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Types of Credit Cards: Retail Credit Cards

Originally published in September 2019 and updated June 12, 2020

People love to shop at retail stores, and they love to shop with credit cards – it’s a fact that’s over a hundred years old. There are hundreds of brands that offer store-specific credit cards for loyal customers. They function much like any other traditional line of credit would, with a few unique exceptions, however. Whether you’re new to the world of retail credit cards or are finally ready to take the plunge after having been offered one by cashier after cashier, read our guide on a store card’s basics to get a better understanding of what makes up this particular piece of plastic.

Retail Credit Cards at a Glance

One of the first things to know about retail credit cards is that stores often offer two different versions: A “private label” card and a co-branded card. Private label cards are store-branded and only for use within that store. You won’t see familiar payment network logos, such as Visa or Mastercard, on them because they are not associated with such companies. However, financial companies and banks manage private label card accounts.

Co-branded retail cards allow you to use them at merchants outside of the sponsored retailer while still netting you benefits that go towards use at the said store. These cards are mostly “upgraded” versions of private label cards that grant customers more freedom.

What Credit Score Do You Need to Get a Store Credit Card?

Store cards are more accessible than other types of credit cards. As such, applicants don’t need to have stellar credit histories to be approved. Co-branded store cards do require a more robust credit profile than private label cards, but even so, they remain a good point of entry for individuals who are trying to build their financial reputation. Regardless of type, retail store cards carry high-interest rates, so it’s essential not to be trigger-happy when making purchases and completely paying off balances as often as possible.

What Fees Do Store Credit Cards Have?

Annual fees are not too common in retail credit cards, though some higher-end co-branded cards may carry one. Like almost all other credit cards, though, you will be charged fees if your payment is late or returned.

What to Look for in a Retail Credit Card

Most retail credit cards operate the same way and have a similar set of features. Keep an eye out for these when browsing for your next potential store card.

Signup Discounts: It’s a relatable experience for a retail employee to offer you their store’s credit card at checkout. It’s also familiar for said employee to pitch a signup incentive in exchange for opening an account, such as an extra discount on what you’re about to purchase. If you practice your timing wisely, you could earn that bonus discount in conjunction with other sales the store is promoting, thereby saving big bucks on something you were already planning to buy.

Rewards Programs

The meat and potatoes of a store credit card, a rewards program is the primary vehicle for maximizing your customer experience at a retailer. Whereas a merchant might have a “lite” rewards program in place that allows customers to freely earn points, having a retail credit card account often lets you earn points at a faster rate as well as receive additional promotions and coupons.

Exclusive Discounts

By opening a retail credit account, a store is likely to include benefits such as additional discounts on your purchase or free shipping.

Exclusive Customer Service

Some retail cards provide customers with customer service lines to assist them in finding items, completing orders, or receive other assistance.

Access to Sales/Presales

As a store cardholder, you may relieve access to exclusive member-only sales that either includes items not otherwise available to the public or deeper discounts than what the average consumer would find. Alternatively, you may be able to shop for new collections before they reach the masses.

Promotional APR

Another big selling point of retail cards is the option to finance certain purchases. It’s common for some store credit cards to offer 0% interest for set durations – 6 months, 12 months, 18 months, etc. – thereby allowing you to pay off large purchases over time without having to deal with pesky interest charges. However, you’ll want to make sure that you can completely pay off your balance before the promotional 0% term expires; otherwise, the bank may charge all the interest that would have otherwise accrued during the period in addition to your remaining balance.

Catalog Credit Cards

Catalog credit credits are a specialized form of a store card. These cards provide a set credit limit, that you use with an online shopping catalog or portal.

Why Choose a Catalog Card?

Catalog cards are ideal for those looking to repair their credit. Many retail cards are for those with fair or average credit scores. Catalog cards, like the Horizon Gold Card, on the other hand, are for people with poor credit, bad credit, limited credit – or even no credit history.

These unsecured credit cards are designed to rebuild credit, meaning they are easier to get than many other types of credit cards. Even better, they require no security deposit.

The Horizon Gold Card, one example of this variety of retail credit cards, offers $500 in credit for spending on the Horizon Outlet. This store provides several categories of merchandise, including clothing, toys, homeware, and more.

When a Retail Credit Card is Worth It, and When It Isn’t

If you’re a frequent shopper of a specific store or group of stores, then a retail credit card can give you extra benefits for what you’ve been doing all along: remaining a loyal customer. Earning rewards points at a faster rate, exclusive discounts and freebies, private access to sales – they’re all great incentives for customers who know where they like to shop and see themselves continuing that habit for the future.

If you have no go-to location, however, you won’t be doing yourself any favors by tying yourself down with a store card, especially if you mainly got it for the extra signup discount.

Store cards have considerably higher APRs than those in other categories, so carrying a balance can potentially hurt you more than you think. What’s more, store cards don’t set very high limits for customers, so expect to max yours out more than occasionally if you’re an enthusiastic shopper.

Essentially, retail credit cards have a very narrow focus, and they’re an excellent resource for the niche group that they target. If you’re in the market for a store card, consider beforehand what your commitment is to that particular merchant, how often (and how much) you see yourself spending there, and your ability to pay off a balance efficiently. Like most other credit cards, there’s no concrete formula that determines whether a card is good; instead, you should calculate whether a card is right for you.

About: Allan
Allan Guzman Chinchilla

Allan is the Managing Editor at In addition to leading a robust team of writers in the pursuit of thorough credit cards expertise, he is an avid fan of films, food, traveling, and Star Wars.