Some types of credit cards are easier to qualify for than the rest, either because they require collateral or because they come with limitations. Falling into the latter category are store credit cards, which can only be used within a single type of store or a family of stores. That said, retail credit cards offered by stores still have their share of benefits, and they can be incredibly useful when it comes to building credit in the first place.

If you’re wondering whether you should apply for a store credit card or whether you can actually get approved, it helps to know how store cards work, as well as their limitations and pitfalls. You’ll also want to know some alternatives to store credit cards that can help you learn positive credit habits while building credit for the future along the way.

Can you more easily be approved for a store card than a traditional credit card?

Generally, yes — store credit cards that are co-branded with a specific store are among the easier credit cards to see approval for. This is partly due to the fact these cards can only be used in one store or with one brand, but it’s also because they tend to come with low credit limits overall.

For these reasons, store credit cards can make great starter credit cards for young adults who are just starting out in their journey to good credit. A store credit card gives you a chance to make purchases and get accustomed to paying a credit card bill each month. More importantly, store credit cards report balances and payments to the major credit bureaus, helping you to build your credit score over time.

Another benefit of store cards comes in the form of the perks they offer. While store card benefits vary, many come with points or discounts on purchases, ongoing promotions for shoppers, regular coupons, special retail events and other benefits that apply only for loyal cardholders.

The limitations and pitfalls of store credit cards

All this said, it’s worth noting that many store credit cards are not run on major networks like Visa or Mastercard. Store cards are issued by a range of card issuers, including Synchrony Bank and Capital One, and are designed to be used at one specific store or within a network of stores instead.

Store cards have other limitations and pitfalls, including low credit limits and high APRs. Take the Kohl’s Credit Card — this store card is issued by Capital One, yet it’s only useful at Kohl’s stores or at Kohls.com. The Kohl’s Credit Card also comes with a variable APR of 31.24 percent, and the starting credit limit for consumers can be as low as a few hundred dollars.

Another example is the Amazon Store Card, which is issued by Synchrony Bank. This store card comes with a variable APR of 29.99 percent, and applicants are likely to start off with a low credit limit at first. Similar to the Kohl’s Credit Card, the Amazon Store Cardt card can only be used for purchases with the online retailer.

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