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Are all the credit cards the same? Before you compare the various credit cards offered by different merchants and banks, you need to know a few main types of credit cards. It is then easier to select a suitable credit card.

If you need to entertain your guests or travel frequently, the amount you spend may differ from one month to another. Without spending limits, charge cards will be suitable for those who need to spend large amounts on entertaining their clients. They offer short term loans without penalties if you pay off in full every month. American Express and Diners Cards are such travel and entertainment cards. American Express has other payments options available for you to make your payments over a longer period of time. Due to the different schemes available, some people may use the terms interchangeably, but these two are basically different.

The second type of major cards is the credit card we are familiar with. Visa and Master Card work with banks to issue credit cards to the consumer. The banks will determine the spending limit on your cards based on your income level. Different cards have different terms and conditions. If you only pay the minimum amount for your credit card payment, be prepared to fork out hefty sums that stemmed from your interest payments and new purchases. Due to the nature of unsecured loans, interest rates are considerably higher and over time, they may add up to a lot.

Business Credit Cards are the next type of cards. These cards are meant for those with small businesses, although some banks give them to their customers holding personal credit cards. These cards tend to have lower interest rates and higher spending limits. Cash flow issues can be easily resolved for small business with business credit cards as you can pay the bills over an extended period.

Last but not least, various major companies offer retail store cards. Some are linked to shopping malls or other retail stores or we have fleet cards, for various fuel purchases as well. Due to the numerous retail store cards, the terms and conditions are not alike. Only certain countries accept such cards.

Since various types of credit cards offer different conditions and payment options, you need to decide what cards such as charge cards, credit cards, business credit cards and retail store cards suit you best.

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