With the economic situation beginning to ease slightly banks are more than willing to offer credit cards again to willing customers. After keeping a low profile for the last three years due to the economic downturn, the credit card industry is returning to normalcy. The offer brochures are making their way to the postboxes urging customers to apply for them.
While it may seem to bring a smile to the face of people who were waiting for this opportunity, there is a need to be careful. The credit cards being offered by banks today are a far cry from the zero interest credit cards that were being offered prior to recession.
The current cards offered by banks have higher interest rates and the concept of no annual fee has been taken off. While these financial institutions are surely taking a step forward, they are trudging very carefully. Banks are offering these cards only to people who have a good credit history backing them. People with a poor credit score will still be given a backseat and will need to wait longer to get these cards.
People who are planning to apply for these cards should think twice before filling out that application form. It is imperative to scrutinize the terms and conditions with a microscopic eye and get all the relevant details clarified before signing on the dotted line. Here are a few factors that you should look out for.
Keep in mind the annual fees of the card. Gone are the days when you could keep your credit card in your wallet and not spend on it thinking you will be charged nothing. Annual fees are back and this time, there are a few on the higher side. So, watch out for them!
On the positive side, customer rewards will be higher this time. Credit card users will be given points on their purchases which can be then reclaimed for cash back facility, air tickets or any other merchandize. This is being done in order to encourage card holders to spend using their cards. However, if you are not good in repaying debts, this may seem to be a drawback for you. Spending on your cards just for points and being unable to repay the dues can cost you in the long run.
The interest rates and balance transfer charges are the other points to look out for.