About Gasoline Credit Cards

Gasoline credit cards work in a similar manner as other bank-issued credit cards in that they allow the user to charge purchases and repay at an agreed upon interest rate. Gasoline credit cards, however, are more likely than other consumer credit cards to offer rewards and incentives. The key to getting the best value in a gas card is to do your research and choose a card that works best for you.

Definition

A gasoline credit card is a bank-issued card that allows you to charge purchases at a specific gasoline retailer and repay them under agreed upon terms. Most major gas station chains offer credit cards, and this type of card is more likely to offer a reward or customer loyalty program. Some cards give the consumer a grace period in which there is no accrual of interest provided that the balance is paid in full by the date specified on each month.

Benefits

Judicious use of a gasoline credit card can offer many benefits to the consumer. Using a card to pay for gas purchases allows one to track expenditures and eliminates the need to carry cash. Additionally, most gasoline credit cards offer rewards or incentives for its use. Cash back bonuses for gas purchases are, on average, 3 to 5 percent. Most companies send out a check when your rebate amount reaches a given level, often $50 or $100.

Considerations

Before applying for a gasoline credit card, you should research the options to find the card that best suits your spending habits, needs and lifestyle. There are numerous websites that can help you sort through the various offers. Some even offer a search utility that allows you to plug in the features that you would like in a card to help you find the best option. You should consider the interest rate, the grace period (if any), additional terms and rewards and incentives structure when choosing a card. Most importantly, get a card for a gas retailer that has numerous locations in your area, or you may find yourself driving around looking for a certain gas station all the time.

Warning

As with any type of credit account, read the fine print and be certain that you understand and agree with the terms before you apply. Be aware that creditors can change the terms of the agreement, including interest rates at any time and for any reason. This means that an introductory rate can turn into a very high interest rate overnight. When you are choosing a card in part because of a rewards program, consider whether or not the cash-back percentage is enough to justify your use of the card. Watch for introductory offers. Many cards begin the term with a 6% cash back offer that quickly drops to 3% or less.

Types

There are several different types of gasoline rebate cards available, including cards that are issued by a single retailer (such as Exxon) that can be used only at that particular chain or bank-issued credit cards that can be used at any retailer but offer rewards that include rebates on gas purchases. In some cases, a credit card will offer cash-back rebates with higher rates of return on gasoline purchases.