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Credit card companies don’t alway make it easy, but there are ways to pay your credit card bill with your debit card. To use your debit card to pay a credit card bill, you must do so via bank transfer payment. In other words, you have to use either a credit card provider’s payment portal or a third-party payment portal that includes not only your debit card information, but also your banking information.

Keep in mind, however, that credit card companies usually prefer to receive payment funds from the customer’s bank account over a physical debit card. Many credit card providers simply don’t accept monthly bill payments with physical debit cards, but they will allow debit card payments if you play by their rules. That may change the way you may use a debit card to pay a credit card bill, but it doesn’t mean you can’t do it.

Can You Pay a Credit Card With a Debit Card?

You might be able to pay a credit card with a debit card. Whether you can do so really depends on the credit card provider’s policy on debit card payments — some credit card policies allow for them and others don’t.

Consequently, you may have to go out of your way to get the job done. When you go to pay your credit card bill, there likely won’t be an option to enter a card number as a method of payment, whether that card is a credit card or a debit card. In most cases, however, you can pay your credit card bill with the bank account that the debit card is attached to by making an electronic transfer.

Recommended: Tips for Using a Credit Card Responsibly

How to Make a Credit Card Bill Payment (Indirectly) With a Debit Card

Even if you can’t use a debit card to directly pay a credit card bill, you can indirectly use a debit card — or rather the funds attached to that debit card — to pay your outstanding credit card debt. Here’s how:

1.    Review your checking account, and get the bank routing number and checking account number. Do so privately and securely, so as not to attract financial fraudsters.

2.    Go to your credit card account to set up automatic payment. A handy feature of how credit cards work, this will allow money to be withdrawn from your bank account ahead of the monthly payment due date. On that date, the credit card company will withdraw the specified cash amount from your bank account.

3.    Make sure you have enough cash in your bank account to cover the withdrawal. If you don’t, your credit card company will reject the payment. It’s up to you to reach out and make good on your monthly credit card payment that’s due. Any delay in doing so could result in a missed or late payment, which could have financial consequences.

Recommended: When Are Credit Card Payments Due

Paying a Credit Card Bill With a Debit Card Online

If you’re using a debit card to pay a credit card bill online, you’ll need to make that payment through the credit card’s payment portal. The good news is that credit card companies may accommodate online debit card payments.

Once you’ve signed into your credit card account, you’ll be given several options to pay your bill. The most common methods include ACH bank payment, a third-party payment platform, over the phone, or with your debit card.

Simply click on the debit card payment option and fill in your card details (this should only be a one-time occurrence as your debit card information should be securely held by your credit card provider in its payment portal.)

Once your debit card information is accurately entered, review the payment and hit “send.” Your payment should be confirmed immediately by the card carrier, and the money will leave your debit card account within 24 hours or so.

Paying a Credit Card Bill With a Debit Card Offline

Credit card companies likely allow you to use your debit card to make a credit card payment by phone, in person, and sometimes through the sponsoring bank’s ATM.

Make sure you have your debit card on you before paying at any bank or over the phone. If even one digit is wrong, the payment won’t go through, and you’ll have to revert to another form of payment to cover your credit card debt.

Are There Any Downsides to Paying Your Credit Card Bill With a Debit Card?

The fact is, while credit card companies will accept debit card bill payments, it’s not their preferred form of payment. It’s easier for credit card carriers to process bank ACH payments or third-party payments through platforms like PayPal, which handle the process for the card company. As such, you’ll have to jump through hoops or go an indirect route, similarly to if you were to try to pay credit card statement with another credit card.

Further, debit card payments may be prone to various outcomes that credit card companies don’t like. This includes scenarios such as the cardholder not having enough money in their account to cover the credit card payment or the fact that debit cards are common targets of financial fraudsters. In fact, a key difference between a credit card and debit card is their levels of payment protection.

The Takeaway

Just because you can use a debit card, even in limited fashion, to pay your credit card bill doesn’t mean you should. To keep payments flowing smoothly and to protect your debit card (and your bank account), it’s likely a better move to pay your credit card bills via bank ACH transactions, or through secure third-party payment processors. That way, your payment still originates from your bank checking account — only without the potential payment and security headaches that may come with using a debit card to pay a credit card bill.

