit card.
As for fees, it charges $20 to $40 depending on where you live for returned payments if your bank lets you overdraft your account. You can avoid this fee by avoiding spending more than what you have in your account, or by not opting into your bank's overdraft protection program.
The rewards and fine print are the same as the credit card, so you still get 5% savings and an extended return policy.
How the card works
Going back to those $30 curtains from the previous example, you would get the same 5% off, free shipping, and extended return policy by using your Target REDcard debit card instead of the credit card.
If you used a WalMart MoneyCard, you would get the same savings as the WalMart credit cards. However, you would have to make sure you have $30 loaded on your card before making the purchase.
Let's say you accidentally overcharge your account buying those curtains using your Target REDcard debit card. Instead of paying APR, you would get charged $20-40 for the returned payment fee.
What the experts say
Chris Mettler of Compare Cards loved the savings this card offers, as well as the extended returns. He also noted that it was harder to overspend with this card than a credit card since you're limited by your bank account.
However, you can't use this card to build credit. That won't be an issue for some people, but those hoping to rebuild their credit scores should consider Target's credit card.
Website, Apps and Digital Services
Target provides a few ways to manage your account online.
To make credit card payments or see your transactions, statements, and alerts, just visit the Manage My REDcard page.
The Krazy Coupon Lady found Target's online account management easy to use and navigate. This is mostly due to the structure of the Target REDcard's rewards, as you don't need to worry about managing points or redeeming cash back you've earned.
However, it is slightly frustrating that you can't manage your Target REDcard through the Target app. The website is your only option for making payments or seeing your transactions.
How to Get Started With Each Card
You have a ton of options when applying for a Target REDcard.
Any Target store will also help you sign up for one of these cards. You can also apply via mail if you're feeling old-school by downloading the credit or debit card application and following the instructions on the form.
When using these options to apply for a debit card, make sure you provide a voided check. They'll need it to link your card to your bank account.
If you want the best chance of getting approved for the credit card, make sure your credit score is 550 or above.
Your card will ship within 7-10 days if you're approved. If you apply for the debit card at a Target location, you'll instantly receive a temporary card you can use until your real one arrives.
After you've received your card, you can make payments through the Manage My REDcard online page, at any Target store or by calling (800) 659-2396.
How to Close Your Account
Canceling your Target REDcard can be a simple process.
For the credit card, make sure your account balance is paid off in full.
After that, take either your credit or debit card into a Target store and tell them you'd like to close your account. Bringing the card is essential – they can't look up your account number from within the store.
You can also cancel your account online using the Manage My REDcard page.
Alternatively, you can call (800) 659-2396 and cancel over the phone. A customer service representative will walk you through the process.
Can I pay off my credit card at Target?
Yes. Just bring your card to the guest services station at any Target and they will assist you with paying off your balance.
Does the Target debit card look at my credit score when I apply?
No. Target will not pull a hard or soft credit check for the debit card, leaving your credit score unaffected.
However, Target will run a credit check on credit card applicants.
Can I pay for my Target credit card with another credit card?
No. You can only pay your Target REDcard credit card online using your checking or savings account, or at Target using cash, check, or debit card.
Can I withdraw cash using my Target credit card?
No. However, you can pull out up to $40 using your Target REDcard debit card when making purchases.
Does my Target REDcard earn rewards?
The Target REDcard credit and debit cards don't earn rewards like other programs. Instead, they apply a flat 5% discount on most purchases from Target or Target.com.
Can I still get a Target REDcard MasterCard?
While Target used to offer the Target REDcard MasterCard, it is no longer taking applications for this card. You can still apply for a store debit or credit card.
Why does my Target REDcard credit card require a PIN?
Most credit cards require a cardholder's signature to verify their purchases. The Target REDcard credit card requires a pin in order to provide enhanced security for charges made on the card.
That way even if you lose your card, a person will not be able to make charges without knowing your specific PIN.
Since you're interested learning more about store cards like Target's credit and debit cards, then you should check out these reviews and articles:
- 12 Tricks Department Stores Use To Make You Spend More (without realizing it)
- Case Study: Credit Cards vs. Store Credit Cards
Did the Target debit or credit card hit your bullseye? What do you love or hate about it? Let us know in the comments below.