Applying to credit cards companies but always get rejected or disapproved? Don’t worry, though it seems impossible to be carded now with all the rejections you have received, there is actually a solution so you can get your first credit card in an easier way. How? By way of a secured credit card (SCC). It’s easy to apply and fast approval.
SCC Now, Regular Credit Cards Later
Normally, after six months of having a secured credit card and using it judiciously, you may now try to apply for regular credit cards via online, by visiting a bank, or via credit card agents like in malls. This time the chances of you getting approval are higher because you are now carded, you have established credit history and credit score with your secured credit card.
What is a secured credit card?
This is a type of credit card with a hold-out amount. Parang kumuha ng “collateral” sayo ang banko so you can get a secured credit card.
To get an SCC, you can go to your target bank like AUB, BPI, BDO, RCBC, SECURITY BANK, UNIONBANK, METROBANK, etc, bring requirements and open a savings account, sign an affidavit of undertaking for an scc, fill-up the credit card application form.
For SCC, Security Bank has their Fast Track Program, BPI is offering Express Start Program, other bank’s also have theirs.
How does it work?
SCC works this way – a percentage of the money you deposited will be ‘on hold’, you cannot withdraw it. On the bank’s part, they will issue you a secured credit card. Just in case you will not be able to pay your credit card charges, the bank will take money from your hold-out deposit to pay any outstanding due.
You can get the hold-out amount in full the moment you will cancel your scc.
How much will be your CL or credit limit for your secured credit card? It depends on the bank. Usually, the credit limit is around 80% of the hold-out amount.
Example: You deposited 25,000, 80% of this is your credit limit or P20,000. The bank will ‘freeze’ P25,000 from your savings account, you can’t withdraw or touch this amount, unless you close or cancel your secured credit card. Eto collateral mo sa banko.
Banks and their Secured Credit Cards
iSensey shares the latest info we have gathered regarding credit limit percentage given to secured credit cards.
|Credit Card Issuer||Minimum Hold-out Deposit||Credit Limit||CL % of Hold-out Amount|
|Asia United Bank||P25,000||P20,000||80%|
|Bank of the Philippine Islands||P15,000||P5,000||90%|
|Banco de Oro||P10,000||P9,000||90%|
The figures above are the latest we found from the respective bank’s website. ISensey recommends that you call the customer service hotline or visit a branch, for the latest information.
If you want a higher credit limit, you deposit a bigger amount. The bigger the deposit, the bigger the CL.
Advantages of a Secured Credit Card
It is easy and fast to get, almost 100% guaranteed that when you apply for a secured credit card, you will be approved.
You can build your credit history and credit score with an SCC. In the future, you can apply and be approved for a regular card, personal loans, housing loans, etc.
If you don’t have cash with you, you can use your card in shopping, dining, etc.
You have a credit card which you can use to purchase on installment, you also have the opportunity to earn eGifts and rewards if the type of card issued to you has a promo campaign.
There are more advantages, so we strongly recommend that you go and apply for a secured credit card.