Difference Between Charge Card and Credit Card

Edited by Diffzy | Updated on: April 30, 2023


Difference Between Charge Card and Credit Card

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Cards are not new to the financial world. Six of every ten people in today's usages use these cards to spend on different purchases and requirements. Charge cards and credit cards are in this matter for long terms. Though they are similar in usage and purpose, their motives and goals vary.

When you have a good credit score, then you can scope on to get a charge card or credit card. Be tricky in handling these cards wisely. Here are some differences and comparisons to make it easier in choosing a better card and spot the best credit score.

Charge Card vs. Credit Card

Nothing is similar when the main difference is a better cause. A charge card is more particular in collecting the fee and receiving payments at a given time. Whereas a credit card gives you a better period to repay your dues. Eligibility is required for a charge credit card. A charge credit card offers you no interest rates or low, and also your spending limit is not fixed.
Credit cards are issued by some popular or local banks and companies. Whatever the card is, be cautious with the terms and conditions for a better and healthier credit score. For sure, these cards offer more rewards and cashback. Credit cards can be able to carry your payment balance for the next month in case of a lack of money.
However, note that credit card companies can charge extra interest for the revolved balance. The rewards and cashback can be valued only if you hold some membership policy in some companies. The spending limit can make a big difference between these cards.

Difference Between Charge Card and Credit Card in Tabular Form

Parameters of Comparison       Charge Card Credit Card
Payment Duration A charge card restricts you from paying the payment within one month of the usage. With a credit card, you can arrange your payment for the future months by paying some small per cent of the amount
Economics Collects high annual fees and high late fees. Generates revenue through interests collected. Paying the due with better instalments and revolving methods
Purpose Offering huge buying options without interest. To help the middle class with low interest and better instalments.
Risk Factor Buying high priced things and not paying the due.  Misusing the card by some poor knowledge people.
Rewards You can get high rewards after paying the due within time. Similar to that of charge cards reward may be applicable.
Credit Limit You don’t have any credit limit. Credit cards come with some credit limits, but you can increase them after a few healthy payments.
Pros Cards offer you high rewards and credit limits.              Better instalment options than charge cards
Cons High annual fee than credit cards.  

Not every store or firm can offer you card usage.

Huge frauds on credit cards by some fake people.

What is a Charge Card?

A charge card is simply defined as a card that requires full payment within the month of usage without any interest. It's a type of electronic payment card, but typically only a few users are allowed to issue it. Charge cards will charge a high annual maintenance fee. 

A charge card has no spending limits for its users. A charge card may not be included in the common cards list because of its unique features. A charge card is one of the branded cards with luxurious aspects. As with other cards, a charge card also affects your credit score, in the case of late payments.

Few Famous Charge Cards

American Express is the most popular charge card to offer their customers and market. They expect a very good credit score from the users for issuing the charge cards. All the below cards are not interest-based and give us great rewards.

The Platinum Card from American Express

This is one of the top rewarded cards to offer you huge rewards. On spending more than $5000, and an American Express card offers you 60,000 points. One of the notable rewards is their annual fee charge on different basis like travel and shopping, i.e., around $2000.

American Express Gold Card

This gold card provides you with better spending opportunities than the platinum card. If you can spend more than $2000, it offers you perks of 25,000 points. Select the card according to your needs of usage. 

American Express Green Card

The American Express Green Card is the basic charge card for the initial users. If you are a user of the world of charge cards, you can apply and go with this card if eligible. Read all the terms and conditions before further processes.

Advantages of a Charge Cards

  1. You don't require to pay any interest until your billing time.
  2. Offers auspicious rewards like purchase points, great cashback, statement credits and even huge discounts on different spending.
  3. If you pay your bills earlier, you can increase your credit score.

Disadvantages of Charge Cards

  1. They charge high annual fees.
  2. Charge credit cards give their cards to only a few users.
  3. You have to pay the whole amount, event, it is huge in value.

What is a Credit Card?

Credit cards have been a common thing in our daily financial usage. Where ever you go many of us purchase things using credit cards. Credit cards have been in use since 1920. The first universal credit card was introduced by the Dinner Club in 1950.

Banks and companies charge annual fees and bills regularly. Bank credit cardholders are allowed to pay their bills every month, with which banks can earn a small rate of interest from the bills paid. You can be suggested to get a credit card for better and longer payments.

Types of Credit Cards 

It's not that important to know about every type of credit card on the market. But it's very important to know about the card which you are using and also to select a better card as per your requirements. Find the details of different types of credit cards below.

