Kitchens by Riland

Today it is easier to find credit cards with no annual fee. Some credit cards waiver annual fees as an introductory offer and may remain so for a given duration so decided by the issuer. Many college student credit cards also do charge annual fee either as an offer or permanently so to encourage college students to hold credit cards. Other credit cards allow longer grace periods, say six or seven months. Purchases do not attract any interest for the said duration and only begins to attract after that specified period elapses. Another category of credit cards with no annual fee are those targeting high class customers who spend a lot on and using their cards and pay promptly.

There are many reasons which make credit card issuers issue some credit cards with no annual fee while the same issuer issues some with annual fee. They are all business decisions and designed to attract some sections of the credit card market to either hold and or use a certain credit card. In the case of college student credit cards which target those still learning, it is understood that making them pay annual fee may be prohibitive in which case it is better to let them used given that they also considered low risk category. They are a low risk category because many of them still depend on their parent and have not started buying very expensive items and even when they get into trouble their parents will certainly come to their rescue.

The issue of credit card with no annual fee apparently is not without conditions. When it targets credit card holders with higher income, the basic assumption is that their spending on credit cards will cover the need for annual fee. In other words it the principle of the economies of scale. It happens with college student credit card and premier credit cards. Where it annual fee is waived as an introductory offer, the purpose is actually to get the holder on board and hope that their coming on board will be more profitable in the long run if the waiver may achieve that goal than if they did not use the particular credit card at all.

Even credit cards which do not charge interest on purchases within the first six or seven months have considered that it is better if customers tried to pay within a much shorter duration before interest comes into effect.