How You Can Get a Secured Credit Card
Truth be told, less than 10% of the population are actually aware that secured credit cards exist. We can’t blame them since banks in the Philippines (BPI, Metrobank, Security Bank, RCBC, Unionbank, etc.) don’t advertise secured credit cards as much as the “deadly” unsecured credit cards. Still, most major banks in the country offer secured credit cards and all you need to do is ask!
TIPS: APPLY SECURED CREDIT FIRST, THEN AFTER 4 TO 6 MONTHS APPLY REGULAR CREDIT CARD TO ANY 3RD PARTIES. (MY FIRST SECURED CARD IS BPI THEN AFTER 5 MONTHS GOT 2 GOLD (UNIONBANK AND RCBC)
Requirements (may differ from bank to bank):
- You must be at least 18 years old.
- Valid ID
- Contact number
- Proof of address (water, phone, electric bill, valid ID with address, etc.)
- TIN number ( I was approved without any TIN but you can apply for a TIN at BIR’s website)
- Cash deposit. Minimum of P10,000, depending on the bank.
|Cards Available as Secured||All except Platinum cards||All except Platinum cards||All except Platinum cards||All||All|
|Secured Card Name||Express Start||Save & Swipe||Fast Track Credit||InstaCard||Secured Visa Card|
|Minimum Cash Deposit||P10,000 (depending on the type of card)||P12,000 (depending on the type of card)||P15,000 (depending on the type of card)||P10,000 (depending on the type of card)||P12,000 (depending on the type of card)|
|Credit Limit||Up to 90% of deposit||Up to 90% of deposit||Up to 80% of deposit||Up to 100% of deposit||Up to 80% of deposit|
|Membership Fee||Depending on the type of card. Waived annual fee for the 1st year.||Depending on the type of card. Waived annual fee for the 1st year.||Depending on the type of card. Waived annual fee for the 1st year.||Depending on the type of card. Waived annual fee for the 1st year.||P1,500 per year|
|Convertible to Unsecured Credit Card?||Yes. After 12 months or less.||Yes. After 12 months or less.||Yes. After 12 months or less.||No||Yes. After 12 months or less`|
Simply bring all the requirements above and ask about each bank’s secured credit card program. The approval of your credit card application would usually take between 2-3 weeks but my secured credit card was delivered in less than 2 weeks. (Thanks, BPI!)
I would recommend applying for a secured credit card with the bank you already have a savings account on. This may expedite and guarantee the approval of your application — some people have claimed that their application was rejected but there’s no solid proof for that.
What is a Secured Credit Card?
A secured credit card has all the benefits of a regular credit card (rewards, cash advances, zero interest shopping, etc.) but it requires a cash deposit as collateral. Your credit limit would usually be 60% – 90% of your deposit, depending on your bank.
With a 90% credit limit, a deposit of P10,000 would set your card’s credit limit to P9,000.
Keep in mind that you can increase your credit limit by simply depositing more cash as collateral. If you don’t get to pay your bills, the bank simply deducts it from your cash deposit. Debt won’t surely be a problem with secured credit cards!
Benefits of a Secured Credit Card
You may be wondering why you should bother applying for a secured credit card. Unlike its ever-famous counterpart, you still need to deposit cash when applying for one. But a secured credit card is actually the“lesser evil.” It would be easier to learn how to manage debt on a secured card since your collateral would cover you if you default on a payment.
Additionally, you can easily build a good credit history too, which is very important if you plan on getting business, auto, or home loans in the future.
Below are the several benefits of a secured credit card
- 100% approval rate
- No credit investigation (you can get approved even if you have a bad or no credit history)
- No financial documents or proof of income required
- Helps you build a good credit rating
- You may convert it to an unsecured credit card after 12 months or less (and withdraw your cash deposit too!)
- You get to enjoy all of the perks of a regular credit card (rewards, 0% installment promos, cash advances, etc.)
- You can pick the type of credit card you’d like
- You can set your own credit limit
- Your cash deposit earns interest
Yes, your cash deposit can be withdrawn after you build a good credit rating and convert your secured credit card into an unsecured one. You may speak with your bank after 12 months or less and request to convert your credit card.