You are going to be a good credit card user! Let’s check how to apply first!

Nowadays, credit card has become one of the more flexible and convenient financial tools that allow you to purchase goods or services.With the current situation of the pandemic, using a credit card is a much safer choice than using money to pay for your purchases. 

If you’re deciding to get your first credit card, you need to have a better understanding of credit cards so you canmaximize your spending power.Here’s a simple guide to help you before you apply for a credit card.

Types of Credit Cards

As there are many types of credit cards that are being offered by various bank institutions, find out which type of credit card will suit your needs and lifestyle.

Basic Credit Card

A basic credit card gives consumers acredit limit.

Credit card limit – the maximum credit amount thatone can use to spend on online or in-store purchases. Some credit card companies offer low-interest rates and waived annual fees for the first year. Make sure that you read the terms and conditions before signing up.

Credit Card with Rewards

This type of credit card canearn incentives or a point systemeach time the card is used by the user. Some example of this type of credit card are:

• Cash Back credit cards – Cash is earned back when the card is frequently used
• Airline mile or frequent flier credit cards –The point system is gained from the accumulated miles wherein the user can gain travel-related rewards such as free flights, use of VIP lounge, etc.
• Co-branded credit cards – A co-branded credit card is a card that is linked to a brand. Such kind of credit card helps maximize one’s savings while using the card because of the perks, freebies, discounts, etc.

Balance Transfer Credit Card

The card offers this Balance Transfer Program.The Balance Transfer Program allows the qualified user toconsolidate and move their existing loan/debt to the new credit card, which typically offers a much lower interest rate.

Credit Card Benefits

Owning a credit card can be very exciting. If a credit card is used responsibly, its user will surely find value in having one.

• Convenient. No need to go to an ATM to withdraw money. All you have to do is swipe and sign the receipt!
• Flexible. Purchases whether online or in-store can be done with a credit card. You can now pay for big-ticket items such as gadgets, appliances, school fees without a hassle.
• Secure. Carrying too much cash in your wallet can be dangerous. With a credit card, you can have peace of mind when shopping in-store. Unlike cash, you can immediately report a stolen card to have it blocked and avoid unauthorized use.
• For Emergencies. Sudden expenses can be daunting but thanks to a credit card, unforeseen expenses such as medical bills can be covered.

How to Apply for a Credit Card

Qualification

• Age – At least 21 years old
• Citizenship – Filipino citizen or foreigner living in the Philippines
• Gross annual income – At least Php 120,000 to Php 1,000,000
• Contact number – An active landline number and mobile number
• Valid Taxpayer Identification Number (TIN)
• Employment Status – At least 1-year regular employment status or at least 2 years of profitable business for self-employed individuals

Make sure you meet these qualifications before you proceed to apply for your credit card.

Required Documents When Applying for a Credit Card

• Valid ID
• Latest BIR 2316, Certificate of Employment, latest payslip (for Employed applicants)
• Latest BIR 1701, latest financial statement (for Self-Employed applicants)
• Alien Certificate of Registration or Immigrant Certificate of Registration and Work Permits (for foreigner residents)

Don’t forget these documents when you submit your credit card application! 

Where to Apply for a Credit Card

Online

• Visit the bank’s website
• Fill out the application form and select your preferred credit card
• Upload the scanned copies of the required documents
• Once completed, click on the “Submit” button

Bank

• Go to the nearest or preferred bank branch
• Fill out an application form
• Submit a photocopy of the required documents. Be ready to present the original copies of the required documents to the bank staff for verification purposes.

Final Thoughts

Owning a credit card can be a rewarding experience when you are careful and purposive in your credit card spending. Make sure to spend meticulously, track your spending and pay on the set due date for a smooth sailing lifestyle.