FAQ

Can I pay a credit card online with a debit card?

Technically, yes, you can pay your credit card bill with your debit card. However, it may take some extra steps to do so.

Can I pay my credit card at an ATM with a debit card?

Yes, you can use a debit card at an ATM to pay a credit card bill — but only an ATM from the bank that offers the credit card.

Are there extra charges for paying a credit card with a debit card?

You generally won’t face any extra charges for paying a credit card with a debit card. You may simply have to jump through some extra hoops to do so.

Can I pay my credit card bill with someone else’s debit card?

While this is technically doable, it’s not advisable. Using another party’s debit card to pay a credit card bill can get complicated, especially if you’re not certain the other person’s bank account has sufficient funds to cover your balance.

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¹Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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A price protection credit card benefit offers a limited lowest price guarantee on your purchases. If an item you purchased is advertised at a lower price than you paid, then you might be eligible for a refund of the difference if you paid using a credit card with price protection.

Although the idea seems straightforward, price protection credit card clauses aren’t as simple due to differences between card programs. Here’s a closer look at what price protection is and how it works.

What Is Credit Card Price Protection?

Credit card price protection is a card benefit that some programs offer their cardholders. It guarantees that if an eligible item you purchased using your credit card is advertised at a lower price, the card issuer will refund you the price difference.

To receive the funds, you’ll have to file a claim asking to be refunded — it won’t automatically get deducted from your credit card balance. It’s also up to the cardholder to be on the lookout for price fluctuations.

Recommended: When Are Credit Card Payments Due

How to Use Price Protection

Credit cards with price protection are most advantageous when used toward a good that commonly changes in price. For example, this could include electronics, clothing, and other items that often go on sale.

There are also a few things to keep in mind when it comes to how credit cards work with price protection. For starters, to use price protection, the lower-priced item must be the exact specifications of your original purchase. This includes the product manufacturer, model number, and year it was released.

You’ll also need to ensure that the reduced price was advertised within the program’s specified timeframe, which is usually anywhere from 70 to 120 days. Plus, you’ll need to file a refund request within the allotted claim window.

Questions to Ask Issuers That Offer Credit Card Price Protection

If you’re specifically looking for a credit card with price protection, make sure you know all of the terms associated with this benefit. Contact the card issuer upfront to get clarity about the eligibility requirements for filing a price protection claim.

What Items Are Eligible for Price Protection?

The range of items that are eligible for price protection under your card’s benefit program can be quite broad. For example, home goods, furniture, clothing, footwear, kitchenware, bedroom linen sets, pet accessories, and more might qualify under your price protection credit card.

What Items Are Not Eligible for Price Protection?

Below are some examples of goods that might be excluded from price protection, depending on your benefits program:

•   Animals

•   Antiques

•   Bespoke or one-of-a-kind items

•   Cash-only purchases

•   Collector items

•   Food and beverages

•   Discontinued items

•   Jewelry

•   Limited edition items

•   Live plants

•   Original artwork

•   Perishable goods

•   Tickets

•   Services and related costs

•   Vehicles

•   Watches

Further, items purchased at liquidation sales, storewide sales, or online might not be eligible for price protection. Also note that price protection isn’t the route you take if you’re simply unsatisfied with the service or product you received. In that scenario, you’d request a credit card chargeback.

Recommended: What is a Charge Card

Guide to Filing for a Credit Card Refund

If the advertisement you’ve found shows a lower price than what you paid for your original purchase, and your situation fits your credit card price protection requirements, you can submit a claim for reimbursement. To do so, you’ll generally need to go through the following steps:

1.    Save the lower-priced advertisement. Retain the original physical ad that shows the product’s name, merchant or retailer, price, and date, if applicable.

2.    Find your original receipt. The purchase receipt for the item you bought should include the merchant’s name, date of purchase, item, and price. It should also show that you used the credit card with price protection. You might also be asked to supply a copy of your statement that has the original purchase on it.

