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FREQUENTLY ASKED QUESTIONS ABOUT STUDENT CREDIT CARDS

If you are a student then you will probably be wondering whether there are any credit cards for students. Well there is a credit card for students as well. It is called as “Student Credit Cards”.

These cards can give an early start for a student to gain financial independence and also become a responsible adult. This is the reason why parents open a credit card account for their child or they even have the option of giving a credit card that is linked to their account itself. However, getting them their personal credit card is a better option. There are many FAQ’s asked by the parents about the student credit cards, some of which are listed below:

1)    Why is a “Student Credit Card” needed?

Because the credit card is in his name, it helps to build his credit report from a young age which will prove advantageous to him. The longer the credit history of a person is, the better for his/her credit score. This is the reason why, people who have started to build their credit history early have good credit scores. On the other hand, if the student has a credit card linked to his/her parent’s account then it will not help the student in any way and also has the risk of denting the parent’s credit score when large debts are made. Therefore, apart from teaching them to be financially responsible and building a good credit report, it also protects their parents.

2)    What is the reason for the Credit Card firms to provide special credit cards for students?

Obtaining your first regular credit card with a decent APR is extremely difficult. You need to have a good credit report to get a regular credit card. Also, according to the credit card companies, the students who want a good future are more likely to pay their credit card payments religiously than the non – students. Also, since it will be their first card the students will be more loyal towards it. This is why the credit card companies want to make long term relationships with the students.

3)    What are the benefits of the “Student Credit Card”?

Besides all the benefits that we talked about till now, these cards also have many other benefits. Some companies offer cash back and reward programs. Some other companies give discounts at places which are useful to students like bookstores, libraries and restaurants. Not all the providers of credit cards give these benefits; therefore it is compulsory for you to do some comparison of all the companies before making the final choice.

4)    What different types of “Student Credit Cards” are available?

When it is about “Student Credit Cards” then the only two options that are available are Unsecured or secured. This works the same way as it works with the regular credit cards.

5)    How is a student credit card different from the Traditional credit card?

The primary difference is that the credit limit for the student credit card is extremely low when compared to the traditional credit card.

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