Bank cards come with a host of features and benefits – a good reason why charge cards are a well known phenomenon. If you are looking to apply for a bank card anytime soon, listed here are 10 things you certainly need certainly to know. These points provides you with a much better knowledge of how charge cards work and everything you can expect from them.
Annual fees on charge cards
All charge cards provided by banks (at least a significant percentage of them), come with an annual fee. The annual fee mostly varies from one card to some other, even in the case of cards provided by the same bank. Usually, Premier cards that provide better benefits than normal cards come with a higher annual fee.
While the Primary card almost certainly comes with a annual fee, supplementary cards also come with an annual fee in many cases. Sometimes, the annual fee on the supplementary card is waived for the initial couple of years – this really is to help keep the card more competitive and in-demand. Certain banks waive the annual fee on the principal card as well – for the initial year, or first couple of years, or longer.
Annual rate of interest
All transactions you make utilizing your bank card attract a particular rate of interest referred to as the annual percentage rate of interest (APR). The interest rate is influenced by the lender that’s offering the card and the type of card. The interest rate for some charge cards is Singapore is between 23% p.a. and 30% p.a.
Banks allow for a pursuit free period around 21 days from the release of the statement (again, this depends upon the lender and the type of card) and don’t charge a pursuit if the total amount is repaid in full in this interest free window. If the total amount isn’t paid before the finish of the interest free period, interest charges will accordingly hold applicable.
Cash advance charges
Bank cards enable customers to produce emergency cash withdrawals from ATMs. These cash advances carry a handling charge around 5%-6% of the withdrawn amount, besides interest charges that fall in the number between 23% and 28% p.a. Interest on cash advances is computed on a regular basis at a compounding rate before amount is repaid in full. Cash advances are generally a risky phenomenon, mostly taking into consideration the high interest charges. When you withdraw money utilizing your bank card, it is advisable that you repay the total amount in full at the earliest.
Minimum monthly payments
As a bank card customer, you are required to cover a minimum amount each month – or the whole amount if that’s possible – amounting to 3% of the total monthly outstanding balance. Minimum payments have to be created by the payment due date if late payment charges need certainly to avoided. The minimum payment in your bank card monthly statement can also include pending minimum payments from previous months, late payment charges, cash advance charges, and overlimit fees, should they hold applicable.
Late payment charges
If the minimum amount isn’t paid by the payment due date, banks levy a particular fee, commonly known as the late payment fee. The late payment fee for charge cards in Singapore can be anywhere in the number between S$40 and S$80, with regards to the bank offering the card.
Overlimit fees hold applicable and are levied by the lender if the allocated credit limit is exceeded. Overlimit fees can range between S$40 and S$60 for charge cards in Singapore.
Cashbacks and reward points
An aspect which makes credit-cards a pretty exciting phenomenon may be the reward points/cashbacks that can be earned on purchases. Different cards are structured differently and enable you to earn either cashbacks or reward points or both, on your own purchases. 신용카드현금화 Some cards enable you to earn reward points on groceries, though some other let you earn cashbacks or reward points on air ticket bookings, retail purchases, etc. Cashbacks and reward points are features which are specific to certain charge cards and the extent of benefits depends upon the type of card and the lender offering the specific card. Reward points earned on purchases can be changed into exciting vouchers, discounts and attractive shopping/retail purchase/online deals from the card’s rewards catalogue.
Certain charge cards enable you to transfer your whole bank card balance to that particular bank card account, enabling one to consolidate your debt. Balance transfer charge cards come with an interest free amount of 6 months – 1 year, with regards to the card you’ve applied for. In the event of balance transfer cards, banks charge a processing fee and might also charge a pursuit (unlikely in a lot of cases). Following the interest free period (6 months – 1 year with regards to the card), normal interest charges on the card are applicable for transactions and cash advances.
Air miles programmes in Singapore
Certain charge cards (mostly premium credit cards) provided by some banks in Singapore enable you to earn air miles by converting your reward points earned on purchases using the card. Usually, air miles cards come with a higher annual fee owing with their premium nature. As a person of a premium bank card, you can accumulate enough air mile points to completely offset the next vacation!
In brief, your credit score is really a projection of how well you’ve managed your debt in the past. It will take into account your payment patterns and records cases of late payments, credit overlimits, loan defaults, history of regular/timely payments, etc, and gives banks a notion of how good you may be at handling debt in the future. An excellent credit score is crucial to getting loan applications and bank card applications approved.
The above mentioned mentioned points comes into play handy if you’re contemplating applying for a credit card. These aspects provides you with a thorough knowledge of how charge cards work in Singapore, giving you a much better idea of everything you can expect. These will also work if you’re not happy along with your current card and are looking to modify over to some other bank card as well.