Credit Card Application

How to choose a Credit Card in Singapore

A credit card is a payment card issued by banks to help you make cashless payments. Credit cards are issued by banks as well as credit card companies based on the agreement between you and your credit card provider. As per the agreement, you promises to return the payment to your provider every month on a specific date.

A credit card can be extremely useful when it comes to face financial emergencies in life. Well, how do you choose the right card for you? Choosing the right credit card for you is not that difficult, provided you are aware of your requirements. Listed below are some of the tips that would help you choose the best credit cards for you in Singapore.

Identify your requirements:

First know and understand your requirements. For example, if you need a credit card for balance transfer, you should opt for a balance transfer credit card. If your intention is to pay for your travel expenses, you can apply for an air-mile credit card. So, based on your requirement you choose a card. It could for earning rewards, saving money, paying for travel, shopping and any other lifestyle related needs. So, when it comes to choose the best credit card in Singapore, knowing your requirements is very important.

Analyze your Spending habit:

If you are kind of person who use credit card for most of the things you buy, opt for a credit card that provides a gorgeous credit limit and also comes with rewards. If you think you would not be able to pay your full bill in every month, then opt for a credit card that a credit card with no annual fee and longer grace period. Again, if you think you will not be able to pay your balance in full and carry a balance, opt for a credit card that charges lowest interest rate. Similarly, if you are someone who needs a credit card only to meet your emergencies, opt for a credit card with low interest rate and annual fee.

Annual Percentage Rate (APR):

Know the APR (annual percentage rate) charged on your credit card. APR can be fixed or variable. With a fixed rate card, your monthly interest rate does not change. But, with variable rate of interest charges keep changing. APR refers to the cost of borrowing and it is charged when you fail to return the borrowed to your lender on time, or at the end of each month. It's better you compare the APRs charged by various credit cards in Singapore, and then choose a card.

Know your credit score:

It’s important you know your credit score before you apply for a credit card in Singapore. The best credit cards in Singapore requires you to have a good credit score. A credit score serves as an indicator predicting how likely you are going to repay your credits borrowed from banks or any other financial organizations. You can check your credit score by obtaining a copy of your credit report from Credit Bureau Singapore. It’s important you check your credit score every year. Having a credit grade of AA would help you opt for the best credit cards in Singapore.

Minimum repayment:

Know the % of minimum payment allowed by your credit card provider. In case you fail to clear your monthly credit card balance, at least there is a provision for minimum payment.

Annual fee:

Select credit cards charge annual fees on the credit amount lent to you. Credit card annual fees differ based on the type of card chosen. Not all credit cards come with annual fees. Usually premium credit cards that offer a wide range of attractive rewards and benefits charge annual fees for the convenience offered. The annual fee is usually a one-time affair which is charged at the beginning of the calendar year. Some banks/providers charge it for the first year; others for first two/three years and for some card it is an ongoing annual process.

Miscellaneous Charges:

It's important you know all other charges applicable on your credit card (if any). To know, you need to read the credit card agreement careful. Credit card providers may also charge you for using more than the given credit limit, using it abroad, renewing it, and making delayed payment of monthly balance.

Introductory interest rates:

Introductory rates refers to the interest rate charged during the first several months. Introductory rates are offered to credit card applicants who possess a good credit score. Introductory rates usually apply to purchases, balance transfer. Introductory rates in a credit card usually lasts for 6 months, 12 months and sometime more than that depending on the card you have.

Loyalty points / rewards: Many premium credit cards offer attractive rewards and loyalty points which you can redeem later for purchasing various goods/services. Check the type of rewards/points applicable on your credit card and also where and how you can redeem these rewards. Also, don’t forget the fact that you become eligible for these rewards based on the amount you spend. If you have the habit of spending more than your credit limit, no matter how high the credit limit is, you may end up missing a lot of benefits.

Credit Card Cashback: Cashback is also a kind of incentive offered by credit card providers to credit card users where money gets refunded to your credit card account. Unlike reward points, credit card cashbacks don’t expire; it gets automatically credited your account and you can utilize them at any time

Cash rebate: There are many banks in Singapore that offers credit card cash rebate. With cash rebate credit cards in Singapore, you can get attractive discounts on your purchases made through your credit cards. Some of the popular cash rebate credit cards in Singapore include - HSBC Visa Platinum Credit Card, OCBC Platinum MasterCard Credit Card, OCBC Robinsons Group Credit Card, UOB Preferred Platinum Visa Card, and HSBC Advance Visa Platinum Card to name a few.

Compare Credit Cards: Having known all the factors that you need to consider before choosing a credit card in Singapore, the next important thing is to compare the feature and benefits of different credit cards offered by banks or credit card providers so that you can find the best deal based on your requirements. Credit card comparisons in Singapore can be done by visiting any reliable online financial websites in Singapore.

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