The benefits of a basic credit card

You can manage finances and minimize costs with a basic credit card.

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Basic credit cards often come with no annual fee and offer fewer perks and benefits than their counterpart credit cards that do come with an annual fee. But basic cards can still be worthwhile as you could use them to earn rewards or save money on interest. There are many reasons why such a card might be right for you, but it’s first important to understand how basic credit cards work.

What is a basic credit card?

As the name suggests, this type of card comes with basic features, such as low-interest rates or $0 annual fee and with little or no additional features. The following types of basic credit cards are commonly available:

Low-interest rate credit cards

Low-interest rate credit cards are designed to save you money otherwise lost to interest fees. With average credit card APR hovering around the 16% mark, low-interest rate credit cards can save you a substantial amount of money by offering APR in the 10% region.

Some card promotions even bring that down to 0%, albeit only for a promotional period of up to 21 of months. These cards are best suited for cardholders who regularly use their cards but who take a while to settle their balances.

No-annual-fee credit cards

No-annual-fee credit cards offer administrative savings on your credit card, either for the life of the card or for the first year only. You’ll find different credit card types with no annual fee, including balance transfer, rewards, airline credit cards and travel cards.

No-annual-fee cards are most suitable if you rarely use your credit card and paying an annual fee would not be worthwhile.

Compare no-annual-fee credit cards

Name Product Annual fee Balance transfer APR Purchase APR Filter values
Citi Simplicity® Card
0% intro for the first 21 months (then 14.74% to 24.74% variable)
0% intro for the first 12 months (then 14.74% to 24.74% variable)
With an intro APR of 21 months, this card has one of the longest balance transfer offers on the market. Plus, no late fees and no annual fee.
Citi® Double Cash Card
0% intro for the first 18 months (then 13.99% to 23.99% variable)
13.99% to 23.99% variable
This one of the most valuable flat cashback cards. It comes with 2% cash back (1% when you buy plus 1% when you pay) and 18 months months to pay off transfers.
Blue Cash Everyday® Card from American Express
0% intro for the first 15 months (then 12.99% to 23.99% variable)
0% intro for the first 15 months (then 12.99% to 23.99% variable)
Earn a $150 bonus statement credit after you spend $1,000 on purchases in the first 3 months. Rates & fees
CardMatch™ from
See terms
See issuer's website
See issuer's website
Use the CardMatch tool to find cards you're likely to qualify for with your credit score, without a hard pull on your credit.
Citi Rewards+℠ Card
0% intro for the first 15 months (then 13.49% to 23.49% variable)
0% intro for the first 15 months (then 13.49% to 23.49% variable)
Get rewards on gas and groceries with no annual fee. Ideal for everyday use, it's the only card that rounds purchases up to the nearest 10 points.

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The pros and cons of a basic credit card


  • Cheaper to maintain.
    You will be saving money immediately with no annual fees.
  • Lower interest fees.
    Interest fees can represent the largest cost when it comes to credit cards, so having a card with low or no interest fees can translate into substantial cost savings.
  • Less temptation to spend.
    Having a lower reward earning means you won’t be tempted to spend unnecessarily.
  • Less possible debt.
    If you have a lower interest rate on purchases, you’re more likely to be able to repay your balance in full and avoid falling into debt.


  • Limited extra features.
    If you’re after the premium complimentary treats, such as lounge access, companion certificate or travel credit, a basic credit card might fall short.
  • Less value.
    Depending on what sort of spender and cardholder type you are, you may find that basic credit cards offer less value in terms of features and privileges. If you are a big spender and frequent traveler who always pays off your monthly account balance in full, you’ll probably get more value from using a premium airline credit card even if you’re paying an annual fee for it.
  • Less available credit.
    Although it’s not always the case, basic credit cards tend to have lower credit card limit than premium cards.

Bottom line

Basic credit cards can be beneficial and cost-efficient for some people, but will not be suitable for everyone. If you’re looking for the best card to suit your needs, compare your credit card options until you find what you’re looking for.

Images: Shutterstock

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