Applying for a credit card can give you access to an amazing financial tool that will change your life for the better- or get you stuck in a debt trap very fast. Responsible credit card usage is a great stepping stone to better financial opportunities, but only if you use it properly and with your financial growth in mind. If you simply see it as ‘free money’ to spend and immediately max out your balance, you will be hindering yourself more than you will be helping. If you have decided that a credit card is the right financial product for you, however, we are here today to guide you through the application process.
How To Apply For A Credit Card
In South Africa, there is a wealth of credit card products. Many are offered directly through the banks, now including Capitec. However, you will find credit card products on offer from many other financial institutions, including stores like Truworths and Woolworths, and even independent institutions like Virgin Money. Regardless of the ‘wrapper’ on the card, they will either be a Mastercard-backed product or one backed by Visa. These 2 credit card powerhouses are globally recognized and trusted.
Before you apply for a credit card, you need to carefully consider the products on offer, and find the best match to your needs and current financial circumstances. Typically, you will be offered a relatively low balance at first, especially if you are new to credit. Don’t fixate on this too much- if you show good financial behavior with the balance you get, you can apply for limit increases later on.
Once you have identified up to 3 credit cards for which you fit the profile and criteria, you will start a credit card application. This can be initiated online for almost all credit cards today. The bank will then conduct a credit check and decide if they will offer you a credit card.
What Are The Requirements To Qualify For A Credit Card?
Every credit card product on offer in South Africa will need you to be a South African citizen or legal resident with a valid ID, over the age of 18. You will also need to consent to credit checks and provide your salary information to the bank to determine your initial limit and ability to take on new debt. Typically, your credit record will be used to determine the interest rate you are offered on the card.
What will vary is the basic salary requirements for the card. Typically, you will need to be earning at least R4000 in take-home pay to qualify for any credit card. Some ‘elite’ card tiers will have much more stringent salary expectations. Some lenders will happily work with the self-employed and entrepreneurs, while others will only offer products to formally salaried individuals.
A hidden factor will also be your credit score. It is difficult to obtain any loan product, let alone an unsecured line like a credit card, if your credit score is not 640 or higher.
Which Bank Is Best For Credit Cards?
While the traditional ‘Big 4’ banks (Standard Bank, FNB, Nedbank, and ABSA) are the best-known banks for credit cards in South Africa, that doesn’t mean you should see them as the default. Smaller banks, like Capitec, and ‘private’ banks like Investec, focus on different target markets, and you may fit their profile perfectly. There are also non-bank credit cards that are equally safe and reliable. Remember that most credit cards are backed by either Mastercard or Visa in the end.
Ask yourself if there are any rewards, perk programs (like eBucks), or special offers you can leverage by choosing a specific bank. Then engage with them on the qualification criteria and interest rate they will offer you. These are much more important than what bank name is on the front of the card.
How Much Money Do You Need To Be Approved For A Credit Card?
Credit card products in South Africa vary significantly. There are entry-level products designed for almost anyone to access, right through to ‘elite’ products with preferential interest and plenty of perks for high-income individuals. However, even entry-level products will typically want to see a salary of at least R4000 after tax to consider you for credit card approval.
Which Bank Is Easy To Get A Credit Card?
If you have a great credit score, the credit card world is your oyster. If your score is bad, your chances of approval anywhere are low. Remember that financial products in South Africa are much better regulated than in many other countries. Under the surface, most financial institutions and banks will conduct the same credit checks with the same bureaus, and use very similar criteria for their products. So no one bank is guaranteed to hand out a credit card if you ask.
However, for salaried individuals, Capitec specifically pitches its credit card as a product for low-income earners and non-traditional bank clients. This might make it more accessible for you. If you don’t earn a set monthly salary, you might like to consider the ABSA Gold credit card product, as it has similarly low entrance criteria and is more ‘friendly’ to the self-employed and entrepreneurs than the other Big 4 banks.
