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Compare Credit Cards in Ireland
What to look for when comparing credit cards.
Finder’s free service makes learning about credit cards simple. Someone new to the world of credit cards may find the varieties offered in the market mind-boggling. Here’s a comprehensive guide from Finder to help you navigate your choices and understand the features and fees that come with this convenient source of credit.
How do credit cards work?
A credit card is a form of unsecured credit issued by banks that allow customers to make purchases without having to use cash. You can also use them to withdraw money from ATM machines but this comes at a fee.
All credit cards come with a credit limit which is calculated based on the bank’s assessment of your perceived ability to make repayments. This is usually tied to your annual income.
Credit cards are different from debit cards, which are tied to actual money in a savings account. When you use a credit card, you are essentially borrowing money from the lender to pay the retailer first, before you repay the bank at the end of your billing cycle. You will receive a statement at the end of each billing cycle that tells you the total amount you owe the bank. By making the repayments promptly, you avoid paying any interest fees.
There are many types of credit cards available that enable users to earn various types of rewards, air miles and discounts. This gives great incentive to sign-up for a card and earn rewards/save money simply by charging their purchases to the card.
What type of credit cards are available?
- Rewards. Earn reward points as you spend and maximise the perks you can redeem with a rewards credit card.
- Travel. Earn points on everyday purchases to redeem for your next holiday with your favourite airline.
- Secured. Manage your expenses and by comparing a range of secured credit cards.
- Low interest. Earn long-lasting interest rates on purchases with low interest credit cards.
- Balance Transfer. Pay off your debt faster with lower interest with balance transfer credit cards.
- Business. Enjoy flexible business financing and earn rewards on your business purchases by using business credit cards.
- Cash Back. Earn cash rewards on your credit card purchases with cash back credit cards.
- €0 annual fee. Earn wide range of benefits with €0 annual fee credit cards.
What other features should I look out for?
For those who are new to credit cards, there are some key features worth mentioning so that you can optimise the use of your credit card and learn about the related fees and charges involved.
- Credit limit. The credit limit is the amount you can spend on your credit card. For student credit cards, the credit limit is usually set between €500-€1,000 for those who are not drawing an income. Regular credit cards usually require an annual income of at least €15,000 and the maximum unsecured credit limit may be set at four times the amount of your monthly salary. This does not mean that you will get the maximum credit limit for your credit card, as the rule applies to all the combination of all credit cards and unsecured facilities you with the bank.
- Grace Period. The grace period is an interest-free period where you can use your credit cards without incurring any finance charges. This is typically 56 days in Ireland.
- Rewards. One perk of using a credit card is that it allows you to earn various types of rewards when you use them for payments. Reward types include cash rebates, discounts on partner merchants, earning air miles which can then be used for redemption of free flights or upgrades, as well as reward points which you can exchange for vouchers.
- Security. There are a number of security features that come with credit cards that help to make your transactions safe and prevent fraud. All banks require customers to activate their new credit cards before using it in order to prevent anyone else using it instead. Features include transaction alerts when your pre-defined limit has been made and One-Time passwords on merchant websites.
What are the costs of a credit card?
- Repayments. You’re free to repay as much as you like as often as you like. You’re required to make the minimum repayment when your statement is issued. The minimum repayment is usually around 3% of your outstanding balance, but you should always aim to pay this balance in full. You will pay a late payment fee if you don’t make the minimum repayment by the statement due date.
- Annual fee. This is the cost to own a credit card. The annual fee ranges from €0 to €150 or more depending on the credit card type. The credit card annual fee is deducted from your available credit and accrues interest at the purchase rate if it isn’t paid in the first statement period.
- Interest rates. There are no interest charges added onto your purchases if you pay off the card balance within the grace period. Beyond that, credit cards here typically charge an interest of 20-25% per annum on your card balances. As the interest is compounded and charged on a daily basis, they can easily accumulate if you keep rolling over your balances month-on-month.
- Other fees. Other fees you may run into include late payment fees, over credit limit fees (a fee for spending past your credit limit), rewards program membership fees and cash advance fees.
Credit card application tips
While applying for a credit card doesn’t have to be complicated, it can come with certain risks. Consider the following tips before applying:
- Assess your needs. Before you begin your search, spend some time considering what you want, need and can afford with your next credit card.
- Compare your options. Once you’ve decided what type of card you want, it’s time to begin comparing your options.
- Are you eligible? Know the requirements for the card application – do you need a minimum income and do you meet the age limit?
- Know your credit score. You should request a copy of your credit history before applying, so you can correct any possible errors on it and see exactly what the bank will be seeing when they assess your application.
- Lower your credit utilisation ratio. If you already have a credit card balance, it’s wise to pay off your existing balances before submitting a new credit card application.
- Don’t apply for multiple cards at once or within a short period. You may be tempted to apply for a second card just in case your first one doesn’t get approved, but don’t. Each credit enquiry that a lender makes about your credit history leaves a new mark on your credit file for five years.
Who can get a credit card?
There are credit cards suited to almost everybody, but make sure you confirm that you meet the eligibility criteria before you submit your application, as rejected credit card applications can have a negative impact on your credit score.
Credit cards are offered at the issuer’s discretion – in other words, when you apply for one, the card issuer will weigh up your application, and if it thinks you’re a safe bet, it’ll offer you a card. That said, meeting the specific eligibility requirements doesn’t guarantee your approval for a credit card.
Eligibility requirements usually include:
- Age. Cardholders generally must be at least 18 years of age.
- Residential status. Most credit cards are open to application for adults and foreigners alike, subject to varying income requirements and additional documents.
- Minimum income. The minimum income requirement will vary between cards, but they usually start at €15,000 a year for most basic credit cards and significantly more for higher-tier products.
- Credit history. All credit card issuers require applicants to have a good credit history.
With several credit cards to choose from in Ireland, it can be daunting to know what to look for. But understanding your needs and matching them with the features of a credit card can mean you get the most out of this line of credit whilst avoiding the higher interest fees so often associated with them. Do a little research to compare your options before taking the plunge and applying for a credit card.
Frequently asked questions
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