Retail store credit cards: Are they worth it?

Store cards offer immediate discounts, but carry very expensive APRs – you might do better elsewhere


Retail store credit cards, which usually offer on-the-spot sign-up discounts, may seem an attractive way to save on gifts and other holiday-related purchases, but a general-purpose cash back or rewards card might be a better option

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

Dear Cashing In,

I was doing some Christmas shopping the other day at the mall. The department store I went into offered me 10% off for signing up for their store credit card. Is that worth it? – Jackie

Dear Jackie,

It’s the time of year when crowds pack into the shopping malls looking for holiday deals. That also means that it’s the time of year when retailers try to sign shoppers up for rewards credit cards.

When you go to the register to check out, clerks will often ask if you want to save some money on your purchases by opening the store’s credit card. Usually, it’s billed as a quick way to save some money – often 10% off your first purchase – which can pay off, especially if you’re buying a lot.

Check out all the answers from our credit card experts.

Ask Tony a question.

See related:  Comenity bank credit cards

Retail store cards: When it makes sense to sign up

So, should you sign up? It can be hard to turn down the instant savings that a lot of store reward cards offer, and that might be tempting. But the usual rule on cobranded credit cards applies: People who gain the most value out of such a card will be those who use it with the company sponsoring it.

For instance, people who get the most out of a Macy’s credit card will be those who shop a lot at Macy’s.

Lately, retailers have been adding perks to their reward credit cards to make them have appeal beyond just the standard discount on the first day of signing up for the card. Noting the trend of online shopping, they are making the cards appeal more to customers who buy on their websites, too.

Retail store credit card rewards

Here are a few of the big department store reward cards, with details on earning and using rewards and the other perks they offer:

Macy’s American Express card

  • Annual fee: None.
  • Earning: 3x points at restaurants, 2x points at gas stations and grocery stores, 1 point per dollar on all else.
  • In addition, you can earn 5% back in rewards at Macy’s after spending $1,200 a year as a Macy’s Star Rewards program.
  • Redeeming: Points can be redeemed for credits at Macy’s
  • Perks: 20% off on the day you sign up for an account and the day after (in-store or online), up to $100 in savings. Free shipping when you are a Gold or Platinum Macy’s Star Rewards member.

Nordstrom Visa Signature card

  • Annual fee: None.
  • Earning: 3x points on Nordstrom purchases. 2x points on dining, travel and entertainment. 1 point per dollar on all else.
  • Redeeming: Points can be redeemed for credit at Nordstrom
  • Perks: Early access to anniversary sale, access to invite-only events, free alterations (cost reimbursed with store credit), once-a-year visit to your house by a Nordstrom stylist to “edit your closet”

JCPenney Credit Card

  • Annual fee: None
  • Earning: 1 point per dollar – 0.5 points on qualifying JCPenney purchases, plus an additional 0.5 points as a JCPenney loyalty program member. The card can only be used at JCPenney.
  • Redeeming: Points can be redeemed for credit at JCPenney
  • Perks: 15% off purchases on the day you open your account on select apparel, shoes, accessories, fine jewelry, salon products, furniture & mattresses, home and in-home custom design, or 5% off purchases on select electronics, Modern Bride Design Your Dream Ring, smartwatches and Tempur-Pedic.

Are retail store cards the way to go?

You can see from these examples that benefits are designed to encourage you to shop at those stores. Many big retailers have store cards that can be used only at those stores, while some (like Macy’s and Nordstrom) also offer Visa or American Express cards that can be used anywhere. The rewards are usually in the form of store credits.

There’s nothing wrong with signing up for a new card to receive a discount at the store. But be aware that when you do that, the stores check your credit, which has a slight and temporary negative effect on your credit score.

Further, store cards have on average higher interest rates than general purpose cards, which can make them very expensive if you don’t pay them in full at the end of the month. Regular cash back cards have an average APR of over 17%, according to’s Weekly Rate Report. By contrast, a recent survey found that retail store credit cards have an average APR of 26%.

Before being lured in by the sales pitch at the register, understand how the cards work – and realize that you might have other, better options available to you if you’re in the market for a rewards credit card.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

Credit Card Rate Report
Cash Back

Questions or comments?

Contact us

Editorial corrections policies

Learn more