Department Store Credit Cards
For loyal shoppers, store credit cards can offer perks, discounts, exclusive event access and more.
When they were first introduced, department store cards were specific to one retailer or group and could only be used to shop there. Slowly, credit cards began to replace this type of department store card and now many of these same merchants offer what is called a "branded credit card". They are issued and serviced by another bank or lender but display the store name / logo and offer unique store perks and rewards. The drawback to these store credit cards is that you may be charged a higher interest rate and the rewards often do not extend to other retailers.
How do store credit cards work?
Store credit cards work in the exact same way as traditional credit cards. You make purchases using the card in-store, over the phone or online and you can pay them off over time. Because they're issued by a regular bank or lender, the minimum repayments, interest, fees and charges work in the same way as a standard credit card and are outlined in a product disclosure statement by the bank.
Who makes money out of store credit cards?
All of the fees and charges you pay on the credit card are received and processed by the issuing bank (eg. by Citi on a Coles credit card) just like a standard bank-issued credit card. The store then receives a percentage of the revenue.
Which financial institution issues my store credit card?
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