3.    Submit a claim. Contact your card’s Benefits Administrator, or call the number at the back of your card, to file a claim for a price protection refund. Make sure that your claim is submitted within the eligible claim period.

4.    Review your balance. Check your credit card balance or statement to confirm that the refunded amount is correctly reflected on your account.

How long a credit card refund takes depends on your card issuer and its processing timeline. Generally, it can take three to seven business days to see a refund posted to your account’s balance.

How Long Do You Have to File for a Credit Card Refund?

The timeline you have to claim a credit card refund under price protection varies between credit card programs. Some cards allow you to file claims up to 70 days after your purchase date, while others give you up to 120 days from your purchase date.

Additionally, some benefits programs require that the advertisement date is within a certain number of days of your original date of purchase. Make sure to confirm the ad date requirement under the credit card price protection benefit, as well as the deadline to file a formal claim.

Is There a Limit to Reimbursement Through Price Protection?

Another restriction you might encounter for cards with price protection is the minimum and maximum refund limit per item. For example, your card might impose a minimum refund threshold of $10 up to a maximum refund of $250 per item. It also might have an annual reimbursement limit, which caps the total refund amount you can receive in a year.

If you want to file a refund claim under your price protection benefits, check your credit card’s benefits guide to learn about its specific requirements.

Recommended: What is the Average Credit Card Limit

Tips for Saving Money Without Credit Card Price Protection

Using a credit card with price protection isn’t the only way to save money when prices are reduced. Here are some other possibilities for saving:

•   Look for same-retailer price adjustments: Some retailers offer a price adjustment if you recently purchased an item in their store, and the same item is marked down at the same store not too long afterward.

•   Find price matches. To outprice their competitors, a retailer might offer a price match or lowest price guarantee. If you find the exact item elsewhere at a lower price, it will offer to match the price or offer a credit card refund for the difference if you’ve already purchased the item at their store.

•   Catch items on sale. Track upcoming sales, like a retailer’s annual sale or holiday sale, that offers a large discount off of the retail price. If shopping online, using an online price-tracking tool can help you find the lowest price.

•   Keep an eye on your credit card statements. While not necessarily a guaranteed path to savings, regularly reviewing your credit card statement can help you catch any charges that aren’t right, whether due to fraud or getting charged incorrectly. In those instances, you could dispute a credit card charge to attempt to get your money back.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

The Takeaway

A price protection credit card offers peace of mind when purchasing goods that might fluctuate in price. Aside from applying to tangible goods, you can take advantage of price guarantees for travel-related purchases like hotel rates, which can change daily.

When you use the SoFi Credit Card to book your hotel accommodations through Mastercard Travel & Lifestyle Service, you’re covered by its Lowest Hotel Rate Guarantee. It refunds you the difference if you find the same stay for less. Plus, you’ll earn cash-back rewards on all eligible purchases. Learn more and apply for a credit card with SoFi today.

Apply for a SoFi Credit Card now.

FAQ

What is price protection on a credit card?

Price protection allows cardholders to claim a credit card refund on a price difference if a lower published price becomes available. Typically, price protection is available for a limited period after the original purchase was made.

Do all credit cards offer price protection?

No, not all credit cards offer price protection. Card benefits, like price protection, vary across card issuers and credit card programs. See your card agreement to learn more about your card’s benefits and terms.

How can I use price protection?

In order to take advantage of price protection, you’ll first have to make a purchase using a credit card with price protection. Then, within the permitted time period, find the same product marked at a lower price. From there, you’d contact your card issuer to submit a claim for a refund in the amount of the difference between the two prices.

What is a price protection clause?

A price protection clause is the written parameters of your card’s price protection benefit. It states the issuer’s criteria for claiming the benefit, including the allowable time frame for a price protection request, eligible purchase categories, and more.

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Photo credit: iStock/jroballo

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

¹See Rewards Details at SoFi.com/card/rewards.

Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, a statement credit, or pay down eligible SoFi debt.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Credit cards are a convenient method of payment that let you make cashless purchases in-person or online. However, millions of Americans fall victim to credit card fraud, according to the Consumer Financial Protection Bureau.

