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How to Choose the Right Credit Card in Singapore 2024

how to choose credit card singapore
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Finding the perfect credit card in Singapore can be overwhelming with the abundance of options available. Whether you’re seeking cashback rewards, travel perks, or exclusive discounts, selecting the right card requires careful consideration of your spending habits and personal preferences. 

In this guide, we’ll explore the different types of credit cards, such as cashback, miles, and rewards cards, and highlight some of the best products in the market. 

How Does a Credit Card Work?

A credit card acts as a credit line provided by a bank, allowing you to borrow money for purchases. Instead of paying upfront, you have the convenience of repaying the borrowed amount at a later date, typically through monthly credit card bills. 

These bills outline your transactions, including the borrowed amount, and may also include interest charges and other fees.

Credit Card Benefits

  • Credit cards offer you an easy way to borrow cash.
  • You can spread the costs of what you’ve borrowed over easy monthly payments.
  • Many credit cards let you earn rewards, points, or air miles.
  • A credit card can help you to “rebuild” a bad credit history.

Credit Card Disadvantages

  • Credit card minimum payment terms apply, which you’ll need to hit monthly.
  • Interest is charged daily on your outstanding balance if you make only the minimum payment.
  • Your credit history or credit rating could be damaged if you don’t make timely payments.
  • You could end up in debt if you’re not careful.
close up hand holding credit card

Three Key Types of Credit Cards

In Singapore, credit cards come in various types, catering to different needs and preferences. From student credit cards and airline miles cards to cashback and rewards cards, there is a wide range of options available. Let’s explore the three most popular types of credit cards you’ll find in Singapore:

1. Air Miles Credit Cards

An air miles credit card acts much in the same way as a regular credit card, except you’ll be able to earn bonus miles or airport-related reward points with affiliated airlines. These points can usually be redeemed for the likes of flights or airport lounge access.

2. Cashback Credit Cards

Put simply, a cashback credit card is a card that enables you to earn some extra money in the form of cash rebates with every little bit of local spend or online spend. The best cashback credit cards offer great potential so long as you pay off your full balance each month so that your interest doesn’t outweigh your rewards.

3. Rewards Credit Cards

A rewards credit card is much like a cashback credit card, though you’ll receive your rewards as credit card rewards points for every dollar spent, rather than as cash rebates. Your points can be used for anything from online food delivery discounts to hotel bookings, depending on the card issuer and their T&Cs.

How to Choose the Best Credit Card for You

To choose the best credit card, determine your spending habits and goals, consider the card type you need, compare fees and charges, look for relevant promotions, and review the terms and conditions. Conduct thorough research to find a card that aligns with your needs and offers the most value.

1. Determine Your Minimum Spend Habits and Financial Goals

Figuring out what kind of minimum spend you’re likely to hit each month and what you intend to use your credit card for will put you in a better position for comparing the most appropriate credit card deals.

2. Consider the Type of Credit Card You Need

Of all the credit cards available, from cashback to air miles, which best suits you? Consider things like whether you need a higher credit limit, or what kind of bonus points you’re most interested in, too.

3. Compare Credit Card Fees and Charges

All credit cards have fees. Opt for a card that won’t hit you with high fees on your most likely everyday purchases. If you have a high foreign currency spend, for example, seek out a card with lower foreign transaction fees.

4. Check for Promotions and Bonuses

Look out for promotions that suitably match your needs. If you’re into online shopping, maybe you can find a product offering credit card promotions or cash rebates with your favorite online stores, for example.

5. Read the T&Cs Regarding Interest Rates, Fees, and Reward Programs

When that monthly bill comes in, you will need to pay interest. Compare interest rates, annual fees, balance transfer fees, and other charges to ensure you’re getting the best deal – and make sure any rewards you’ll be in receipt of will be relevant to your lifestyle.

Top Credit Cards in Singapore Right Now

Our favorite credit cards in Singapore are the Citi Cash Back+ MasterCard, Standard Chartered Smart Credit Card, Citi PremierMiles Card, HSBC Revolution Credit Card and UOB Absolute Cashback Card. Let’s see how these top-ranking cards compare alongside each other.

  Best For Reward Type

Citi Cash Back+ MasterCard

Unlimited cash back cap

1.6% cash back on eligible spend all year round

Standard Chartered Smart Credit Card

No annual fees

6% cashback with Netflix, Spotify and selected online food delivery

Citi PremierMiles Card

Air miles

1.2 miles per $1 local spend, up to 4 miles on foreign currency spend and up to 10 miles on selected hotel bookings

HSBC Revolution Credit Card

Reward points with no minimum spend

10 points per $1 spend

UOB Absolute Cashback Card

No-nonsense cashback

15% cashback on online purchases and 6% on digital lifestyle spend

While the UOB Absolute Cashback Card and Citi Cash Back+ MasterCard make the most sense for users who want to build up lots of cash back rewards, the HSBC Revolution Credit Card will be a better fit for those who prefer rewards points over cashback, and the Citi PremierMiles Card is evidently the obvious choice for frequent travellers with higher overseas spending. 

