Joint credit cards

Joint credit cards are when a credit card account has two or more people who are on the account.  There are a number of variations on joint credit cards.

The most common form of joint credit cards is known as a co-signatory credit card.  These credit cards are when there are two people who are liable for the credit card debt.  There are cases when both people will have a credit card and will use it, and this is often the case with married couples although it is more common for married couples to have a common transaction account and to have separate credit cards.

Another use for joint signatory credit cards is when there is one relative who finds it hard to borrow money on a credit card because they’ve either got a poor credit rating or they do not have a large income.  This can be the case with either students or pensioners.

In this case there may also be a relative with a good credit score and a reasonable income who may want to help their child or parent achieve some financial independence.  A co-signatory credit card is good for this sort of purpose.  In these cases the credit card can be guaranteed by a co-signatory who has rights to receive credit card statements and to set the credit limit.

With these cards the other person can get some financial independence by using and paying off a credit card.  As they are also using someone else’s name they are in effect borrowing the credit rating and so they can get a lower interest rate and a higher credit card limit than they would otherwise be able to do.

Another type of credit card that acts like a joint credit card is the subsidiary card.  This card is a card where the main account holder does not hold all the cards but these cards are held by relatives who have their own card, but this card is charged back to the main account.  This can sometimes be the case with married couples where the main wage earner is in the position of paying off both accounts.  In these cases it can be quite a good idea to look closely at the credit limits and daily spending limits on the individual credit cards in order to avoid misunderstandings.

A variant of the subsidiary card is the company credit card.