Identifying fraudulent activity and knowing how to report credit card fraud can help protect identity and your finances. Here’s a closer look at the process of reporting credit card fraud.

What Is Credit Card Fraud?

Credit card fraud is a type of identity theft. When a perpetrator commits credit card fraud, they’re making unauthorized purchases or cash advances using a credit card account that isn’t theirs.

Types of Credit Card Fraud

Fraudsters have developed many types of credit card scams to infiltrate unsuspecting consumers’ credit card accounts.

Account Takeover

An account takeover involves the perpetrator contacting the credit card issuer to make fraudulent changes or requests to gain access to your account. For example, they might claim to be you and request a new credit card issued to their address.

Card-Not-Present (CNP)

Card-not-present, or CNP, credit card fraud occurs when an unauthorized charge is put onto a card account without the physical card being present during the transaction. This might occur during online purchases or other instances when a transaction is performed without the physical card in hand.

Credit Card Skimming

Credit card skimming occurs when a skimmer device is placed onto a legitimate credit card sales terminal. It’s designed to look seamless and authentic. Upon swiping your credit card through the skimmer, the device captures your account data, including your credit card number, PIN, CVV number on a credit card, and more. Perpetrators can then create a copy-cat credit card with your account information encoded into it.

Fraudulent Card Applications

This type of credit card fraud occurs when someone opens a new card account under your name without your consent and/or knowledge. Fraudulent applications might lead to newly opened credit card accounts through pre-approval mailers that are intercepted by fraudsters.

Lost or Stolen Cards

A lost or stolen credit card is another common method of credit card fraud. Unlike CNP, the perpetrator obtains possession of your physical credit card and makes unauthorized charges. If your card is lost or stolen and then used before you realize it’s missing, an unauthorized user can make fraudulent changes in person or online.

Recommended: What is a Charge Card

How to Detect Credit Card Fraud

A key way to uproot credit card fraud is by staying keenly aware of the activity on your existing credit card accounts. For example, with the convenience of automatic payments, it might be easy to ignore reviewing your monthly statement since autopay lets you pay your bills without much effort.

However, if you didn’t notice an unauthorized charge come through because you aren’t keeping track of your transaction activity, it can become that much harder to thwart further fraud. Additionally, routinely reviewing your credit reports can help you flag any new credit card accounts that you didn’t activate.

You might also consider setting up credit card alerts, which can notify you when purchases or cash advances are made using your card. You can set these up through your card issuer’s mobile app and opt to receive a text message, email, or push notification. These frequent updates can help you respond quickly if anything goes awry.

Recommended: Tips for Using a Credit Card Responsibly

How to Report Credit Card Fraud

If you’ve found fraudulent activity on your card account, there are steps you can take to minimize your liability for the unauthorized charges.

Contacting Your Credit Card Issuer

As soon as you notice a fraudulent charge, contact your card issuer’s fraud department immediately. Report the unauthorized charge and explain that it was made without your knowledge or consent.

Typically, the issuer will immediately deactivate the old credit card and reissue you a new card to avoid further unauthorized transactions. If you haven’t done so already, change your online password for the compromised credit card account. Also, change the PIN for your card.

Reaching Out to the Credit Bureaus

Contact one of the three credit bureaus to submit a fraud alert. Doing so requires businesses to verify your identity before opening a new credit account under your name. This fraud alert is free to request and remains active for one year.

The credit bureau you contacted is required to inform the other two bureaus of the fraud alert on your credit. Request a copy of your credit report from each bureau and review them for any other suspicious activity.

Notifying the Authorities

Report credit card fraud to the Federal Trade Commission through its website, IdentityTheft.gov , or by calling 1 (877) 438-4338. By reporting the fraud to FTC authorities, your rights in relation to the fraud are reserved. The FTC will file the report and come up with a recovery plan.

You can also choose to file a fraud report with your local police department. Request a copy of the police report for your records.

How to Protect Yourself From Credit Card Fraud

Following a few practical credit card rules can help you reduce your exposure to potential credit card fraud:

•   Review your credit card statements regularly.

