Applying for Student Credit Cards
A student credit card is a type of payment system wherein a plastic card is issued to the student subscriber to be able to use it as payment. The issuing bank lends money to the student to be able to pay for goods and purchases from merchants, and allows them to revolve the balance at a certain amount of interest charged.
Why do credit card providers offer students? There are two major reasons why credit card providers offer students, particularly college students, card applications. One reason is to help the young adult establish a credit history, also known as a credit score. The other reason is for profit.
Since students do not have a credit history prior to owning a student credit card, it is likely that they stumble and struggle with the payments and fees. Which in turn are being taken advantaged by some scheming providers. On the other hand, providers that are after the well-being of students would want them to retain good standing to be able to pay on time and to build up a good credit history for their future purchases.
Student Credit Card Vs. Regular Credit Card
You might think that credit card providers are out of their minds in offering students with student credit cards would you? Well, there is more to student credit cards than just profiting from these youngsters. As mentioned earlier, a good way to establish a credit history is through availing a credit card as early as student life.
In comparison with a regular credit card, a student credit card does not require a student subscriber a credit history or some sort of financial document/income declaration stating that he/she is capable of handling a credit card. But, providers can only give a limited amount of credit limit to student subscribers- at $300 to $1,000- and normally low interest rates to be able to help them pay for their dues in time.
For younger subscribers, such as high school students, parents are asked to co-sign their credit card applications to ensure the provider that whatever happens, the parents will be liable to pay for their teenager’s dues.
Special rewards programs specifically made for student credit cards are offered by most providers as a come-on to students and parents. You need to beware, however, those student credit cards with rewards programs usually come with higher APR compared to those that do not have rewards programs.
Special discounts on books and school supplies can be availed through student credit cards. Other privileges that are geared toward student interest and college/university expenses can also be availed through student credit cards. Ask your provider about other add-ons specifically for college expenses and emergencies.
Word of advice, a student credit card is still a credit card. Though you may be given more leeway or you’re not required to submit any financial document at the onset, you are still liable to pay whatever dues you will incur. You may have advantage because as a student you are offered more privileges to help you establish a good credit history for your future endeavors.
Just like any form of credit, a student credit card is a privilege that should be taken care of responsibly and paid on time to maintain a good financial standing and credit score.
Bad Credit Credit Cards :: Jan.20.2008 :: Credit Card Offers ::