• Secured Credit Cards on FD

    Credit Card Application

    Credit cards come with a great deal of convenience in your livelihood. Many of the cards give attractive offers like cashback, rewards, miles, etc. based on your credit card and its usage.

    But, not everyone in Singapore can conveniently get a credit card. Because banks in Singapore put up certain eligibility factors for getting a credit card, and you have to qualify for that. Let’s look at the reasons for not getting/not qualifying for a credit card:

    • Unemployed - You might have decided to discontinue your employment.
    • Low annual income - Your annual income is below S$30,000.
    • Retirement - You may not have an annual income of S$15,000 or assets worth S$750,000.
    • Poor credit history - You may have bad credit history.

    If you fall under any of the above categories, it doesn’t matter. There is always an alternative, and here it is "Secured Credit Cards”. Secured credit cards were first introduced by the Monetary Authority of Singapore (MAS) with regard to the issue of credit cards in Singapore. Secured credit card is a kind of credit card that’s issued by banks against your investments such as fixed deposits. Generally, housewives, retirees, and people with low credit score benefit greatly from secured credit cards.

    Features Of Credit Cards Against Fixed Deposit

    • You will have to pledge a minimum fixed deposit amount of S$10,000.
    • Your credit limit will be equivalent to your fixed deposit saving.
    • The rate of interest for secured cards are generally not high as compared to conventional or unsecured credit cards.
    • Secured credit card may not extend as many offers as unsecured credit cards do.
    • You cannot withdraw your fixed deposit as long as you own a secured credit card against that particular fixed deposit account.
    • However, if you really want your fixed deposit amount, you must first terminate the secured credit card and request the bank to release the pledge.
    • Eventually, with responsible usage and timely payments, you can become eligible for an unsecured credit card.

    How To Get A Credit Card Against Fixed Deposit

    It’s very easy to get a credit card against a fixed deposit. Firstly, you must open a fixed deposit account with the bank that provides this facility. You must deposit a minimum of S$10,000 to get a credit card against this account. If you already have a fixed deposit account with the required amount, you do not have to open a new one. Banks will accept your existing FD account for pledging purpose. Once the FD account is open you can simply apply for the credit card online or offline and get approval from the bank.

    Benefits Of Secured Credit Cards

    • Minimum income requirement is waived off.
    • Documentation is easily done and income statement or credit score check is not required.
    • Grace period of repayment of credit card bills is longer.
    • Banks will be more lenient in case of late payment of bills.

    Banks offering Secured Credit Cards

    HSBC Secured Platinum Visa Credit Card:

    • Open an HSBC Time Deposit account, and deposit at least S$10,000 for the Secured Platinum Visa Card.
    • Annual fee is waived off for the first two years.
    • You can use this card overseas i.e. in over 77 countries worldwide.
    • Earn rewards at the rate of S$1 = 1 reward point.
    • Redeem your rewards at 145 participating brands or convert them to miles.
    • Enjoy up to 19% off on petrol purchases at Shell and Caltex with your HSBC credit card.

    UOB One Card

    • The annual fee is S$192.6 and it’s waived off for the first year.
    • Earn up to 5% rebate on all spends on your UOB card.
    • Get up to S$80 welcome cash credit when you apply for this card online.
    • Get deposit interest rate up to 3.33% p.a. on your UOB One Account.
    • Save up to 20.8% on fuel spends at Shell and up to 24% at SPC.
    • Earn additional 10% SMART$ rebates at more than 400 participating brands.

    UOB Lady’s Card:

    (For this card, you must be a woman)

    • Enjoy free parking during weekends at 313@somerset, Paragon, Forum The Shopping Mall, and Scotts Square.
    • Get e-Commerce protection for free on your online purchases up to US$200.
    • Complimentary wine bottle when you dine in Singapore,Hong Kong and China.
    • Get deposit interest rate up to 3.33% p.a. on your UOB One Account.

    UOB PRVI Miles Card:

    • The minimum UOB fixed deposit collateral must be S$30,000.
    • Annual fee is S$256.80 and fee for the first year is waived off.
    • Earn 1.4 miles for every S$1 spent in Singapore and earn 2.4 miles for every S$1 spent overseas.
    • Also earn 6 miles for every S$1 spent at major hotels and airlines through Agoda, Expedia, and UOB Travel.
    • You can redeem your reward points for miles, travel vouchers or cash.
    • Enjoy complimentary insurance on personal accident and travel inconvenience. The coverage is up to S$1million.

    Having a secured credit card is another way to rebuild your credit score. It is also easy to get secured credit cards, but if you default or miss payments, your FD collateral is at a risk. If you want to have secured credit cards, ensure that you don't require your fixed deposit funds urgently. It is wise to avoid the banks that have very long withdrawal periods.

    Fixed Deposits from Top Banks
    Foreign Currency Fixed Deposits from Top Banks
    Currency Specific Fixed Deposit
    US Dollar Foreign Currency Fixed Deposit by Bank
    Australian Dollar Foreign Currency Fixed Deposit by Bank
    GBP Foreign Currency Fixed Deposit by Bank
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    Fixed Deposit Promotion by Banks
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