Credit cards

Philippine Cards 101: Basic Rules and ProcessesA credit card in the Philippines is a line of loan. Usually, the credit card use to withdraw money, or present it to a business to make a purchase. The difference between a prepaid debit and loan is that for debit, the money you use is money you own, which is stored in your bank account, while on the latter, you are spending money that you own.

How get a credit card in the PhilippinesAll you need to apply to credit card is to go to a bank and ask the manager to tell you how get a credit card. Also you may chance upon an agent in malls. It is free to apply and to get one, you have to fill up an application form and provide documents like ID cards, employment certificate.

The fast way on how to get cards is to go to banks. The processing time can be as short as two weeks. The checker would submit your application details and you have to wait. Below is a list of popular banks that offer cards to consumers:

• Banco de Oro
• Union Bank
• Bank of the Philippine Islands

For first timers applying for one, the checker would ask you for more information, like proof of income, proof of address, and other documents that prove your identity. First timers have to go through this because they have no loan history yet, and the financial institutions need to validate your credibility.

If you want to know how to get fast results, you must apply for Visa or Mastercard as these are the most used brands in the country, meaning that they are accepted in all business establishments that accept payments made by credit card.

You can also get a supplementary benefit, which means your relative will also have a credit card and share the line of loan with you. All purchases that are paid for with a credit card are your responsibility.

If you want to apply online, just go to the website of the financial institution and fill up the details online. You will be asked to scan copies of your signed documents and attach them via email. You can also see a sample how the credit card looks like, and also sample calculations of fees.

Best categories of cardsMany types of cards are used in the country. Every time you pay with a credit card, you get points. The points can be used in different institutions, depending on the credit card category.

For example, you can apply for a credit card where there are miles points. Every time you make a payment, you earn points that you can later in exchange for a plane ticket, meaning you get a free ride if you have enough points.

Some give fuel points that you can exchange for gasoline, while some have generic points that you can exchange for little appliances.

These points are stored in a secured server, and you usually get emailed or texted if your points are updated. Prepaid cards do not get points.

Payments and FeesOnce you begin using credit card, there is a thing called annual fee. The usual rate is 1500 Ph per year. You also have to pay this fee for your supplementary cards. Other usual fees and interest rates that you have to pay are shown below:

Installment fees – between 31.23% and 42.50% per year
Cash Advance – about 6% of the amount of money you withdraw
Late Charges – usually 3.5% of your outstanding balance; this is charged if you did not pay on time.

There is no fee to pay if you pay your total balance before the due date. If you are also using it a lot, you can ask the provider to wave the annual fee so no fee is charged from your credit card.

The minimum monthly repayment depends by provider like Visa or Mastercard and the bank. Just remember, if you only pay the minimum, you will be charged with late fees for any outstanding balance. The best thing to do is to pay on time wholly your credit card bills.

Staying SecureTo stay secured, never say your own credit card security number. The security number is a 3-digit number found at the back side. You need to use this number if you are making virtual purchases. You also need this for when buying virtual goods like purchases in online games.

SummaryYou will not go to jail if you do not pay your loan, but you will be hounded forever by banks and collection agents. You will not go to jail because legal expenses are surely more expensive than your debt. Legal processing is not free in the country. If you do not pay, you will also not be able to borrow anymore.

Also, you are not likely to get a credit card if you have bad loan. Financial institutions in the country have an association, so they know if you are a good payer or not.