With the rising popularity of credit cards, there are many companies that issue these cards for the ease and convenience of their customers. Several important players dominate the market, which includes credit card companies, credit unions, and banks. You should choose the best credit card company that fit your needs and will provide a consistent satisfactory level of customer service.
Credit card companies offer all types of credit cards that come with a range of different interest rates, benefits, and rewards. After applying for a credit card, your chosen company will determine if you are qualified before they issue you one of their credit cards.
What are the most popular companies that dominate the market?
According to CNBC.com, the world’s top ten credit card issuers are:
- Bank of America/MBNA
- American Express
- Capital One
- Wells Fargo
- Lloyds TSB/HBos
All these companies issue different types of credit cards. You should research the different companies to decide which card would best suit your needs. The different cards that are offered have different charges and processing fees, and merchants are required to process them differently.
How are credit cards issued?
The International Card Manufacturers Association (ICMA) represents the companies that manufacture and issue credit cards. The ICMA is a member of International Organization for Standardization (ISO) and the American National Standards Institute (ANSI).
However, before issuing the credit cards, all these companies will thoroughly check your credit score and your credit card application along with the supporting documents supplied. You will have to be a low risk applicant in order to be approved for a credit card. The credit card issuer needs to be certain that you have the capability of paying the debt.
Factors that dominate issuing a credit card include your:
- Credit history
- Job history
- Current debts
- Bank account
If your credit card application is denied, some banks might offer to issue you a secured credit card depending on your credit history instead of an unsecured card.
What type of credit cards are issued by these companies?
According to Money Personal Finance, the companies mainly issue three types of credit cards:
- Bank cards
- Travel and entertainment cards
- House cards
Most bank cards that are issued are either MasterCards, Visas, or Discover cards. You will also find dedicated credit cards that will take care of your entertainment and travel needs such as the Diners Club or American Express cards. House cards include credit cards for retail chains and oil companies such as Target or Sunoco.
There are also affinity credit cards and rewards credit cards, which offer incentives for using that particular credit card. An affinity credit card usually will provide a donation to the sponsoring organization in lieu of a reward to the cardholder, while the rewards credit card provides an incentive to the cardholder.
The consumer card is the most common one this is used by the average credit cardholder. These cards tend to be very basic cards that offer no rewards and are not associated with any business. With reward cards gaining popularity, basic cards are not usually the preferred choice of many people.
You will also find check credit cards, which are similar to the debit cards with a PIN where the funds are almost immediately transferred from your checking account. The other popular choices for credit cards include secured credit cards and prepaid cards that are issued by credit card companies.
All these cards have different functions and you will need to determine which card will be the best for you.
What are the costs for using these cards?
Credit cards do not come without costs, with most including annual fees just for using these cards. You may be able get introductory zero interest credit card, which will allow you to use your credit card for a limited time without being charged interest. Keep in mind, however that once this period is up, you will be charged interest retroactively on any balance that is on your card. The other costs involved are annual fees, credit card default rate, compound interest, and even a credit card late fee.
Additionally, all these credit cards come with specific tiers and depending on your credit score, the credit card issuer will assign your card accordingly. If your credit rating is good, you might be eligible for the gold card with a limit more than $5000 or the platinum card with higher credit limits. It is important to remember that these cards may have higher fees as well.
Use the FREE credit card finder on this page to find a great card now!