Bank cards come with a host of features and benefits – a good reason why credit cards are a favorite phenomenon. If you are looking to use for a charge card any time soon, listed here are 10 things you actually have to know. These points provides you with a much better comprehension of how credit cards work and everything you can expect from them.
Annual fees on credit cards
All credit cards provided by banks (at least a significant percentage of them), come with an annual fee. The annual fee mostly varies in one card to some other, even in the case of cards provided by the exact same bank. Usually, Premier cards that provide better benefits than normal cards come with a higher annual fee.
Whilst the Primary card probably comes with a annual fee, supplementary cards also come with an annual fee in most 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 primary card as well – for the first year, or first couple of years, or longer.
Annual rate of interest
All transactions you make making use of your charge card attract a certain rate of interest referred to as the annual percentage rate of interest (APR). The interest rate is influenced by the lender that’s offering the card and the sort of card. The interest rate for some credit cards is Singapore is between 23% p.a. and 30% p.a.
Banks permit an interest free period of approximately 21 days from the release of the statement (again, this depends upon the lender and the sort of card) and don’t charge an interest if the quantity is repaid entirely through 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
Bank cards enable customers to create emergency cash withdrawals from ATMs. These cash advances carry a handling charge of approximately 5%-6% of the withdrawn amount, besides interest charges that fall in the product range between 23% and 28% p.a. Interest on cash advances is computed on a daily basis at a compounding rate before amount is repaid in full. Cash advances usually are a risky phenomenon, mostly considering the high interest charges. When you withdraw money making use of your charge card, it’s advisable that you repay the quantity entirely at the earliest.
Minimum monthly payments
As a charge card customer, you’re required to pay a minimum amount monthly – or the entire amount if that’s possible – amounting to 3% of the sum total monthly outstanding balance. Minimum payments need to be produced by the payment deadline if late payment charges need certainly to avoided. The minimum payment in your charge card monthly statement can also include pending minimum payments from previous months, late payment charges, cash advance charges, and overlimit fees, when they hold applicable.
Late payment charges
If the minimum amount isn’t paid by the payment deadline, banks levy a certain fee, commonly known as the late payment fee. The late payment fee for credit cards in Singapore can be anywhere in the product range between S$40 and S$80, with regards to the bank offering the card.
Overlimit fees hold applicable and are levied by the lender if the allocated credit limit is exceeded. Overlimit fees can range between S$40 and S$60 for credit cards in Singapore.
Cashbacks and reward points
An aspect which makes credit-cards a pretty exciting phenomenon could be the reward points/cashbacks which can be earned on purchases. Different cards are structured differently and permit you to earn either cashbacks or reward points or both, in your purchases. Some cards permit you to earn reward points on groceries, though some other let you earn cashbacks or reward points on air ticket bookings, retail purchases, etc. Cashbacks and reward points are features that are specific to certain credit cards and the extent of benefits depends upon the sort of card and the lender 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 credit cards permit you to transfer your complete charge card balance to that one charge card account, enabling one to consolidate your debt. Balance transfer credit cards come with an interest free amount of 6 months – 1 year, 카드깡 with regards to the card you’ve applied for. In case of balance transfer cards, banks charge a processing fee and may also charge an interest (unlikely in a majority of 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 credit cards (mostly premium credit cards) provided by some banks in Singapore permit 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 customer of reduced charge card, you are able to accumulate enough air mile points to totally offset the next vacation!
In brief, your credit score is a projection of how well you’ve managed your debt in the past. It takes under consideration your payment patterns and records instances of late payments, credit overlimits, loan defaults, history of regular/timely payments, etc, and gives banks a notion of how good you may be at handling debt in the future. An excellent credit score is imperative to getting loan applications and charge card applications approved.
The above mentioned mentioned points will be handy if you’re contemplating applying for a credit card. These aspects provides you with an extensive comprehension of how credit cards work in Singapore, giving you a much better idea of everything you can expect. These may also work if you’re not happy along with your current card and are looking to modify over to some other charge card as well.