Store credit cards aren't always a great value, but options from Amazon, Kohl's, and Sephora offer strong rewards if you're a brand loyalist

Caroline Lupini

Feb 3, 2020, 19:48 IST

Business Insider/Jessica Tyler

Store credit cards aren't always a great option, because they come with some of the highest interest rates around and tend to only offer bonus rewards on purchases with one specific retailer.
However, if you're loyal to a brand and don't need to carry a balance, there are some store credit cards that offer decent value.
Top options include the Amazon Rewards Visa Signature Card, the REI Co-Op World Elite Mastercard, and the Kohl's Charge Card.
Make sure you research your options. A cash-back card like the Citi® Double Cash Card or an option that earns travel rewards could be a better fit for you.
See Business Insider's list of the best rewards credit cards »

Store credit cards are as much a part of the shopping experience as sales associates asking if you are "looking for something special." They're almost unavoidable during the checkout process. And while that 10% or 20% off as a bonus for opening the card on the spot can be tempting, it's usually not worth the hassle due to high interest rates and limited rewards.

If you are late on payment, the interest and on purchases made with your store credit card are notoriously high. And in general, what you earn from these cards isn't as valuable as the points and miles you can earn for travel. However, if you're looking to rebuild your credit or if you shop a lot at one retailer in particular, a store credit card could make sense. The credit limit on store credit cards are low, so there's not a high qualification threshold, and, they offer perks to loyal shoppers.

If you've been thinking about store credit cards, here are the ones on the scene that have proven to be truly rewarding.

Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back.

Amazon Rewards Visa Signature Card

If you're like millions of Americans, you likely purchase everything from household goods and appliances to skincare and snacks on Amazon. The Amazon Rewards Visa Signature Card acts as more of a regular cash-back credit card than a store credit card, making it an ideal addition to any shopper's wallet.

In addition to Amazon-specific benefits like 3% back at Amazon.com and Whole Foods, you will also enjoy no annual fee or foreign transaction fees, travel insurance and complimentary Visa Signature Concierge Service. With 2% back at restaurants, drugstores and gas stations, and 1% back on all other purchases, you will rack up points in no time, which you can easily redeem during checkout at Amazon.com.

There is no minimum rewards balance to redeem, so you can claim a $5 redemption, or wait and save your points for a grander redemption. As a bonus for signing up for the card, you can expect a $50 Amazon.com Gift Card upon approval. This is one card Amazon shoppers rave about because you can find nearly anything on the site, and you get equal cash back on grocery shopping at Whole Foods.

REI Co-op World Elite Mastercard

Aside from being one of the coolest-looking cards, complete with a campfire scene illustrated on the front, the REI Co-op World Mastercard is a valuable card if you purchase a lot of sporting goods and equipment, are an avid camper or hiker, or if you care about the environment.

In an effort to preserve national forests and grasslands, REI will make a donation to the National Forest Foundation every time you make a purchase with your card. On top of that, you'll earn a gift card with a $100 value when you make your first purchase within 60 days of account opening.

The card has no annual fee, and you'll earn 5% back on every purchase made at an REI retailer, 2% back on mobile wallet purchases, and 1% back on everything else. REI members also receive an annual dividend of about 10% on qualifying purchases.

Sephora Visa Credit Card

Calling all makeup junkies: Sephora now has a store credit card with benefits that are sure to help keep your medicine cabinet stocked. Benefits include 15% off your first purchase at Sephora after opening your card, 4% back in rewards dollars either in-store or online, 1% back on everyday purchases, no annual fee, a tap-to-pay feature, and a $20 reward to be used at Sephora when you spend $500 outside of Sephora purchases within the first three months of opening the account.

In addition to the aforementioned benefits, you will also have access to Beauty Insider (Sephora's loyalty program). This includes access to rewards, gifts, savings, and more. The initial bonus of 15% off your first purchase can really add up if you have a big purchase planned, and you can apply it to luxury products like La Mer, which can cost up to $500, or the always-out-of-stock Dyson Airwrap that costs $550. That alone would be a savings of $82, or more if you buy multiple products to up your savings.

Kohl's Charge Card

Kohl's shoppers love this retailer for its frequent discounts and sales. If you're a fan of Kohl's and want to save even more, the Kohl's Charge Card, issued by Capital One, could be the best option for you. In addition to 35% off your first Kohl's purchase with the card, you can expect added benefits like discount mailers of 15% off at least once a month. As a cardholder, you can also return items without a receipt.

Frequent shoppers will enjoy exclusive perks like becoming a lifelong Kohl's MVC (Most Valued Customer) after spending $600 in a calendar year. At this level, cardholders will earn six additional discount mailings per year, a birthday gift, and free shipping events every month.

While there are no spending rewards, you can sign up for the retailer's loyalty program, Yes2You Rewards, for 1 point per dollar on Kohl's purchases. There is no limit to combining offers, so you will find the best value on this card by combining mailer discounts with Yes2You Rewards promotions.

Consider your other options too

Overall, there are better credit card options than store cards, from cash-back cards like the Citi Double Cash Card to the Chase Sapphire Preferred Card for earning travel rewards. But if you regularly shop at any of the stores mentioned above, a store card could be a really great option - especially if you have a big purchase coming up or are looking to build your credit. I personally have and use both the REI Card and the Kohl's Card, and both have served me well!

See Business Insider's list of the best rewards credit cards »

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

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Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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