Credit cards come with a host of features and benefits – a good reason why bank cards are a popular phenomenon. If you should be looking to utilize for a charge card any time soon, here are 10 things you actually need certainly to know. These points will give you a better knowledge of how bank cards work and everything you can expect from them.
Annual fees on bank cards
All bank cards made available from banks (at least a major percentage of them), include an annual fee. The annual fee mostly varies from one card to some other, even in the event of cards made available from exactly the same bank. Usually, Premier cards offering better benefits than normal cards come with a higher annual fee.
Whilst the Primary card almost certainly comes with an annual fee, supplementary cards also include an annual fee in many cases. Sometimes, the annual fee on the supplementary card is waived for the first year or so – that 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 first year, or first two years, or longer.
Annual rate of interest
All transactions you make using your bank card attract a specific rate of interest called the annual percentage rate of interest (APR). The interest rate is dependent on the bank that’s offering the card and the type of card. The interest rate for most bank cards is Singapore is between 23% p.a. and 30% p.a.
Banks permit an interest free period of about 21 days from the release of the statement (again, this is dependent upon the bank and the type of card) and don’t charge an interest if the quantity is repaid completely in this interest free window. If the quantity isn’t paid before the finish of the interest free period, interest charges will accordingly hold applicable.
Cash advance charges
Credit cards enable customers to create emergency cash withdrawals from ATMs. These cash advances carry a handling charge of about 5%-6% of the withdrawn amount, besides interest charges that fall in the range between 23% and 28% p.a. Interest on cash advances is computed on a daily basis at a compounding rate until the amount is repaid in full. Cash advances usually are a risky phenomenon, mostly taking into consideration the high interest charges. When you withdraw money using your bank card, it’s advisable that you repay the quantity completely at the earliest.
Minimum monthly payments
As a charge card customer, you’re required to cover the absolute minimum amount monthly – or the entire amount if that’s possible – amounting to 3% of the full total monthly outstanding balance. Minimum payments have to be created by the payment deadline if late payment charges need 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, if they hold applicable.
Late payment charges
If the minimum amount isn’t paid by the payment deadline, banks levy a specific fee, commonly referred to as the late payment fee. The late payment fee for bank cards in Singapore can be anywhere in the range between S$40 and S$80, with regards to the bank offering the card.
Overlimit fees hold applicable and are levied by the bank if the allocated credit limit is exceeded. Overlimit fees can range between S$40 and S$60 for bank cards in Singapore.
Cashbacks and reward points
An aspect which makes credit-cards a pretty exciting phenomenon is the reward points/cashbacks which can be earned on purchases. Different cards are structured differently and allow you to earn either cashbacks or reward points or both, in your purchases. 신용카드 현금화 Some cards allow you to earn reward points on groceries, while some other let you earn cashbacks or reward points on air ticket bookings, retail purchases, etc. Cashbacks and reward points are features which can be specific to certain bank cards and the extent of benefits is dependent upon the type of card and the bank 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 bank cards allow you to transfer your entire bank card balance to that one bank card account, enabling you to consolidate your debt. Balance transfer bank cards include an interest free amount of 6 months – 1 year, with regards to the card you’ve applied for. In the case of balance transfer cards, banks charge a processing fee and may also charge an interest (unlikely in most cases). After 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 bank cards (mostly premium credit cards) made available from some banks in Singapore allow you to earn air miles by converting your reward points earned on purchases utilizing the card. Usually, air miles cards come with a higher annual fee owing for their premium nature. As a person of reasonably limited bank card, you can accumulate enough air mile points to totally offset your following vacation!
In brief, your credit score is just a projection of how well you’ve managed your debt in the past. It will take under consideration your payment patterns and records cases of late payments, credit overlimits, loan defaults, history of regular/timely payments, etc, and gives banks an idea of how good you can be at handling debt in the future. A good credit score is imperative to getting loan applications and bank card applications approved.
The above mentioned points will come in handy if you should be contemplating applying for a credit card. These aspects will give you a comprehensive knowledge of how bank cards work in Singapore, giving you a better idea of everything you can expect. These will even work if you should be not happy along with your current card and are looking to modify over to some other bank card as well.