Compare credit cards for low income earners in Australia and find a card that suits your financial situation.
Although credit cards play a significant role in many people’s day-to-day transactions, it can be a challenge for individual’s with a low income to find the right card for them. However, there are still a number of valuable cards on offer to those in the lower income bracket. Most low income cards also keep fees and charges to a minimum, and some even come with introductory interest rate offers. Use this guide to compare your options and find a card that is eligible with your income today.
What are the features of a low income credit card?
- Lower minimum income requirements. As the name suggests, low income credit cards usually have lower minimum income requirements starting at $15,000 p.a.
- Lower annual fee. Low income credit cards usually come with lower annual account keeping fees than more premium cards. You might even be able to find a low income card that doesn’t charge ongoing annual fees or has a $0 annual fee promotional offer.
- Lower interest rate. Low income cards tend to double as low rate cards, and there’s a good possibility of finding a card that charges a purchase rate of less than 12% p.a. Look out for low income cards with low or 0% promotional interest rates as well.
- Interest-free days. Most low income cards offer interest-free days on purchases, though the number of days (such as up to 55 days) would vary from card to card. To take advantage of these interest-free days, you have to pay your account’s closing balance completely every month.
- No frills features. Since such cards keep the fees and interest rates low, most don’t offer extras like rewards, access to a concierge service, travel benefits, and complimentary insurance covers.
What are the benefits of using a low income credit card?
- Realistic eligibility requirements. Your annual income is one of the many factors a lender will consider when reviewing your credit card application. So, you’ll have increased chances of approval when applying for a card that you meet the income requirement for.
- Lower fees and rates. Low income credit cards usually come with fewer extra features, so it’s likely the card will also come with lower fees and rates, helping to keep your card costs to a minimum.
- Global acceptance. Most low income credit cards in Australia come with Visa or MasterCard affiliations, so you can look forward to using any such card when travelling overseas. When you use your card overseas, you would, in all likelihood, have to pay international transaction fees.
- Transfer balances. If you’re struggling to repay a debt, many low income credit cards come with 0% balance transfer offers for up to 18 months.
- Build credit. If you’re using a low income credit card with low interest rates, you could use the card to build up a healthy credit rating if you pay off your debt each statement period. With good creditworthiness, you’ll have increased chances of approval when applying for other loans in the future.
What should I consider when comparing for a low income credit card?
Applying for a low income credit card requires that you pay attention to certain important aspects, and here’s what you need to know:
- Minimum income requirements. Not all cards have the same minimum income requirements. While some allow applications from individuals who earn $15,000 p.a. or more, some others increase this requirement to $20,000 or $25,000.
- Earnings. If you don’t meet the minimum income requirement of any given credit card, you still have options. You can, for instance, add your spouse’s income to your income as the total household earning, and this is something banks can work with. If this is not an option, start by opening a transaction account and try to increase your work hours for a few months so you can meet minimum income requirements.
- Credit history. If you suffer from a poor credit history, work on repairing your credit before applying for a credit card. You can consider getting a temporary part-time job to increase your monthly income. Making sure you provide all the required information in your application also increases chances of approval.
- Affordability. Before you apply for the card, make sure you’ve confirmed if you can afford it. If you end up borrowing more than you can repay and build up debt, this will have a negative impact on your credit rating. Use the reviews on finder and read the relevant product disclosure statement to make sure you understand the costs of the card before applying.
Low Minimum Income Credit Card Offer
The Westpac Low Rate Visa offers low interest rates on balance transfers and purchases, plus a competitive annual fee. You can also use paperless eStatements to have your bills electronically delivered, saving paper and time.
- $59 p.a. annual fee
- 1% p.a. for 12 months (reverts to 13.49% p.a.) on purchases
- 0% p.a. for 16 months on balance transfers
- Cash Advance Rate of 21.49% p.a.
- Up to 55 days interest free
- Minimum Income Requirement of $15,000 p.a.
Low Income Credit Cards Comparison
Rates last updated October 25th, 2016.
- ME Bank frank Credit Card
Interest rate changed from 9.99% p.a. to 11.99% p.a. on purchases, balance transfers and cash advanc
September 19th, 2016
- Virgin No Annual Fee Credit Card
Balance transfer offer has been extended to 31 October 2016.
September 26th, 2016
- Westpac Low Rate Card
Promotional BT period has been changed from 18 to 16 months and is valid until 30 January 2017.
October 12th, 2016
Frequently asked questions about low income credit cards
What eligibility criteria do I have to meet to apply?
Apart from meeting minimum income requirements, you should be at least 18 years old, a permanent Australian resident and have a healthy credit history.
How quickly can I complete the application?
If you wish to submit an online application and have the required information at hand, the process should take around 10 to 15 minutes, depending on the card provider.
Do low income cards provide rewards?
The norm is that they don’t, but the ANZ Frequent Flyer credit card is a low income card that comes linked to the Qantas Frequent Flyer program.
Do I have to pay a fee for balance transfers?
This depends on the credit card you choose. While some cards offer fee-free balance transfers, some others might require you to pay a one or two percent balance transfer fee.