Reward Giving Credit Cards

Reward credit cards give a few points or even some per-sent cashback to your account when you spend or buy something using these credit cards. Additionally, different categories offer you more rewards than some other stuff like groceries and electronics.

The rewards can be used for future shopping discounts and you can even drag them into your bank accounts. For much clarification, get your banker for better assistance. Search for a better card if your aim is not about rewards.

Top Cash Back Credit Cards

Cashback credit cards are best for some particular niche categories selectively. Some brands allow you more discounts with existing offers when you have cash-back credit cards. Different stores can be in different percentages of cashback.

Travelling Credit Cards

Travel is the most trending and exciting move in today's life. Whatever it may be, the reason for your travelling may be for business or personal. Thai travel credit cards offer you existing offers on flight charges and the hotel booking process. 

It will be more suggestible to get the card if you are a person who likes to travel the world. So, make use of your travelling with more travelling rewards.

Balance Withdraw Credit Cards

Very few bank cards announce these types of cards. If you have had huge debts for a long time, then you can get this card for free of interest. But you need to pay the amount before due so that you can maintain a healthy credit score. Don't withdraw more than you can afford to repay.

Low or No interest credit cards

Interest is one of the big words for all card users. Very few cards offer low-interest rates, even after you haven't paid the dues. These low-interest credit cards will find you better for your usage. Credit cards in this category can be like a big deal if you want to purchase a huge and costly product with low rates of interest. Use these cards for a fine purpose.

Business Holders Credit Cards

They allow the cardholders and help them to keep their business allowances and expenses separate, with the earning of business rewards too. On the other hand, these cards offer you better cashback. A good business credit card helps you to track the reports very easily. So, you will need a business or income-producing asset to get eligible for this card. 

Student’s Credit Cards

Student credit cards are the initial credit cards for any beginner in their life. These cards are designed for the growth and financial support of young students. Many students' credit cards won't charge any annual fees or extra charges. If you are a student, who can use this card responsibly, then you can create better financial support.

Store Credit Cards

Store credit cards are offered by retailers or store owners. So, consumers can buy products and pay over time. However, some cards will restrict you from using these cards only in their respective stores. Be mindful of the different interest rates with these cards, when you cannot repay the sum, you have to bear their high-interest rates until you clear the dues.

Top Co-Branded Credit Cards

Co-branded credit cards are offered by top-class brands to buy their products regularly. For example, airline credit cards can be used in hotels and at airports. Other than limited rewards and cashback, these are similar credit cards to other ones. Many co-branded credit cards are partnered with local retail shops and popular malls to offer easy transactions.

Secured  & Safe Credit Cards

Few credit cards are safe on the market, but many others are unsafe. The transparency with the user is very low. By using these secured credit cards, you can avoid most of the most unusual threats from hackers. The approval of secured credit cards might be sort of easier than any other card. You can build everything from scratch and maintain a healthy credit score.

Advantages of Credit Cards

  1. A credit card offers you easy monthly instalments and low interest for quick payment users.
  2. Low annual fee with some best rewards
  3. You can use a credit card at any respective store, easily.

Disadvantages of Credit Cards

  1. High-interest rates for revolving the payments for the next months.
  2. Can lead to high liquidity in spending at different stores.
  3. Some fake users can misguide you in handling these credit cards.  

Main Differences Between Charge Card and Credit Card in Points

  • A charge card is also a type of credit card, but the features make some minor differences.
  • A charge card requires full payment of the amount at the end of the billing period, whereas a credit card's bill payment can be shifted to the next month by paying a low amount for the present month.
  • Very few applications are selected for the issue of charge cards, but credit cards attract people to get their cards based on their credit scores.
  • The annual fee is less on credit cards and much higher on charge cards.
  • Limited retailers or shop owners offer you to pay the bills with charge cards other than credit cards.
  • High-interest fees for late payment on both cards.                                                               


Many features and aspects attract you to select the best card for your needs. According to many great financial advisers, no matter a charge card or a credit card, both are best if you can repay the dues within time. However, if you want a bigger hand in spending then go with a charge card. So decide on the card based on your wallet weight.

Similarly, if you are a medium spender of money and you want to repay the dues for a longer period, get a credit card. Also, you can use your charge card as a credit card, too. Think twice and create your best decision wisely. All the best for your healthy financial and credit score.


  • https://www.forbes.com/advisor/credit-cards/charge-card-vs-credit-card/


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"Difference Between Charge Card and Credit Card." Diffzy.com, 2024. Sat. 18 May. 2024. <https://www.diffzy.com/article/difference-between-charge-card-and-credit-card-71>.

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