Understanding Credit Cards in Singapore
While it may only have a fairly small population for a country, the bustling city state of Singapore has an extremely credit card industry with a number of Singapore, Asian and international card issuers offering a range of cards such as the HSBC Revolution card. It’s hard to get around Singapore without exposure to credit card offers, there are posters and promotions everywhere and many of the major stores or restaurants have alliances with certain card issuers.
When looking for the best credit card offers in Singapore, here are some of the key things to understand;
Rates/APR: While the market is competitive it differs significantly from markets such as Europe and the USA where interest rates (APR) play a big factor in decision making. In Singapore the default purchase rate is offered at the same 24% APR on the vast majority of cards. While it may seem like there is nothing to compare when it comes to rates then you should check if discounts apply on large purchases from any partner stores or what the grace period is between purchasing goods and the interest charges kicking in. At the rate of 24% APR you will pay a lot of interest each year if you use credit cards as a long term way to pay goods off – try and keep your sepnding in check so you can afford to pay the bill off each month.
Annual Fees: Singapore credit cards have a nominal annual fee but it is normal for this to be waived for a number of years to new card holders. Make sure you are aware of how long the fee waiver will last for and what the annual fee will jump to at the end of this time so you don’t get caught out. If you move cards every few years or speak to your card issuer you may be able to avoid paying fees on many cards.
Rewards: Rewards are key to credit card offers in Singapore and finding the best credit card is all about finding a card that offers the best rewards to suit your spending pattern and lifestyle. Some cards offer traditional rewards schemes such as points or frequent flyer points while others offer extra discounts and rebates with partner retailers and restaurants in Singapore. Premium cards such as Platinum credit cards normally offer special privileges such as extra service or access at Singapore venues or travel and product insurances.
Rewards and privileges are the main way that the different Singapore credit cards compete with each other so the schemes are a core part of the product, not just something added on as a bonus.
Funds Transfer: Finally, one more thing to check if you have outstanding debt on other credit cards is if they allow a credit card funds transfer where you move the balance of other cards to your new card at a lower APR. Not all cards offer this facility but it becoming more common.
All the main banks now offer safe, quick and secure online applications for credit cards although they may contact you if they need further information before granting approval. If you are not a Singapore citizen then you can still apply for most cards but you will find the lending criteria is a little stricter.
Finance article by R Greenwood of creditcardapr.com.sg which compares credit cards in Singapore including funds transfer credit cards for Singapore consumers.