Bank Better, Live Better

credit cards or retail accounts, which is better?

Credit cards and retail accounts make it possible for us to buy these items when we need them, and then pay them off in instalments. But which is better?

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Use a credit card and consolidate debt

It may be easier to budget and do sensible financial planning if you have fewer credit accounts. If you have many retail accounts, it is harder to keep track of expenses, and you are more likely to fall into the debt trap.  


Limit temptation 

You may be less likely to do impulse buying if you do not have a retail account. One line facility in the form of a credit card can help limit temptation that comes in the form of sales and promotions. Just be sure not to use your credit card for unnecessary purchases either!


Pay lower interest rates with a credit card 

Depending on the amount of credit you apply for and the time you choose to repay it, credit cards can offer substantially lower interest rates than the average retail account. The Capitec Global One credit card, for example, offers interest rates from 10%, whereas most retailers charge a mandatory interest rate of 21% after an initial interest-free period. 


Earn interest with a credit card 

Most credit cards also offer a 55 day interest-free period if you choose the straight charge option. This means you pay no interest if you service your debt and repay credit during that time. With a Capitec Global One credit card, you actually earn interest on a positive balance, which can potentially cover your monthly service fee. 


Online purchases 

Credit cards allow you to take advantage of online promotions and do secure online payments. They are also useful for travelling abroad. You can book low-cost flights and car rentals online, as well as take advantage of online hotel promotions. With a Capitec Global One credit card, you can do cashless payments when travelling abroad without paying additional currency conversion fees.


If you earn a minimum salary of R3 000 or more and is over the age of 18, you can apply for a Capitec Global One credit card. The card is issued immediately for an initiation fee of R100 and a monthly account service fee of R35. The amount of credit you are given, depends on your credit record and affordability.

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