What Is a Platinum Credit Card?
According to Discover Financial Services, the platinum credit card was once used to convey exclusivity. However, this card has become more accessible to most consumers. Generally, platinum cards offer a higher credit limit and a lower interest rate. In addition to the traditional platinum credit card, consumers may obtain a secured platinum credit card.
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Credit card companies often categorize cards by color to indicate benefits and interest rates and ranges. Usually, primary-color cards such as green, blue and red indicate a card offering base level benefits with a standard or higher interest rate. Metallic-colored cards, such as silver, gold and platinum, connote a higher credit status and, usually, better benefits.
Standard Platinum Card
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Generally, platinum credit cards are reserved for applicants with good credit (700 and above credit score) and adequate income to accommodate the higher credit limit offered. The benefits afforded by these prestigious cards vary. For example, some platinum cards allow access to VIP airport lounges, dedicated travel agents or concierge service. The interest rate on these cards may be lower than the rate on other cards, and the annual fee may be waived. However, some cards may have a higher annual fee, particularly if the interest rate is quite low.
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Non-Standard Platinum Card
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Some financial institutions have introduced a platinum credit card for borrowers with fair or poor credit (650-600 and below), or those with limited or no credit history. Typically, this card has a higher interest rate because recipients are deemed poorer credit risks. Another type of platinum card may work only as a debit or secured card, meaning that the recipient can only "charge" or use the amount of money he has placed in a bank account. The interest rate on a secured platinum card can be competitive with or even lower than other basic cards because the recipient has placed a collateral deposit to secure this card. A platinum debit credit card can provide better benefits than standard debit cards; however, benefits vary depending on the issuer.
Obtaining a Platinum Card
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You can apply for a platinum card through the issuing bank or financial institution. Borrowers should compare individual credit cards before applying for a card to obtain optimal benefits and a low interest rate.
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