According to an article in Forbes, as study conducted by the Pew Charitable Trust found that credit cards offered by credit unions may offer lower rates and cheaper fees than their bank issued counterparts.
The article said:
"The study found that the median advertised interest rates for credit cards issued by the nation's 12 largest credit unions were 20% lower than those for bank-issued cards. All told, the study looked at 400 financial institutions and was conducted by an arm of the nonprofit and non-partisan Pew Charitable Trust."
But according to the study, interest rates weren't the only areas where credit union credit cards were cheaper than credit cards issued by banks. The interest rates charged on cash advances were only as high as 13.75 percent while banks charged 21.25 percent. Late payment and over-the-limit fees on credit cards issued by credit unions was a median of $20 while bank credit card customers paid a median fee of $39.
For consumers considering a credit card, while it is important to consider interest rates and fees; it is more important to consider your ability to repay the money before you accrue any interest. Look at it this way: If you purchased an item for $20 on a credit card with a 13.75 percent interest rate and paid it back over a few months, you could end up paying twice or even three times what you originally paid for the item. This is how many debtors end up in financial trouble and eventually filing bankruptcy. While credit cards and other credit instruments can be useful, they should be used with extreme caution even if they have low interest rates and reasonably priced fees.