A woman holding several up different credit cards to choose from as she shops online.

Credit cards come in many different flavors with plenty of options to choose from. Let’s look at seven different types of credit cards and how each kind might fit your wallet.


Smart Swiping: How 5 Credit Card Types Work For You

Like ketchup, credit cards come in many varieties, each with a different combination of rates, fees, rewards, and add-on features. Here we review some major credit card types and look at which ones are likely to work best for you.


1. Balance Transfer Cards

This type of card is intended to help you transfer and pay down a balance you accrued on a higher-interest card. Good balance transfer cards feature a competitive ARP and no balance transfer or annual fees. 

Some balance transfer cards offer an introductory 0% APR period to allow you to focus on paying down your existing debt. However, when the introductory period ends, the APR on these cards usually reset at a far higher rate. This reset can catch an uninformed consumer off guard, adding interest charges while increasing the card account balance and total debt owed. 

Balance transfer cards are a smart choice if you’re serious about coming to grips with significant credit card debt. Just be sure to look for a card without a balance transfer fee, like our Bowater Visa® Cards, since those fees add up quickly and end up being an unnecessary expense. 

2. Secured Cards

Unlike most credit cards, which are a form of unsecured lending, secured cards are granted when you put up collateral—normally a cash sum roughly equivalent to the amount of money you want to borrow. While this may seem counterintuitive, secured credit cards are the easiest type of credit to be approved for and usually feature relatively good rates.

This is a fairly specialized card intended for people trying to establish or reestablish credit. While you won’t be able to borrow much more money than you already have, it can be useful if you want to improve your credit score or re-establish good credit after a financial setback.

3. Store Cards

Store cards are credit cards offered by individual merchants rather than one of the big credit card suppliers like Citi, Chase, Visa, or American Express and can usually only be used for purchases from that merchant. Expect generous no-payment or even 0% APR periods, but be prepared for far higher interest rates and even retroactively-charged interest thereafter. 

A store card might work for you if you’re a regular and loyal shopper. You’ll get the benefit of special offers and discounts and will save money if you’re able to pay off your purchases relatively quickly. But, as always, watch out for high annual fees and other charges. Store credit cards are notorious for driving consumer debt.

4. Cash-Back or Rewards Cards

If you want to get rewarded for using your credit card, even on everyday purchases, a cash-back or rewards card might be a good choice for you.

A cash-back card offers cash rewards or statement credits on your spending. How rewards are actually returned to you varies widely, from a flat rate percentage to special bonuses for spending on categories like dining, travel, or home improvement. 

Similar to cash-back cards, rewards cards reward spending in specific categories with points or bonuses that can be redeemed in specific ways. Bowater Credit Union’s ScoreCard Rewards Visa® Credit Card, for example, pays a point for every dollar spent that can be redeemed for:

  • Airfares
  • Hotel and rental cars
  • Travel packages
  • A wide range of merchandise

The ScoreCard Rewards Visa® Credit Card is a great all-around choice that will earn you regular redeemable points on your everyday spending. It also offers no annual fee and an APR as low as 6% for qualified applicants.

Cash-back or rewards cards are a good option if you’re a regular credit card user with a solid payment record. If you’re able to match the rewarded categories to your spending patterns you might earn significant rewards or cash back. 

5. Low-Rate Credit Cards

Low-rate credit cards offer competitive rates and no-frills service. For instance, Bowater’s Classic Visa® Credit Card will give well-qualified applicants a fixed 9.9% APR on purchases and cash advances, no annual fee, and no fee on balance transfers.

Our Classic Visa® Credit Card and other low-rate cards offer long-term affordability and purchasing power. With no fee on balance transfers, it’s also a good way to lock in a great APR to pay off existing credit card debt. For borrowers with a good payment record, low-rate cards offer bottom-line value that really adds up. 

You Can Bank on Bowater

At Bowater Credit Union we offer credit card services combining industry-leading features and security with the non-profit affordability and personal service our members expect.

Our low-rate Classic Visa® Credit Card provides the security and certainty of fixed-rate borrowing with the go-anywhere convenience of a credit card. Plus, its O% transfer fee makes it a surprisingly smart option for paying down existing debt.

Click below to learn more about how Bowater Credit Union can help you swipe smart with our innovative credit card offerings.