Credit Card Guide

What is a Student Credit Card?

16 August 2010 by CreditCardsCo™

The only way by which a person can apply for a credit card is if they have a past credit history to show that they are able to keep up with monthly payments. What that basically means is that for those individuals that are applying for credit cards for the very first time, they are going to find themselves faced with a bit of difficulty. Even though this is the case, there are a number of schemes out in the market that have solely been targeted towards a specific crowd in order to help them build their credit history. This is where the concept of a student credit card comes into play. Students are mainly studying in university or college in full time education. At most, they would be employed at a part-time job as well while they are studying. Appling for a normal credit card on that merit alone will automatically lead to rejection.

For this reason, there has been a separate category of credit cards for students alone. There are a number of differences in a student credit card in comparison to a traditional one. As you can expect, a student credit card will not have generous terms and conditions in terms of credit limits and repayments. The credit limit that they will be granted will most likely be of minimum value and the repayments would be required to be as quick as possible. Even though the terms and conditions may seem to be quite rigid in comparison to a normal credit card, applying for a student credit card is a great way to get a head start on your credit history. Most students tend to get carried away when it comes to using their credit card as they tend to forget that they are liable to repay any amount that they use.

If you are planning to make effective use of a student credit card, it is very important that you only use it in times of need and keep money management in mind at all times. There are a number of benefits that student credit cards are entitled to such as cash backs up to 10% in certain stores and restaurants including book stores. If you are thinking of applying for a student credit card, it would be a good idea to take your time in researching which ones are worth opting for and which aren't. Students are the most promising prospects for credit card companies as there is a high probability that they will be employed at a good job in the future due to their education.

What that basically means for credit card companies is that they will have customers that will be able to utilize their credit limits to the maximum ability and still be able to meet repayments without too much hassle. As a result, it is quite common for student credit cards to offer lenient interest rates however it is important that one reads the fine print agreement. Most of the clauses that matters are usually "hidden" in the fine print which you are expected to read and sign.

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