Credit cards are now available in a particularly large range on the market and it is becoming increasingly difficult to find the right card for yourself. It is actually not a problem once you have an overview of the various options. If you know exactly what to expect from your credit card, you will certainly find it quickly.
Above all, it is the terminology that knows how to confuse credit cards. There is the prepaid credit card and the ChargeCard, there is Platinum or Standard, Visa or MasterCard. Of course, one or the other terms are well known or at least you have heard them here and there. However, it can be helpful to get a small overview again and to be able to make a better decision.
Credit Card or Charge Card?
The classic credit card, which is particularly popular in Germany, is the credit card. Basically, it simply has the English name for credit card, which should make it clear that this is the classic. The idea behind the credit card is that the user has access to the credit limit and can gradually pay off the credit used. The disadvantage here is the relatively high interest rates. This is because interest is paid on the available credit line that is not paid within a month. In this sense, the credit card works like a classic loan.
The Charge Card is Also a classic and long Also Prevents liabilities Arising from
Unlike the credit card, there is no delay in payment here. Anyone who uses the charge card’s availability limit must balance it within four weeks. So once a month there is a statement on which all expenses are noted. This statement should be checked because the bank will then withdraw the amount from the reference account. The amount of the credit limit for both credit cards depends on the monthly income of the holder and whether he has a good credit rating. The availability limit can also be adjusted if desired. In this case, proof of earnings is possible.
On a credit basis: the prepaid credit card
The prepaid credit card is an excellent alternative for anyone who would actually like to have a credit card, but who either has a negative credit rating, is too young for a classic credit card or simply does not want to take on any liabilities. The prepaid credit card works according to the top-up system. This means that it can only be used with credit. The credit is transferred to the card via a reference account and can then be used up. If the card is empty, it cannot be used until it is reloaded. The idea behind this is that the cardholder does not build up any liabilities but uses the card with his existing money. Nevertheless, the prepaid credit card offers all the advantages of a classic credit card.
If you would like to have a slightly larger budget, but would like to make up for it quickly, the best option is to use the Charge Card. A credit card, which also allows payment in installments, should only be used if you are aware of the amount of interest, which can sometimes be higher than the amount of a normal loan. The prepaid card is ideal for pupils and students or all users who like to be free of liabilities. It is also very suitable for use when traveling. If it is lost and gets into the hands of fraudsters, the amount by which the user can be cheated is clearly limited. In addition, the prepaid card is issued without a credit rating query and is usually particularly cheap.