Credit cards and credit catalogues are two financing options, which let you to make purchases even when you do not have or short on cash. They let you make the purchase with the assumption that you will be able to pay later on.
Although both these options serve a similar purpose, there is difference between credit cards and credit catalogues. It is important for you to understand how each of this card works so you can decide which is more appropriate for your situation.
With credit cards you can spend up to your credit limit, which could range from hundreds to thousands of pounds. Your credit limit depends on your credit history, income and how confident the bank is that you can pay it back.
In order to be approved for most credit cards you need a good credit rating and a credit assessment will be performed when you apply for the card.
Credit cards allow you to buy a wide range of products from different vendors. You can use them in shops and online, as well as for cash advances.
You should pay off your credit card bill every month to avoid interests levied on what you borrow. Therefore a credit card is suitable to purchase only when you are sure that you can pay it off at the end of the month.
These are credit programs offered by specific catalogues, and they allow you to order from them and make payments that are spread out over several weeks or months. For example, a fashion catalogue may let you buy a number of items and then make the payments over a set period of time, usually between three months and a year.
A major difference between credit cards and credit catalogues is the approval process. Although credit catalogues also perform credit checks, they tend to be more lenient and have higher approval rates than those for credit cards.
Although credit catalogues have the benefit of more lenient approval, their interest rates are higher than the interest charged for credit cards. With credit catalogues, your purchase is limited to particular items from particular vendors.
Although there is a lot of difference between credit cards and credit catalogues, your repayments on both will affect your credit rating in the future, so it is important to make regular payments as required.
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If you've already been rejected for credit it's normally best to wait awhile before you re-apply elsewhere.
Always compare different catalogues and stores to find the best prices.
Always read the terms and conditions in full and understand exactly how much you'll have to pay back.