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Published July 12, 2023
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What to Know About Store Credit Cards

Store credit cards reward retail brand loyalists, but they come with caveats — higher interest rates, limited perks and inflexibility.

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Store credit cards offer benefits and rewards from a particular retailer, which makes them attractive to shoppers who frequent a specific business or store. 

What is a store card?

Store cards are a type of credit card that treats brand loyalists to benefits like loyalty rewards, in-store discounts, VIP perks and exclusive offers. Essentially, they are rewards credit cards designed for people who mainly shop with specific brands. And, as the variety and volume of rewards cards continues to grow in Australia, store credit cards have become less popular than they once were. 

Getting a store credit card is typically easy, even without a good credit rating, but they have notable drawbacks — inflexible rewards programs, low credit limits and higher interest rates. 

However, if you already spend a lot with one specific brand, a store credit card could help you save money with every shop.  

How a store credit card works 

Big supermarkets and department stores aim to recognise loyalty through store credit cards. To do so, a retailer will partner with a bank to provide a co-branded credit card that offers customers discounts, rewards and promotions. For example, the Coles Low Rate Mastercard is a Coles-NAB joint product. 

Australian retailers with store credit cards

The 5 major retailers in Australia with store credit cards are: 

  1. Coles 
  2. Woolworths 
  3. David Jones 
  4. Myer 
  5. Kogan

Coles and Kogan are the only retailers currently accepting applications. Woolworths, Myer, and David Jones programs are on hold. 

General eligibility requirements 

Like most types of credit cards, store cards are designed with different demographics in mind, so general eligibility requirements vary — still, most have pretty relaxed requirements. 

For example, to apply for the Coles store cards: 

  • You must be at least 18 years old 
  • A permanent Australian resident 
  • Have a regular income and be in good credit standing 
  • An Australian mobile number and email address 
  • Already be a Flybuys member. 

» MORE: How to get a credit card in Australia

Should you get a store credit card?

While any rewards you accrue to save money are worth looking into, there are drawbacks and caveats to be aware of before you apply for a store credit card. 

Store credit cards — and their rewards — can’t always be used everywhere

When you use a store card, you’ll earn loyalty points on eligible purchases, such as while shopping with the retailer. You can then redeem those points towards things like cash, gift cards and travel savings or to reduce the cost of an in-store purchase. This works similarly to a frequent flyer program credit card.

For example, the Coles Low Rate card earns 1 Flybuys point for every $2 spent at Coles Supermarkets, and you can use your Flybuys points at Coles, Coles Express, Kmart, Target and other partners. 

Note that store credit cards will have varying definitions of an ‘eligible purchase’. Some only reward purchases made shopping in-store or with branded partners, while others don’t restrict where you can earn rewards. 

For example, David Jones American Express cards have tiered rewards structures: in-store shopping earns rewards at an elevated rate, but you’ll still earn some points on regular purchases made everywhere else.

Store credit cards tend to charge higher interest rates — but fees and perks vary 

Higher interest rates are standard with store credit cards, but the fees and associated perks can differ considerably. 

Compared to high-end department store cards, supermarket cards are usually more in line with what you’d expect from everyday credit products, like a credit card suitable for beginners

For example, David Jones touts its Platinum American Express card as a premium, luxurious choice that earns uncapped rewards and comes with invitations to exclusive fashion events, complimentary delivery, travel insurance, airport lounge access, and buy now, pay later options. But to get these premium benefits, cardholders face a 23.99% interest rate on purchases and a $295 annual fee. 

In contrast, the Coles Low Rate card has a $58 annual fee and a 9.99% interest rate on purchases for the first 3 years — but cardholders won’t have premium insurance benefits and can only earn rewards on purchases at Coles Supermarkets.

Store credit cards do have some perks 

Beyond the points you can earn, store credit cards offer a variety of benefits and special features, such as: 

  • The ability to negotiate new payment terms. Some cards offer fixed repayment plans for paying off credit card debt and options to access cash instalments for a limited time. 
  • Interest-free payment plans. Although not currently open to applications, the David Jones cards offer no deposit interest-free purchase plans from three months to five years. 
  • Travel benefits. Depending on the card, you can receive travel and accommodation savings and avoid international transaction fees
  • Complimentary insurance. Get added protection on the items you buy with your store credit card. If they’re lost, damaged or stolen, you’re covered. 
  • Sign-up bonus points. The Coles Rewards Mastercard comes with up to 100,000 bonus points within the first year — equal to $500 worth of Flybuys points. 

Just consider the alternatives, too 

All credit cards have pros and cons, and the card you choose needs to work for you right now. Consider when and how you’ll use a credit card. Then, make a list of the features you need. 

If you want rewards

Store credit cards are one of many choices. After comparing rewards rates, sign-up bonuses and monthly incentives, you may find a better deal with card types such as: 

If you want to build credit

Store credit cards may pose more risk than reward when it comes to improving your credit. Consider an option suitable for beginners, such as: 

Before you apply

Talk to multiple banks about their current promotions and only apply for a credit card if it’s your top choice. 

Frequently asked questions about store credit cards

Is a store card different from a credit card?

A store credit card is a co-branded credit card that works similarly to a frequent flyer card. A store credit card earns branded rewards, usually when purchasing at partner retailers. Typically, you can only redeem them with the partner retailer.

Are store credit cards a good idea?

A store credit card might be a good idea if you are exceptionally loyal to a particular retailer. You can earn points and discounts for your typical spending that might save you money in the long run. However, a store credit card might encourage excessive spending.


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