Credit Cards for Students

Credit Cards for Students

As a student you live on a budget as best you can with tight finances, but are credit cards for students the best way to go? How do you apply for credit cards for students and how do they work?



There are some banks that offer credit cards for students. These cards do not have a huge credit limit on them as it is assumed that a student isn’t earning enough money or any at all to repay any debt.

The interest rates on these cards are quite high, but they are useful under the right circumstances.

Credit Card Advantages

When you make a purchase with your credit card you are more protected then with a debit card. If there is a problem with the purchase and the supplier won’t handle the situation you can claim a refund from your credit card provider.

Also having a credit card as a student means that you can start to build up a credit history which you may need in the future so that you can apply for loans.

Your credit history and score will depend on you repaying the balance each month and on time. As a student you need to be sensible and also know that this will impact your future finances.

What are Credit Cards for Students?

When you apply for a student credit card, lenders know that you will not have a credit score. Credit card providers will have specially designed credit cards for students so that you are able to build a credit history.

Credit cards for students will often have promotional bonuses and reward points. Also you will need to shop around so that you are able to get the best interest rate which can be high as you are considered a risk still.

Applying for a student credit card and being approved is far easier than for a normal credit card because of they will not need a lengthy credit history or any at all and also they do not need to you to have a certain income.

If you have little to no credit history, it might be better to look at a secured credit card. With this card you can still build a credit history which will help in the future.

Good Credit Card Habits

As a student this will most likely be your first credit card, so you should get into some good habits if you are going to have the responsibility of a credit card.

• Each month you are required to pay a minimum repayment, but rather try and pay the balance in full each month. This way you will not need to pay any interest.
• You need to avoid withdrawing from an ATM with your credit card as the fees attached to doing this are extremely high. Also cash withdrawals bring about a higher interest than purchases.

If you earn a steady income as a student then it might be wiser to apply for a standard card instead of a student card.

You will have more flexibility, lower interest and other perks that you may not see with a student credit card.

Credit cards for students can do more damage than good, because if you are unable to clear your balance each month you will not only have the interest but also late payment charges, charges for exceeding your limit and also if you use it overseas you will most likely be charged for this as well.

You need to ensure that you pay the full balance each month on your credit card for students so that you get a healthy credit score built and you are in control of the card, not the card in control of you.

SureSwipe in South Africa are merchant credit card providers, but they can offer great advice in various areas.