Credit Card FAQs

A credit card lets you pay for purchases both in shops and online without paying cash. You usually get slightly more than a month to pay that amount back to the bank without incurring any interest. However, if you do not pay the full sum before the due date, an interest (up to 24% - 28% per annum.) is charged on the outstanding amount. Banks usually require you to pay a minimum sum each month.

You can apply for a credit card online or through forms available at banks or shopping malls. Fill up the personal details required, submit the relevant documents and wait for the application to be approved.

When you apply for a credit card, you get a credit limit, which is usually two to four times your monthly salary. You draw down on this credit limit when you make purchases and then repay the bank at the end of the month. With a debit card, however, the exact purchase amount is deducted directly from an account that's linked to the debit card. If there are insufficient funds in the account, the transaction will not go through.

You must be at least 21 years old to apply for a credit card. Some banks allow student credit cards to be issued to those aged 18. The minimum age for a supplementary card holder is also 18 years old.

A minimum income of $30,000 per year is required to apply for a basic credit card. Income requirements may be higher if you're a Permanent Resident or foreigner. Your credit score from Credit Bureau Singapore has a big say in whether the bank issues you a credit card and the credit limit you're given. When you apply for a credit card, you'll need to have photocopies of either your passport or NRIC as well as your latest monthly income statements or annual income tax assessment.

You can apply for a credit card with no credit history at all. You simply need to provide proof of your income. You can do that in a number of ways. The best is to submit your Notice of Assessment from the IRAS as it states your total earnings for the past year. You also need to provide copies of the three most recent payslips to prove you're currently employed. Some credit card applications may also require you to submit proof of your monthly CPF contributions. The fact that you have no outstanding loans in your name also works in your favour when you apply for a credit card.

The processing time varies from bank to bank. Generally, when you apply for a credit card, it can take between three to five weeks for the application to be processed. Once the credit card application is approved, it takes between three to 10 days for the credit card to arrive in your mailbox. To speed up your application, ensure all your relevant documents are in order when you first apply for the credit card.

When you apply for a credit card, you are granted a credit limit. It is the maximum amount you can charge to your card or any other credit facility with the same bank. Any amount charged in excess of the credit limit will be rejected. Your maximum credit limit is restored once you have made all outstanding payments.

The first thing banks look at when you apply for a credit card is your income. Banks usually grant a credit limit of two to four times your monthly salary. However, the amount can vary from bank to bank. Your credit limit is also determined by your credit score from Credit Bureau Singapore. If you have a good credit score, you are more likely to receive the maximum credit limit when your credit card application is approved. So, it's best to have as few outstanding loans as possible when you apply for a credit card.

Call the bank to ask for a review of your credit limit. If your income has increased since you first applied for a credit card, submit your new income statements. Banks are also more likely to increase your credit limit if you are prompt in your repayments. So keep your credit card account in order from the very first day you apply for a credit card.

You can apply for as many credit cards as you want. If the cards are from the same bank, the original credit limit will be shared between all the cards. If you apply for credit cards with different banks, you will be granted a new limit each time. Keep track of how much you spend and when the bills are due. Missing a payment results in hefty interest charges and it can hurt your credit score, which in turn impacts your credit limit the next time you apply for a credit card or loan facility.

Every credit card comes with an annual fee (also known as maintenance fee) in return for services provided by the bank. Most banks are able to waive off the annual fee if you have a clean repayment record and if you're a long-time customer. However, if you request for an annual fee waiver, you may not be able to qualify for certain promotions, incentives or rewards awarded by the bank.

You can settle your monthly credit card bills via Internet banking, GIRO, phone banking, cheque or in cash at the branch itself. The most convenient method is to create a GIRO payment mode when you apply for the credit card. So, the outstanding balance is automatically deducted every month from one of your accounts.

The minimum payment is a monthly sum you have to pay each month in order to avoid getting a bad credit score. It's calculated based on your outstanding credit card balance and will appear in your monthly statement. Usually, the minimum payment is 3% to 5% of the total outstanding amount or $50, whichever is higher. If you only pay the minimum amount on your monthly bill, interest is charged on the outstanding amount. This will be carried over to your next statement. If you fail to pay the minimum fee, a late payment fee will be charged, on top of the interest on the outstanding balance. A good practice is to always settle your monthly credit card bill in full so as not to incur hefty interest charges.