•   Observe your credit card and bank transactions for anything that’s incorrect or potentially fraudulent.

•   Track changes on your credit report.

•   Keep your credit card information private.

•   Set up mobile alerts on transactions through your card issuer.

How Credit Card Fraud Can Impact Your Credit

Credit card fraud can do incredible harm to your creditworthiness if it goes undetected. It can result in a sudden uptick in outstanding balances, which impacts your credit utilization ratio and can adversely affect your score.

It can also be problematic to your credit if new credit card accounts were activated under your name without your knowledge. In this scenario, the unauthorized account and charges incurred go unpaid, which can negatively affect your payment history.

Recommended: When Are Credit Card Payments Due

The Takeaway

Reporting credit card fraud is essential to avoid being liable for unauthorized charges or changes to your account. Stay apprised of your credit card activity by reviewing your credit card transactions at regular intervals and routinely checking your credit report for suspicious issues.

If you’re looking for a fuss-free credit card, SoFi has a solution.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.¹

Take advantage of this offer by applying for a SoFi credit card today.

FAQ

What happens when you report credit card fraud?

Upon reporting credit card fraud on your account, the card issuer initiates an investigation into the unauthorized charge or fraudulent claim. It might reissue you a new card to use while it conducts its investigation. It if confirms that fraud occurred, your maximum liability for an unauthorized charge is $50, depending on when you reported the fraud and/or lost or stolen card.

What do I do if I suspect a fraud card?

If you suspect that you were a victim of credit card fraud, immediately contact your card issuer to notify them of the unauthorized activity. Request a copy of your credit report to confirm that no other suspicious activity is associated with your credit. Finally, file an identity theft report through IdentityTheft.gov or with local authorities.

Can the bank find out who used my credit card?

The bank can trace the details of the unauthorized activity. These details include the merchant where the card was fraudulently used as payment; the transaction date, time, and amount; and the buyer’s IP address.

How do I claim credit fraud?

To claim credit card fraud, contact your credit card issuer. You can call the phone number listed on the back of your card or call the issuer’s fraud department directly to report the unauthorized activity and request an investigation.

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Photo credit: iStock/Moon Safari

¹Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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With average credit card annual percentage rates (APR) topping 15% as of the second quarter of 2022, according to the Federal Reserve, savvy cardholders are looking for ways to reduce the cost of using a card. Some ways consumers achieve this is through a cash-back rewards credit card or a low-interest credit card.

The distinction between a cash-back vs. low interest credit card is that cash-back cards help you earn a small percentage of your spending back. Conversely, a low-interest credit card tends to charge less interest each month than a high-interest card, which is helpful for cardholders who roll a balance into the next month.

Recommended: Can You Buy Crypto With a Credit Card

What Are Cash-Back Credit Cards?

Credit cards that offer cash-back rewards are designed as an incentive to encourage spending on the card. For every eligible purchase you charge to your card, you’ll receive a small percentage of cash back. Some cards offer 1% cash back, while others offer as much as 8% or more, depending on the program’s rules. You might earn a flat rate across all purchases, or you might earn more in certain spending categories, such as groceries or gas.

You then can redeem your earned cash-back rewards. Redemption options may include a cash payment or a statement credit toward your next bill, or you may be able to redeem the rewards for travel, merchandise, gift cards, and more.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

What Are Low-Interest Credit Cards?

Low-interest credit cards incur a lower borrowing cost compared to a high-interest credit card. A credit card that charges low interest allows you to pay less for using the card if you carry a balance. This card feature is beneficial for cardholders who repay their monthly balance in increments over time, instead of in full.

The interest rate you qualify for highly depends on your creditworthiness, including your past borrowing habits and credit score. Consumers with strong credit might qualify for promotional no-interest credit cards that charge 0% APR for a limited period. After this period is over, the card’s interest rate increases, based on the cardholder’s credit and qualifications. As such, there are both advantages and disadvantages of no-interest credit cards.

