Types of Reward Credit Cards

Types of Reward Credit Cards

Types of Reward Credit Cards - Reward Card Types - Different Types of Rewards Credit Cards - Reward Card Types | Tips on - Find TipsCredit cards that offer various reward programs are often preferable to ordinary credit cards. The aim of the reward credit cards is to encourage credit card holders to spend more with their plastic cards. There are different types of reward credit cards.

Cash back card

Cash back credit cards are perhaps the most popular reward credit card. When you use such a card for making purchases, you earn cash rewards. It is possible to earn up to 1 percent of the expenditure cost with cash back credit cards. The cash reward earned is exclusive of finance and interest charges. As you increase the use of the card, some companies would award you greater cash back. Some companies reward cash back only at selected merchants or on purchase of specific products. Compared with ordinary credit card users, cash back credit card holders are generally charged higher annual fees.

Reward point cards

These credit cards, unlike cash back credit cards, do not award cash back, but points are awarded. The more you use a credit card, greater will be the number of points awarded. These points are redeemed to obtain rewards, such as gift cards, concession on purchases, discounts in hotels or on plane tickets and so on.

Some credit cards offer rewards for spending in certain hotels. These cards are often jointly branded with specific hotels. By using these credit cards, you will receive discounts for spending in specific hotels. By redeeming your points, you can avail free stay for a few days in these hotels.

Similarly, some cards are co-branded with some major merchants. When you buy from specific retail stores, you are awarded greater number of points compared to points earned by shopping in other stores. The points can be redeemed for making purchases only in these specific stores. Some credit cards offer concession on your gas expenses.

While brand specific credit cards allow discounts on gas bought from a particular company, general gas credit cards, treat all gas companies equally. Some reward credit cards help consumers to earn extra point for purchasing specific products.

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