What Are Store Credit Cards?

Before applying for a store card, understand how it’s different from other credit cards and how it might affect your credit


You’re at the checkout to make your purchases. The store assistant says you can get rewards on the spot if you pay with the store credit card. You just need to apply and be approved for it. What do you do?

A store credit card can offer you savings and perks now and in the future. But before you decide whether to apply for one, read on for tips to help you make an informed decision.

How Are Store Credit Cards Different From Other Credit Cards?

Store credit cards, sometimes called retail cards, can be a lot like any other credit card you might come across. Like all credit cards, store cards are examples of revolving credit. With revolving credit, you can make purchases and pay down the balance later in a billing cycle. And if your card issuer reports your use of the card to the credit bureaus, your card should appear on your credit reports.

But depending on the card, there are some ways your store credit card might be different from other credit cards. 

A big factor to consider is what type of card a store offers. There are generally two types of store credit cards: private label and co-branded general purpose. If you’re interested in applying for a store card, it helps to know the difference:

  • Private label store cards: Typically, this kind of card can be used only at the store or group of stores it’s associated with. And any rewards you earn might also be tied to purchases at those stores.
  • Co-branded general purpose store cards: Co-branded store cards can usually be used anywhere that accepts the payment network shown on the card. In addition to earning elevated rewards at the store or group of stores, co-branded cards may also offer the opportunity to earn outside of the store.

Certain store cards may not seem any different from any other credit card in your wallet. Taking a closer look at things like rewards, credit limits and interest rates that are offered can help you compare cards.

What Are the Benefits of Store Credit Cards?

A store credit card—like any other credit card—can be a great financial tool when used responsibly. Here are some benefits it could offer you:

  • It could earn you rewards. Using a store credit card in the store it’s associated with might earn you better rewards than using a traditional rewards credit card in the same store would. Plus, some store cards offer extra bonuses like discount coupons and invitations to events.
  • It could help you build credit. With consistent responsible use over time, store cards could help you build credit just like any other credit card account does.

Are Store Credit Cards Good for Credit?

Like all types of credit cards that are reported to credit bureaus, store credit cards can affect your credit scores depending on how you use them. That’s why it’s important to use any credit card responsibly. Here are some ways that having and using a credit card, such as a store card, could affect your credit scores:

  • Payment history: Your payment history shows how well you’ve done with making payments on time. The better your payment history, the better your credit scores might be.
  • Credit utilization: Credit-scoring models generally pay close attention to your credit utilization ratio. This is a measure of how much of your available credit you’re using. Experts recommend keeping your overall credit utilization ratio below 30%.
  • Credit mix: Credit-scoring models also take into account the variety of credit accounts you use. A store credit card could add to your proven experience handling different types of credit.
  • Recent applications: New credit applications typically trigger hard credit inquiries. This is when a lender checks your credit reports to decide whether to approve your application. A hard inquiry can make your credit scores drop—usually by just a few points. But having too many hard inquiries in a short period of time could have a bigger negative impact.

When to Consider a Store Credit Card

Applying for any type of credit needs careful consideration. And it’s important that you take into account your unique financial situation. Here are some instances where you might want to consider applying for a store credit card:

  • If you shop at the store a lot. Loyal shoppers will likely benefit the most from store credit cards. If there’s a store you really like or purchase from over and over again, a store card might snag you the best rewards and cardholder benefits. 
  • If you understand the terms of the card. Understanding the terms of your credit card—including credit limit and interest rates—can help you better manage your account and build and maintain your credit. 

Use Store Credit Cards Responsibly

Remember, like with all credit cards, it’s how you use store credit cards that can make a difference to your credit. This can be positive or negative. 

Like other credit cards, store cards can be a great financial tool when used responsibly. And, depending on the card, they can offer discounts, exclusive benefits and access to experiences that aren’t available to the general public.


Learn more about Capital One’s response to COVID-19 and resources available to customers. For information about COVID-19, head over to the Centers for Disease Control and Prevention

Government and private relief efforts vary by location and may have changed since this article was published. Consult a financial adviser or the relevant government agencies and private lenders for the most current information.

We hope you found this helpful. Our content is not intended to provide legal, investment or financial advice or to indicate that a particular Capital One product or service is available or right for you. For specific advice about your unique circumstances, consider talking with a qualified professional.

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