What is a charge card?

Charge cards have no set spending limit and require that you pay your full balance off by the statement due date, which is usually at the end of the month. A charge card is not a revolving line of credit and doesn’t charge interest like traditional credit cards. Instead, you are charged a late fee if you don’t pay on time. The structure and payment requirements of charge cards also mean that they tend to have higher minimum income and credit history requirements than some credit cards. Charge cards often come with rewards, travel insurance, airport lounge access, concierge services, and purchase and fraud protection.

Charge cards vs credit cards

Frequently asked questions

• How much can I charge to a charge card?

  People have been known to pay for half-million-dollar supercars on their charge cards. However, charge cards are not always limitless, and purchases are approved based on established spending patterns, credit ratings, repayment history and declared financial resources. As you develop a relationship with your charge card provider, the amount chargeable to your card may increase.

• Can I get supplementary charge cards for my family or employees?

  This is usually possible, as long as the nominated family member satisfies the card provider’s requirements, such as being over 18 years of age. You, as the main cardholder, are completely liable for additional card spending.

• Can I get a charge card if I had a payment default on my credit report that has since disappeared?

  Depending on your card provider’s stipulated requirements, this might or might not be possible. For instance, American Express explicitly requires a declaration that “I have no history of bad debt or payment default”.