Recommended: How to Avoid Interest On a Credit Card

Differences Between Cash-Back and Low-Interest Credit Cards

Below are the key differences between low-interest vs. cash-back credit cards to keep in mind when choosing a card:

Cash-Back Credit Cards	Low-Interest Credit Cards
You’ll generally need good credit to qualify.	Cash-back rewards offer an incentive for spending.
Cash-back rates vary by issuer.	Advantageous for those who don’t carry a balance.
Savings may be negated when a balance carries over.	Lowest APR offers are reserved for those with strong credit.
Advantageous for those who carry a balance.	Some cards offer a promotional 0% APR for a limited period.
Lowers the borrowing cost for carried-over balances.	Perks may be inconsequential when monthly balances are paid in full.

Factors to Consider When Choosing Between Rates and Rewards

Your unique financial situation, borrowing habits, and the features and benefits of a particular card are what you should consider when comparing your options.

Average Balance You’ll Be Carrying Monthly

How credit cards work is that they give you purchasing power up to a limited amount, even when you don’t have the cash upfront. You can choose to repay the debt in one lump payment by your statement due date, which allows you to avoid paying interest charges. Alternatively, you can make installment payments over multiple months, in which case you’ll accrue interest charges.

Not carrying a monthly balance is one of the common credit card rules to try to stick to, but it’s not always possible. For example, you might have had an unexpected injury that resulted in a medical bill that exceeded your cash savings. In this scenario, putting some of that cost on your credit card and making small, monthly payments to repay it might be necessary.

If you don’t have sufficient cash savings or income to confidently repay your monthly balance in full each month, a low-interest card might offer an advantage over a cash-back card.

Recommended: When Are Credit Card Payments Due

Your Average Monthly Spending

Look back at your monthly expenses and think about the total amount you’ll likely put on your credit card each month. For example, you might choose use a credit card to cover everyday expenses, like dining, groceries, and gas. Cardholders who rack up high monthly balances can benefit from a cash-back credit card that offers money back from purchases you’re already making.

The caveat, however, is if you charge more expenses to your card than you can realistically pay back in full by the statement due date. If you roll over any portion of your outstanding balance into the next month, you’ll get charged interest on that amount, which cancels out any cash-back rewards you may have earned.

Recommended: Tips for Using a Credit Card Responsibly

Annual Fees

Some cards — particularly rewards cards that extend high-value benefits and incentives — might charge an annual fee. For example, a cash-back card might offer an annual $300 travel credit and 5% cash back on flight purchases, but charge an annual fee of $550.

If you don’t travel enough to use up the credits and earn more cash back than the annual fee costs, that card might not be the best fit for your lifestyle. You’ll need to assess the total potential dollar value that a card’s benefits, credits, and other incentives offer in comparison to the upfront cost of the card’s annual fee.

Recommended: What is a Charge Card

Interest Rate Difference Between Cards

Although all credit card issuers check your credit to determine your interest rate, each card company has its own underwriting criteria. You might receive an interest rate offer for 13.99% APR for one card, and an offer from another card issuer at 11.99% APR, for example. To gauge interest rates, it can be helpful to look at the current average credit card interest rates for a point of comparison.

Regardless of whether you end up with a cash-back credit card vs. low interest credit card, it’s always a good idea to shop around for the lowest interest rate you can get. That way, if you ever need to carry a balance, you can minimize the amount of interest you end up paying.

Guide to Lowering Your Credit Card Interest Rate

Whether you’re shopping around for a new credit card or have an existing card with a high APR, here are some ways to lower your interest rate:

•   Contact your card issuer. If you’ve been a loyal customer and have kept your account in good standing, or if your credit score has improved since you opened the account, your credit card issuer may be willing to reduce your rate.

•   Raise your credit score. Even if you already have good credit, strengthening your credit score can help you secure the most competitive interest rate in the future. Good borrowing habits — like making on-time payments and keeping your credit utilization low — are just some ways that may help your score.

•   Consider a low-interest balance transfer card. If you have a high-interest card with a balance on it, and you have strong credit, a balance transfer card can allow you to move your original balance onto a low-interest card. Before proceeding, always compare the balance transfer fee against your potential savings to confirm that it’s worth it.

