Store credit card applications skyrocket around Black Friday — but the discounts they offer come with a catch

shopping teenagers retailThomas Lohnes/Getty Images for RESERVED

» Top New Products

Natural colic relief

An  easy,  simple  and  extremely  effective  method  of  natural  colic  relief  that  really  works.                     

Niche Marketing Kit

The  BIGGEST  and  BEST  Internet  Marketing  Complete  Toolkit  We've  Ever  Released...                                         

Own A Live Aboard Boat Today

This  guide  will  teach  you  the  basics  of  buying  a  live-aboard  boat  on  a  shoestring  budget.                     

Destroy depression eBook

7  step  system  that  gives  you  the  power  to  destroy  your  depression,  end  your  feelings  etc.                     

MP3 Meditation Club

High  Quality  Brainwave  Entrainment,  Only  $24  Each    and    Free  Shipping                                                             

Science Proves Magick Real?

Discover  The  Shocking  Experimental  Secrets  That  Proves  The  Existence  Of  Magic...                                       

Women should NEVER diet

Here's  the  exact  reason  women  should  NEVER  diet  like  men.                                                                                     

Build Lean Muscle In No Time

Workouts  That  Anyone  Can  Fit  Into  Their  Busy  Schedule  To  Burn  Fat  And  Build  Muscle                                   

ClickBank ad rotator

An  alternative  method  of  generating  ad  revenue  from  your  websites  and  earn  dollars.                                 

Hair Loss Protocol - Video

Experience  a  thicker,  fuller,  and  healthier  head  of  hair  that  everyone  will  envy.                                     

Make a 1920's Dress

How  to  make  a  1920s  flapper  style  dress  in  only  one  hour.                                                                                     

Marathon training plan

The  100  Day  Marathon  Plan.  Helps  All-level-runners  Achieve  Their  Marathon  Goals.                                       


  • Many retailers lure customers with store credit cards during the holidays, which offer discounts in exchange for loyalty.
  • But interest rates on retail credit cards have risen to almost 25%, or more than 10% higher than general-use credit cards.
  • If you carry a balance, it’s not a good financial move to sign up for one.


For a frequent shopper, nothing is better than a good discount.

Thankfully, shoppers no longer have to wait around for bargain holidays like Black Friday or Cyber Monday to get their fix.

Stores like Macy’s and Nordstrom have begun offering deals year-round to combat the retail apocalypse. One way they’re luring customers is through store credit cards and accompanying loyalty programs. In the US, consumers hold an average of 1.51 retail cards, according to Experian’s annual State of Credit analysis.

The most popular time for sign-ups is during the holidays. In fact, discount retailers, online stores, and jewelry stores nearly double their sign-ups in the month of December.

But while the initial offer can seem enticing — nearly two-thirds of the store cards recently surveyed by offered same-day, percentage-off discounts at sign-up — it’s not always a good financial move.

Interest rates on the average retail card have risen for the third straight year to 24.99% compared to the average general-use credit card APR of 16.15%, according to

“When you sign up for a store credit card, you’re also signing up for frequent nudges to buy, buy, buy, which means you’re often spending more than you would normally,” financial planner Sophia Bera, wrote in an article for Business Insider.

That means your loyalty can come at a steep cost if you don’t pay off your balance in full. The average retail cardholder has an outstanding balance of $ 1,081, according to Experian.

“The reason the interest rates are higher [than general-use credit cards] is that retailers are much more liberal in issuing a credit card to customers than the banks might be,” said Craig Shearman, vice president at the National Retail Federation. “These cards are very often offered to young people who are just starting to build a credit history or they can be offered to someone who maybe has a weaker credit history who wants to get a card.”

The retailers with the highest interest rates on their credit cards are Big Lots, Zales, Brandsource, and Piercing Pagoda, which all offer APRs near 30%, the maximum allowed, according to the survey.

A high interest rate coupled with a habit of not paying your bill could could be damaging.

“If you tend to carry a balance on your credit card, an interest rate this high will come back to bite you,” Bera wrote.

Some retailers offer special financing or deferred-interest deals, but those can also be dangerous for shoppers prone to racking up debt. For example, 26 of the cards surveyed by allow customers to avoid interest entirely if a purchase is paid in full by a specific date. If the balance isn’t paid off in the time frame, however, the cardholder will be responsible for paying back interest dating back to the original purchase date.

Ultimately, Bera suggests not limiting yourself to one retailer — unless you’re particularly loyal to that store and disciplined about paying your bill — because many traditional credit cards offer cash back and points that you can spend at several different retailers and on travel.

To see how the most popular retail credit cards stack up, check out this data from

NOW WATCH: Here’s how much money you actually take home from a $ 75,000 salary depending on where you live


Post Author: martin

Martin is an enthusiastic programmer, a webdeveloper and a young entrepreneur. He is intereted into computers for a long time. In the age of 10 he has programmed his first website and since then he has been working on web technologies until now. He is the Founder and Editor-in-Chief of and Online Magazines. His colleagues appreciate him as a passionate workhorse, a fan of new technologies, an eternal optimist and a dreamer, but especially the soul of the team for whom he can do anything in the world.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.