You have probably been approached for signing up for a credit card at a store during the time that you are shopping. Commonly you are offered a discount on the purchase if you sign up for their offer. Signing up for a departmental credit card is usually discouraged as they have high interest rates. In any month you end up carrying a balance from one month to another, you will be paying a much larger sum of money is interest than you would on a regular credit card.
However, it is a fact that the approval process for a departmental credit card is simpler and easier than a regular credit card. If you have not been able to get a credit card from your own bank, you can sign up for a departmental credit card just as a way to kick start your credit history. As long as you make it a point to pay their balances in full at the end of every month, it will work pretty much the same way as any other credit card.
Since the limit on most of the departmental credit cards is low you will have to spend discriminatory and keep the balances below three per cent in order to have the maximum benefit on your credit score.
Don’t use a departmental credit card for the purposes of frivolous and extensive spending. Use it with the purpose of building a credit history till the time that you can get yourself approved for a regular credit card. Check if the card comes with any extra fee or charges. Are you going to be charged a redundancy fee if you do not use the credit card for a certain duration of time?
Always ensure that the gas or the departmental credit card is reported to the national credit bureaus, Equifax, Experian or TransUnion, all of them or at least one of them. If it is not, you should not choose it for your first credit card because using it will not do anything to build your credit history and not help you qualify for a conventional credit card in the future.