What is a Credit Card & How Do They work?
Credit cards explained
A credit card could be a convenient and flexible way of borrowing money. Credit cards allow you to spread the cost of your purchases over time.
Before you apply for a credit card, it's important that you know about what it could cost you to use it, and that you only borrow what you can afford to pay back. To get the most out of your credit card, it's crucial that you're able to meet your payment dates – and pay what you owe in full every month.
Whether you’re used to credit cards or it’s all new to you, it’s always a good idea to think about how you manage your account. These short videos can help.
What is a credit rating and how important is it?
Your credit history gives lenders an idea of how you’ve handled your finances in the past – and helps them assess your application.
So whether you’ve recently been turned down for credit or just want to apply in the future – take a look at how credit reference agencies use your information and how you can help improve your credit rating.
How can I improve my credit score?
A good history and credit score help to get lenders to say yes to your application. That’s why it’s so important to understand what can affect it.
We’ve got lots of information to help build your credit rating and you could try our Credit Builder tool to get simple and personalised hints and tips just for you.
Choosing the credit card that's right for you
If you want to use a credit card to borrow money to buy things, make sure you’ll be able to pay at least the minimum monthly payments. You should always make sure that you understand the fees and interest rates, including the purchase rate.
Bad credit and how you can help avoid it
Having ‘bad credit’ makes it harder for you to get access to the credit you need. So you’re more likely to get turned down for things like mortgages, credit cards and loans.
But what causes bad credit and what should you do if you’re worried about it?
Farzana, a mother of five, tells us why she applied for her first credit card
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Watch Carly explain to Maya about applying for her first credit card
Viewing time: 1.38
Stay on top of your spending
Credit cards are a convenient, flexible way to make purchases when used sensibly, but it’s important you stay on top of your spending – and we offer a range of ways to help you take care of your account. Whether it’s managing your money on the go, or setting up a Direct Debit, we make things simple and straightforward.
Understanding your credit card costs
Here are some of the costs of credit cards explained. If you’re interested in a particular card, you’ll find more specific charges in its terms and conditions or card summary.
What to do if your credit card application is turned down
Your credit history gives lenders an idea of how you’ve handled your finances in the past – and helps them assess your application.
So whether you’ve recently been turned down for credit or just want to apply in the future – take a look at some of the simple ways you could help improve your credit history.
Eligibility checker
Before you apply check how likely you are to be accepted, without affecting your credit rating
Jargon buster
A glossary of all the key terms you'll encounter when exploring credit