Cashless payment is the New Normal. In the wake of Covid-19 pandemic many people have relied to cashless, hassle-less, and safe payment for their bills, needs purchase and leisure. Credit cards have been a tool for this payment theatrics. Not only that it is a great means to level up your credit record it is also a discount tool to save money from our expenses and be safe when doing transactions. It is slick, handy, and beneficial when handled with responsibility.
Moreover, Credit card is an ‘adulting’ must have. It should be a part of us as financially smart, organize, and young professional beings. It may be nerve-wracking for first timers, given the fact that it can cause serious damage to your financial well-being when mistreated; nevertheless, vis-à-vis with that are great relief to our daily expenses; plus – it can be noted that in today’s time, nothing can’t be learned. however, before you delve deeper into that more complex credit card rigors, let us just be cool and be guided on basic Credit card “Must have’s and Be’s” and get your first card to up your spending game.
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1. Know if you are eligible.
In order to apply for a credit card and eventually, be accepted. You must know first if your current status will fit their minimum eligibility requirement. Banks usually checks on your age, income, employment status, and business operations. Thus, below are the most common eligibility requirements among Philippine banks.
- You must be at least 21 years old to 65 years old. Some banks allows application up to 70 years old.
- A Filipino; if you are a foreigner, you must be staying in the Philippines for 2-3 years.
- Gross annual income for basic credits must be Php. 120,000 – 252, 000; recalculating it in monthly, your income must be at least Php. 10,000 – 21, 000 every month.
- Your contact number and details must be active; if you’re changing your contact details, your bank must be notified.
- Prepare your Tax Identification Number (TIN)
- You must be regularly employed for at least a year or at least one-two years of profitable business operation or professional practice.
If your income falls short, you may still apply for secured credit card with no income requirement, but you must open a savings account with the bank and deposit at least Php. 10,000 as collateral.
2. Compare Credit Cards
Credit cards are like Harry Potter wands, it should suit the holder’s personality, likes and motives for it to be advantageous and powerful. Hence, before submitting your applications make sure that you’ve compare some qualities of various credit cards that will surely fit your personality and current status. And of course, number one on our checklist for good credit card is something that you can afford. Consider the following:
- Annual Fee – it is your membership/ convenience fee, but some banks offers annual-fee free cards for first-time applicants. So, you might want to consider grabbing those.
- Interest rate or charge – The interest for outstanding balance carried to the next month.
- Penalty fees – how much charge will you acquire for late payments and exceeding credit limits. However, the Central Bank of the Philippines have asked banks to wave penalty charges due to Covid-19.
- Rewards and Cashbacks – Cashbacks or redeemable point and discounts for a minimum shop spend. Cashback rebates, gift certificates and many more. Apply for the card that will offer the best perks.
The best option for a credit card is always the one the offers low annual, interest and penalty fees, and income requirement, and those that offers good rewards.
Also, it is also essential that we are aware of the different kinds of credit cards:
- Basic Credit Cards – Regular cards, and the suggested first-time card for young, budding applicants. It is an all-low, affordable to own cards however, these cards may not give you rewards for using it.
- Annual Fee less Cards– No annual fee, FOREVER. The only forever you may experience.
- Reward Cards and Cashback Cards – You may want to choose between Rewards and Cashbacks; accumulated points can be redeemed as discounts, gift certificates and annual fee waiver. Cashback cards on the other hand can lower your monthly total amount due, especially when you saved as much as Php. 1000 every month because of your purchase money-offs.
3. Prepare your documents and apply!
After conducting your pre-application decisions, it is now the time to actually apply for a card. Prepare the following documents:
- Completed Application Form (most are accomplished online)
- Valid, photo-bearing Identification (passport, UMID, PRC cards)
- Proof of Income: Certificate of Employment, pay slips, Income Tax Return (ITR)
Do the following procedure:
- Go to your bank’s website and fill out Credit Card application form.
- Take a photo or scan or digitized your supporting documents to be attached on your application form.
- Submit and wait for 10 – 15 days for approval or rejection notice.
If your application was rejected, it is advisable that you wait 3-6 months before applying again on other banks. Improve your credit score and organize a more appealing application document.
4. Some tips on using your Credit Card as First timers
If you get accepted and shall receive your Credit card, then Congratulations! But don’t get too excited, the real deal is about to happen. So, we’re giving you tips on how to handle your card properly.
- Make sure that you understand the Terms and Conditions written at the back of your card.
- Enroll your card in your Online Banking account to monitor your card expenses and billing.
- Pay full every month to avoid extra charges.
- Do not overspend. Your credit card is not a “Christmas bonus.” Credit cards’ goal is to make your financial life easier and more convenient but abusing it will cause you the otherwise.
- Never share your Credit Card details, even to a close family relative or friend. And store your card in a safe and secure place.
Credit card is a gift, a solution, and an answer when cash transactions go wrong. It can be a blessing of more systematized, healthier, and much stable financial practice. We just have to equip ourselves with knowledge and awareness of its benefits and danger. If we act carelessly and we spend extravagantly over our purchasing power, we can kiss goodbye to that blessing and welcome a more difficult events that will surely cause harm on your financial health and worst on your well-being. Responsibility, accountability, diligence and smart choices are the unwritten requirements of Credit Card Application, thus if you already have those plus the things we discussed earlier, then it is now the time to have yourself that Credit Card.