Remember, what’s considered a good APR for a credit card is subjective, based on your creditworthiness and other factors. Securing the lowest APR that you qualify for can help you avoid heavy interest charges if you roll over a monthly balance.

Explore SoFi’s Credit Card With Rewards

Ultimately, whether you opt for a cash-back credit card or a low-interest card depends on how you plan to use the card and whether you practice responsible credit card habits. But why choose one or the other when you can explore credit cards with low interest rates and cash-back rewards?

A SoFi Credit Card offers the advantages of a cash-back rewards credit card with the opportunity to lower your APR through responsible credit usage.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.¹

Take advantage of this offer by applying for a SoFi credit card today.

FAQ

When is a lower annual interest rate better than a low annual fee?

A lower APR is better if you typically carry a balance from one billing cycle to the next. When you roll over a balance, old and new balances accrue daily interest charges that can cost you more money out of pocket. A low annual fee is something to look for when you’re using a card to earn incentives, like credit card rewards.

Are there credit cards with low interest and cash back?

Yes, there are credit card options that offer a low interest rate to qualified applicants, as well as cash-back rewards. However, you’ll generally need to have good credit in order to qualify for the most competitive rates offered by low-interest rewards credit cards.

How can I choose between low APR and rewards?

Consider your credit history and score to determine whether you meet the minimum qualifications for a credit card’s lowest APR. Also, examine your general credit card habits, like whether you often roll over a balance and what your monthly spending habits are like. Compare those details against the costs of carrying a card, like annual fees and the APR you’re offered.

Is it better to find a credit card with low or high interest?

Finding a credit card that offers a low interest rate is always the better move. The lower your APR, the less you’ll pay for borrowing on credit if you decide to carry a balance month to month.

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¹Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

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There’s also a lot of important information in a credit card statement. Specifically, you’ll find details about rates, fees, transactions, payments, and any changes to your card’s rules and regulations. All of the fine print might look overwhelming, but if you spend some time learning how to read your credit card statement, it will become easier to navigate. In fact, you may even find it helpful in understanding how to manage your credit.

Keep in mind that every credit card provider’s statement looks a bit different, though they’ll share some similarities. In other words, your statement might look a bit different from our high-level overview of a credit card statement’s components. Still, this guide can serve as a jumping-off point to better understanding a credit card statement.

How to Read a Credit Card Statement

Below you’ll find an overview of each of the major sections of a credit card statement, as well as what important information you can find there.

Account Summary

This section is an overview of all of the transactions that have taken place on your credit card account during a billing period. Here are some key pieces of information you’ll find in the Account Summary section of your credit card statement:

•   Your name and mailing address: While this is information you already know, it’s important to make sure it appears accurately on your statement.

•   Your account number: The entire account number may appear, or the statement may only list the last four digits.

•   The billing cycle’s dates: You’ll see your credit card statement closing date and the length of your billing cycle, which impact how interest is calculated. The statement will only reflect activity from the current billing cycle. This means your statement may show different numbers than what you see when you look at your account online, which may include transactions that occurred after the credit card statement cycle closed (this is the difference between a credit card statement vs. current balance).

•   The previous balance: This is the previous month’s remaining account balance.

•   The new balance: This figure takes into account all of the activity for that billing cycle. Additional purchases, interest charges, fees, balance transfers, credits, or payments are either added or subtracted to the previous balance to determine this balance. If, for whatever reason, you were credited more than you owe, that would result in a negative balance on a credit card.

•   Your credit limit and available credit: This is where you’ll find your overall credit limit, as well as how much of that remaining limit is available for your use.

Recommended: What is the Average Credit Card Limit

Payment Information

In this section, you’ll find information on what is owed for the billing cycle. If you look at no other section on your credit card statement, you’ll probably want it to be this one. Here’s what you’ll find there:

•   Your new balance: This is how much you’ll owe on this particular statement. If you pay this amount in full, you can typically avoid accumulating interest charges.

•   Minimum payment: This section will include information on your minimum payment for the month. You must pay this amount to avoid late fees and negative reporting to the credit agencies.

