Financial management is and will always be a matter of concern for everybody. If you are a college or university student, obtaining a credit card is the best way of building a good credit history.
What will this article cover?
- What are the things you need to do to successfully get a card?
- What tips will ensure you have a better chance of getting one.
- Why are these techniques going to work?
- Who has done this before and what results did they get? Who provides the cards?
- How do you apply for a card?
With each passing year, more and more students are opting for student credit cards. It is very thrilling for a student to get hold of their first credit card, and use the piece of plastic to get whatever they want, at the swipe of a card. However, being a student you should be aware of the pitfalls associated to owning a credit card. Hence, it is always suggested to get hold of a credit card from a reliable company.
Student Credit Cards
Rates last updated January 28th, 2015
Factors to be considered while applying for a card
Many banks have easy to follow eligibility criteria for a student credit card. Most of the Australian banks require proof that you are a student.. A student card would be good proof and will confirm the fact that you are enrolled in a 2-year or 4-year University or college course and that you have a reliable source of income.
The bank needs to know your full name, occupation, residential address. If according to the rules of a particular bank, you are allowed to opt for a secondary credit card, you will have to mention the details of the secondary cardholder.
Having a part-time or full-time job is not considered a prerequisite, as very often children ask their parents to pay their bills whenever they fall behind on payments or have oversized balances. Besides, credit card companies are aware that students don’t have high earnings during their educational tenure. On the other hand, they also know that things change for good once students get their graduation degrees.
If you are planning to opt for a student credit card, the credit card company would ask for a co-signer who would act as collateral, a form of insurance. This would be the person the company would fall back on if you were unable to repay the debt. This could be your guardian, parent, or any family member.
Before you select a credit card, you should compare the interest rates offered by the various student credit cards companies. Enquire about the introductory rate and the rate levied after the end of the introductory period. Also, take a look at the credit card charges for annual fees, late fees, and other fees associated with charges levied over the present credit limit.
Many credit cards award you with added benefits, like reward points or cash back on your purchases. Reward points can accumulate into nice additional perks eventually.
Make certain that the benefits you have been awarded do not have any exorbitant fees or higher rates.
Tips for acquiring a reliable credit card
- Always opt for credit cards with reasonably low limits. Choosing a student credit card with a high limit is not advisable for unemployed students as they are notoriously famous for splurging on shopping sprees.
- Don’t forget, the credit is meant to establish the foundation for a good credit rating, it is not your source of income. Always maintain a low balance and repay bills regularly.
- Student credit cards are known for their low interest rates. Many companies would offer 0% Annual Percentage Rate (APR) for the initial 6 months. This is the best time to make purchases. However, make sure you check for the rates after the first 6 months. If the company levies a high rate of interest, it is advisable you switch to another card that offers a low rate.
- Look for credit cards with an online management system. When you have easy access to your account via the Internet, you can check your financial status from time to time and use the rewards more often.
- Some companies have certain policies when it comes to a Lost Credit Card’. This would protect your account even when your wallet is stolen or is lost.
Prepaid Credit Cards Comparison
|Provider||Details||Card Issue Fee||Load/Reload Fee||Monthly Service Fee||Apply|
Woolworths Reloadable MasterCard
You have the choice of two fee options:
Option A – Monthly
Option B – Pay as you LOAD
$0 Option A
$1 Option B
$1 Option A
$0 Option B
Various Student Credit Cards Providers in Australia
Westpac bank has an excellent offer for full-time tertiary students from an established tertiary college or institution. This is best for students who are not working full-time or have to change their address often. In short, it’s best for students who cannot qualify to the standard norms for a student credit card application.
With the Westpac Low Rate Card students get 55 days interest free on their credit purchases and have to pay an annual fee of $59 for the initial year. Students are offered an Interest rate of 13.49% p.a.
Students can apply online from the official site
Bankwest, the Bank of Western Australia offers the Bankwest Breeze MasterCard as a Student Credit card. According to the terms of the credit card application
- Students should be at least 18 yrs old and a resident of Australia
- Students are expected to hold a BankWEst Student Transaction Account.
- They should be a full-time student at UWA, ECU, Murdoch, Notre Dame, or Curtin.
- Students should at least be in their 2nd year of study
- Clear credit history
Bankwest Breeze MasterCard offers an up to 55 days interest free. Card holders are charged 0% p.a. for 4 months balance transfers. The annual fee is $59.
Commonwealth Bank Student credit card
The commonwealth bank offers options for TAFE or Full-Time tertiary students. According to the rules of the application process
- The student should open a streamline account with the Commonwealth Bank and register the necessary details with any branch of the bank
- Authenticate the full-time student status by showing your student id card or a letter of enrolment.
- Students need 100 ID points to qualify for an application.
Given below are the 100 points needed for opening an account
|Type of Identification
|Passport or birth certificate||70|
|Student ID (with photo)||40|
|Australian Drivers License||40|
|Other bank credit card, debit card or passbook(only one allowed per bank other than the Commonwealth Bank)||25|
|Other identification documents (e.g. library card, health fund card)||25|
A special feature of this student credit card is that students don’t have to pay withdrawal fees and monthly account fees. There is also no annual credit card fee.
You can download the application form
Although no direct student credit card offers exist, students who can pass the application requirements can benefit greatly from the lowest interest rate available for online application.
NAB Student card
To be eligible for NAB Student Card, students should
- Above 18 years old
- Enrolled as a full-time student at a University, Secondary, Agricultural or TAFE College
- Possess a current Student ID card
Students can gain access to NAB branch withdrawals and deposits, NAB Telephone banking, NAB Internet Banking, NAB ATMs (a nominal fee is charged for non-NAB ATMs), NAB Visa Debit and EFTPOS.
Student Credit Card Application Procedure
- Get in touch with the bank and enquire about all the information needed
- Give them all the necessary details
- Outline your present financial details
- Verify the entered details and submit the completed form to the bank
- When your application has been approved, you will be awarded with a Credit Card.Thereafter a balance transfer facility will be activated for your use.
Important things to consider when applying
During the online application process, the credit card providing bank asks the applicants to provide significant info necessary for the assessment of the applications.
Don’t forget you allow the bank to acquire information pertaining to you from the credit reporting agencies. This includes details of your credit history and credit worthiness. The bank holds all the rights to exchange the provided information to credit reporting agencies, other credit providers, and its referees.
As per the rules put forth by the privacy act of the bank, some of this information is entrusted to a credit-reporting agency. Review your information before you submit. The credit reporting company will include history of bill payments and delays in payments in your credit history. If you accidentally provide incomplete, inaccurate, or outdated information, you might have a problem when you get your credit reports.
The application process would take approximately 20 minutes if done online. You will be instantly informed when the application has been submitted. Take note that banks follow a 35-minute time out session for security purposes. If you happen to leave the application window open for 30 minutes without entering any details it would time out and you will have to start it all over again
Make a sensible decision before selecting your credit card. When you get hold of the credit card, you would have to be extra careful about your finances.
When you finally start using the credit card, ensure that you stay within your credit limit to reserve available credit for emergencies and avoid penalties. When you avoid debts on your student credit card, you will be able to build a good credit history, and this will be a key factor in the future of your credit history and your ability to get a mortgage for a house.