You can get more useful info about our favorite credit cards in Singapore here.

How to Apply for a Credit Card

The process for submitting a credit card application and obtaining card approval in Singapore is a fairly straightforward one. A typical credit card application process involves these steps:

  1. Check your eligibility with the bank.
  2. Submit a credit card application.
  3. Send in supporting documents, such as NRIC and payslips.
  4. Wait for approval.
  5. Activate your card via SMS or phone call.
  6. Start using your card and making timely payments.

Credit Card Fees and Charges

There are several different kinds of credit card fees and charges you ought to be aware of in Singapore, such as:

  • Annual fees – with most cards, annual fee costs can range anywhere from $50 to $500.
  • Foreign transaction fee – depending on the card issuer, this can range from 2 – 4%.
  • Balance transfer fee – this can range from $300 – $500, again depending on your provider, as well as the size of the balance you intend to transfer.
  • Cash advance fees – a flat fee of 6% or $15 usually applies, plus interest of around 30% p.a.

Tips on Using Your Credit Card Responsibly

Once you’ve gotten your hands on a credit card, it’s important to use it responsibly to unleash its full potential and avoid accruing any unnecessary debt. Here are some top tips from Loan Advisor:

1. Create a Budget

Affordability is everything. Creating a sensible budget will help you to ensure you always hit minimum spend requirements but never exceed your affordability.

2. Pay On Time and In Full

Making timely payments is essential to protecting your credit score and avoiding excess interest charges. We’d recommend setting aside some extra cash for your payments each month and setting reminders on your smartphone ahead of your monthly credit card bill date.

3. Monitor Your Credit Card Activity

Keeping a close eye on your spending will help you to avoid unwanted surprises in your next credit card bill. If you see you’ve been overspending on something, you can change your habits before your next monthly bill comes through.

4. Keep Your Credit Utilisation Low

This refers to the percentage of your total credit used in relation to the total amount of credit available to you – try to keep this under control to better manage your credit and all-round finances.

5. Avoid Cash Advances

These can incur charges and ultimately end up costing more than you might expect. As such, it makes sense to try to avoid cash advances where possible.

6. Use Rewards Wisely

We’d suggest redeeming your points or miles for high-value rewards like flights or cashback. This way, your points will be worth more to you than if you cash them in for regular, low-value items or discounts on everyday spending.

7. Don’t Overspend

Overspending could see you hit with an over-limit fee or excessive interest, so be careful here. Again, budgeting and monitoring your spending are the best ways to maintain effective control.

Credit card screen cashless payment in the new normal

Common Credit Card FAQs

1. How Do I Choose the Best Credit Card for Me?

This all boils down to what your personal finance needs are, how much you intend on spending, and what kinds of transactions you’ll be using your credit card for most frequently. Consider all these things carefully before comparing the market – and don’t forget to think about what credit limit you require and how much you can realistically afford to pay as an annual fee, as well as interest charges.

2. Which Credit Card is Best in Singapore?

Again, the answer to this will always be highly subjective. That said, Citi Cash Back+ MasterCard and UOB Absolute Cashback Card appear to be the most competitive and best cashback cards on the market right now. In contrast, the Citi PremierMiles Card is a no-brainer for customers looking to earn bumper air miles, and the Standard Chartered Smart Credit Card is a great choice if you want to save big on annual fees.

3. How Do I Know Which Credit Card to Get First?

You should start by thinking about your eligibility. Most credit card providers will require you to hit a minimum annual income requirement before you can apply. You should also think about what kind of spending you’ll be using your card for most frequently, as some cards charge higher rates on overseas spending or offer perks when you shop online. You need to carefully consider your financial goals and maximum and minimum spending preferences before you apply, too.

4. What Are the 4 Main Credit Card Types?

Credit cards aren’t quite as straightforward as debit cards – they come in many different shapes and sizes. The four main types of credit cards in the city-state are cashback cards, air miles cards, rewards cards, and student cards, though you can find many other iterations of credit cards if you’re prepared to shop around.

Read Also: How to Save Money in Singapore

Conclusion 

From cashback and rewards cards offering substantial online shopping and grocery shopping cash rebates to top-end air miles cards offering unique traveller perks, there are many different kinds of credit cards in Singapore, and it’s important to understand the differences between each before you apply. Don’t forget that:

  • You should determine your unique spending habits and personal finance goals before shopping around for credit cards that properly suit you.
  • You should factor in annual fee costs, interest and other charges when calculating how much a credit card could cost you – as well as your credit limit and all-round affordability.
  • Creating a budget, monitoring your spending, redeeming rewards wisely and making timely payments are the keys to unlocking your card’s full potential in a responsible way.
  • Taking out a credit card can help you to rebuild a good credit history if you’ve previously received a bad rating.

Loan Advisor brings readers all the latest news regarding credit cards, loans, and personal finance. We also specialize in helping Singaporeans to compare loans from licensed moneylenders with just a few clicks. Get free quotes now to compare your options.

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