•   Payment due date: If you fail to make the minimum monthly payment by your payment due date, you may be charged a late fee. Missing a payment might also trigger a higher penalty annual percentage rate (APR) and potentially negatively impact your credit score.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

Late Payment Warnings

Credit card statements typically have sections that state what happens in the event that a minimum monthly payment is not received by the due date listed. The late payment warning generally includes information on the penalty APR (if applicable) and the late payment fee.

Minimum Payment Warning

The minimum payment warning section explains how long it will take to pay off a credit card balance and how much interest you’ll owe if you make only the minimum payment. While it’s possible to pay off a credit card balance by only making minimum payments, the process can be slower and more costly in the long run when you factor in compound interest.

The minimum payment warning section may include details for an expedited payment schedule, such as three years, or 36 monthly payments. This can serve as a useful comparison if you’re unsure of just how much you’ll save in interest charges by making more than the minimum monthly payment.

Another way to explore interest costs over different repayment periods is by using a credit card interest calculator.

Recommended: What is a Charge Card

Rewards Summary

If you carry a rewards credit card, arguably the most fun section to review on a credit card statement can be the rewards summary. Here’s what you can find detailed in this section:

•   Prior rewards balance: This shows your rewards accrual from spending in prior billing cycles.

•   Rewards earned this period: This shows how many points or miles were accumulated over the most recent billing period through using a credit card.

•   Rewards redeemed: This will show the amount of rewards you’ve redeemed that statement period, if any.

•   Rewards available for redemption: This portion details how many points or miles you’re currently able to redeem, whether for cash or travel.

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Credit Counseling Notice

Your credit card statement may include information for nonprofit credit counseling. If you’re having a difficult time managing your credit, you might consider using this resource. These programs are typically long-term solutions, however, and may not be able to help if you’re in immediate risk of missing a payment.

If you are unable to make a payment, call your credit card company and ask about your options. Credit card companies may have ways to help.

Recommended: When Are Credit Card Payments Due

Notice of Changes to Interest Rates and Other Changes

If an action on your account triggers some sort of change to the account, there is usually a section dedicated to explaining this change (or potential change). For example, if a missed payment triggers the penalty APR rate, you must be notified of the change.

Similarly, if there are any other major changes to your account, rates, or fees, you may find more details in this section.

Recommended: How to Avoid Interest On a Credit Card

Transaction Charges

This section is a list of all of the transactions that occurred during a billing cycle, including:

•   Purchases

•   Returns

•   Any other activity that would affect the running balance on a credit card

Additionally, each transaction typically includes the following information:

•   The vendor

•   The date the transaction was made

•   The date the transaction was posted to the account

•   The dollar amount of the transaction

Note that this section will only include information from the transaction period. Transactions that happened after the billing cycle will be included in the next period’s statement.

You may want to consider making a regular habit of checking your transactions each month to look for any errors or potentially fraudulent activity. If something looks suspicious, report the activity to your credit card company.

Fees and Interest Charges

Credit card statements typically have a section dedicated to fees and interest charges. In this section, you may find the following:

•   Interest charges by type of transaction: You may be charged a different interest rate for purchases than for balance transfers or cash advances, for instance. This section will break down the APR for each transaction type.

•   Interest charge calculations: In this section, you’ll be provided with the calculation for how interest was charged on each type of transaction.

•   Year-to-date total of all fees and interest: Credit card statements may also include a total of all fees and interest charged for the current year.

The Takeaway

As you can see, your credit card statement contains a wealth of information. Learning how to read a credit card statement can ensure you have all of the details you need to be an informed cardholder. Plus, understanding a credit card statement can help you learn how to better manage your credit and take advantage of all that your card has to offer.

Perhaps one of the most exciting credit card statement sections to review is the rewards summary — but you need a rewards credit card for that to be included. If you’re looking to earn rewards through your everyday spending, consider a cash-back rewards card like the SoFi credit card.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.¹

Take advantage of this offer by applying for a SoFi credit card today.

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¹Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

¹See Rewards Details at SoFi.com/card/rewards.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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