No Frills Credit Cards: The Benefits & Advantages

Posted September 30th, 2009 and last modified September 15th, 2014

There are so many cards to choose from, you may be wondering why you might opt for a no frills credit card above the others.

Once upon a time, all credit cards were pretty much no frills. Now, with so much competition, there are enticements galore for the new credit card customer. So why go back to basics and choose a no frills credit card?

Types of No Frills Credit Cards Include:

1. A low or zero annual fee

If you do not intend to use your credit card too much, then paying an annual fee for a reward card may not be worth it. Any points you accumulate in a year may not amount to much of an exchange gift, and may even be less than the fee you paid to get such a card. With a no frills credit card that does not carry an annual fee, you can use that money for something you genuinely want, and you will not be limited by the tie-ins that accompany reward schemes. Also bear in mind that some reward schemes have a separate fee attached to them, on top of the card’s basic annual fee.

2. Lower interest rates

A reward scheme is a partnership between the credit card company and certain enlisted retailers, companies or airlines, whose products you ultimately exchange your points for. Credit card providers pay a price for this, and this is often reflected in a higher interest rate for the customer. A no frills credit card with a low interest rate on purchases does not have those associated costs so it can keep its interest rate lower.

Although this may not concern the customer who always settles their bill in full every month, thus avoiding any interest, it does still provide the option of making that large purchase in the future and not being hit too hard for making just a low or minimum payment.

3. Less temptation to spend

Reward schemes can cause certain people to get a little carried away with their card in the pursuit of those precious points. They may even spend on items they might have by-passed without the lure of the points.

With a no frills credit card, that temptation does not exist. It is therefore easier to use the card solely for your essentials. The fact that you have a higher-spec card may even cause certain folk to hand it over as a status symbol, because having a Gold or Platinum card says something about your annual income.

A no frills credit card is about getting back to the basics of credit cards, but in a good way. It is simply there as an option should you find yourself without sufficient cash in a supermarket, for example, or if a major purchase is unavoidable and current cash flow would not allow for it.

However it is used, you will know that it is operating at a lower rate of interest. And if you don’t use it, you know that you will not be paying a high annual fee just to have it sitting in your wallet or purse. Finally, a no frills credit card may not mean exactly that; check to see if there are any attractive features attached to the card. You may be surprised.

After a no frills credit card from one of Australia’s leading financial providers?

HSBC Credit Card

No Frills Credit Card Offer

The HSBC Credit Card is a fantastic no frills credit card for making everyday transactions on provided you pay your credit card balance in full each month. This card features a $0 annual fee for the life of the card and 55 days interest free on purchases. This effectively means it could cost you nothing to use this card. HSBC's home&Away Privilege Program gives you access to discounts and benefits worldwide.

  • $0 p.a. annual fee
  • 17.99% p.a. on purchases
  • 0% p.a. for 6 months on balance transfers
  • Cash Advance Rate of 21.99% p.a.
  • Up to 55 days interest free
  • Minimum Income Requirement of $20,000 p.a.

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Credit Cards Comparison

Rates last updated October 24th, 2014
Interest rate (p.a.) Balance transfer rate (p.a.) Annual fee Cash advance rate (p.a.)
ANZ Low Rate
ANZ Low Rate
A low rate on purchases, balance transfer and a low annual fee. 13.49% p.a. 0% p.a. for 16 months $58 p.a. 21.74% p.a. Go to site More info
Citi Simplicity Card
Citi Simplicity Card
$0 annual fee credit card with a long term balance transfer offer. 19.99% p.a. 0% p.a. for 12 months $0 p.a. 19.99% p.a. Go to site More info
HSBC Platinum Credit Card
HSBC Platinum Credit Card
Earn rewards points plus a balance transfer offer. Access to prestige services including a personal concierge service and VISA Platinum reward program. 19.99% p.a. 0% p.a. for 8 months $0 p.a. 21.99% p.a. Go to site More info
Westpac Low Rate Card
Westpac Low Rate Card
A low interest rate credit card with a low annual fee and balance transfer offer. 12.49% p.a. 0% p.a. for 14 months $45 p.a. 21.49% p.a. Go to site More info
HSBC Credit Card
HSBC Credit Card
No annual fee for the life of the credit card. Plus a low balance transfer offer. 17.99% p.a. 0% p.a. for 6 months $0 p.a. 21.99% p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

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