Store credit, payment and loyalty card, checkout facilities: not easy to navigate among all the solutions offered by the brands. What matters to us, whether it’s store credit or not, is finding a cheap small credit solution. Everything you need to know to understand the logic of store credit and take advantage of it without breaking the bank.
What is a store credit?
In principle, store credit is a complementary means of making a sale successful for a merchant. The idea is to be able to adapt to the client’s budget and smooth the reimbursement of his purchases over time. Normally, everyone wins.
But the legislator had to find that those who gained the most were the credit organizations because the number of laws to regulate store credit has multiplied since the early 2000s.
It must be said that the whole difficulty is to define what would be the right price, or the right rate for a store credit.
What we can say is that, until the Lagarde law, store credit very largely took the form of revolving credit. It was mainly issued through a credit card, and could therefore have variable rates up to 20% of APR as authorized by law.
Things have evolved since then and are much more framed. It is now essential for stores to distinguish between loyalty cards and revolving credit cards. It is above all a question of informing the consumer, through statements and contracts clearly stipulating the product for which he is committed. This does not prevent the loyalty and credit payment functions from being combined on a single card.
Store credit = loan allocated to a specific purchase
Store credit only allows you to leave with a good or service, never money. To compare the revolving credit rates online, you have to get closer to our comparator.
Created on the basis of a single questionnaire, our credit comparator offers the ranking of the 3 best offers tailored to your project. In addition, you will benefit from a non-binding evaluation of the cheapest credit organization. You can ask to have an evaluation for the second and third best rates, always free and without obligation. This exclusive technique increases the chances of actually obtaining credit at the best rate.
The different forms of store credit
Store credit cards
They are the most widespread and it is a French specialty. Over 40 million store credit cards are in circulation. These cards are backed by revolving credits, and offer many variations of credit offers.
The main payment methods for store cards are:
- Cash payment (immediate or deferred)
- Payment in 3 installments with or without fees
- Payment in X times at 0% APR rate (free credit) or X times paying
- Promotional rate payment
- Payment by small monthly payments, revolving credit
- Report 3 months
In addition to these main features, there is the possibility of requesting a transfer directly to your bank account. This use, like the payment by small monthly payment, is ultimately a revolving credit which is often subject to rates close to usury, that is to say up to 20% of APR depending on the amounts borrowed. This is why Bankate recommends taking standard credit when your debt is too high. This allows in some cases to avoid paying hundreds of USD in additional fees.
Sales periods or holidays conducive to store credit
We encourage you to take a good look at the offers offered by store credit card distributors. Because very often, they take charge of all or part of the agios during the promotional period. In this case, we are talking about real free credit. For example, during Christmas or back to school, there are often fixed 0% APR credit offers. Agios are taken care of by stores. Do not hesitate to take advantage of it, everyone is there!
Store loans are more and more controlled
The latest store credit laws oblige lenders to combine a traditional depreciable consumer credit solution with a revolving credit formula greater than 1,000 USD. Store credit can therefore take the form of an allocated amortizable loan or sale on credit. This means that the store credit to which you will subscribe will be allocated to the sale for which you are the beneficiary. The sale and the store credit are dependent on each other and must be concluded together.
The store loan is a payment that will be spread over a period defined in advance. The rate, APR will also be fixed in advance as well as the monthly payment.
Cash facilities explained
The last most common form of store credit is the cash facility. We can designate under this category the payment facilities which are not subject to consumer credit regulations. Its best known form is payment in 3 installments at no cost. However, paying in three installments free of charge can itself take a variety of forms. There is quite simply the small trader who will offer to make him 3 checks which he will cash every month for 3 months. Then there are merchants who will offer to pay in 3 installments at no cost but you will have to:
- present your identity card
- your RIB
- sign a “mini contract”
- sign a debit authorization
- provide your bank card
Finally, the last form of store credit is the virtual form. It is the payment in 3 times without fees on the internet. We offer you, through your bank card, to pay in 3 installments (less than 90 days).