Free up your cash flow between paydays and start building credit history with a student credit card.
Student credit cards are designed to help you manage expenses while you're studying full-time. They can also be a stepping stone to other forms of credit, such as car loans and home loans. But before you can start using a credit card, you'll need to get your application approved. Use this guide to learn more about student credit cards, including what to think about before you apply and how to prepare for the application. You'll also find answers to frequently asked questions so that you can decide if a student credit card is right for you.
Student credit cards comparison
What is the point of student credit cards?
Student credit cards let you buy what you need, when you need it, with the option of paying it off over time. These cards charge interest when you carry a balance from month to month but can be useful if you have a lot of expenses at one time – for example, if you have to buy a new laptop and textbooks at the start of the semester.
Some student credit cards also offer you interest-free days if you pay off your balance in full by the due date on your statement. This could be handy if you use it between paydays or if you're waiting for a scholarship payment to come through.
What do I need to know before I apply for a student credit card?
If you're interested in getting a credit card while you're studying, the first step is to find one that will fit your lifestyle and spending habits. So it's important to compare a range of cards based on their features and costs. Not sure where to start? Here's a rundown of the key features to compare:
- Annual fees. It's common for credit cards in Australia to charge an annual account fee. However, many student credit cards actually waive this charge if you're a student and meet the eligibility requirements (such as showing your student ID from a valid tertiary institution).
- Interest rates. Credit cards usually have two main interest rates. The purchase rate applies to most everyday spending, while the cash advance rate is charged if you use your card to get cash out or for any other cash advance transaction. Generally, a credit card with a lower purchase rate will help keep costs down if you need to pay off your spending over time.
- Interest-free days. Most credit cards offer an interest-free period for purchases if you pay your full balance off for each statement you get. For example, a card could offer "up to 44 days interest-free on purchases". This gives you a way to avoid paying interest when you have a student credit card – as long as you've paid everything off by the due date on each statement.
- Extra features. While student credit cards are usually light on extras, some may offer complimentary insurance, such as purchase protection insurance that can help protect your new purchases against theft, loss or damage.
As well as looking at different card features and costs, you'll need to make sure you're eligible to apply for the credit card you choose. The requirements vary between cards but here's what you'll usually need to consider:
- Am I old enough? You have to be at least 18 years old to apply for a credit card in Australia. If you're not yet 18, consider asking a parent to be an additional cardholder on one of their accounts.
- Is there a minimum income requirement? Some credit cards list how much you need to earn before you can apply. Usually with student credit cards, this requirement is quite low and includes any Centrelink payments you may get.
- What is my credit history like? If you're a student, you may not have a lot listed on your credit history (if anything). But credit card companies will still do a credit check, so you may want to request a free copy of your credit file before you apply to see what's on there and how it could affect your application.
- Are there other eligibility requirements? For example, most student credit cards require you to be studying full-time at university or an approved educational institution. Others might only be available to Australian citizens or permanent residents (rather that students on temporary visas). So make sure you check the requirements for any card you're considering before you apply.
What information do I need to apply for a student credit card?
If you meet the eligibility requirements, you can usually apply online in around 15 minutes. The application will ask for a whole range of your personal and financial details, so it's good to have this information handy before you get started:
- Personal details. This includes your full name, date of birth, email address, phone number, residential address and relationship status.
- Identification. Most credit card applications ask for a driver's licence to help prove your identity and check your credit history. This includes a learner's permit but if you don't have a licence, you should be able to complete the application using your passport or Medicare number.
- Student details. This includes information about your university, course, the length of the course and your current year. You may also be asked to provide a copy of your student card or enrolment information.
- Financial details. This section is usually one of the biggest parts of a credit card application. You'll need to share details of your income and contact information for your employer. If you're receiving government payments from Centrelink or if you have a scholarship, include these details as well. You'll also be asked about any other assets you may have, such as savings accounts or a car, and about debts, such as existing cards or loans.
- Regular expenses. As well as your income, assets and existing debts, the application will ask you to estimate your spending on essentials such as rent, bills and groceries. Try to be as accurate as possible in this section so that the bank gets a clear picture of your budget.
- Credit limit. You'll be asked whether you want the bank to assign a credit limit for you, or if you would prefer to request a specific credit limit. It's up to you whether you request a limit or not but keep in mind that a smaller credit limit can help you budget for repayments and avoid serious debt.
As well as filling in the credit card application form, you may need to submit a range of supporting documents. These could include:
- Recent payslips or bank statements
- A copy of your driver's licence, Medicare card or passport
- A copy of your student card or enrolment information
- Details of your rental agreement
Some credit card providers let you upload these documents when you apply. Others may ask for them after you've submitted your application and, in some cases, you may need to take them with you to a nearby branch. You can usually check what's required before you apply by calling the bank.
I've applied for a student credit card. What happens now?
This depends on the bank or credit card provider. If you've applied online, you'll likely get a response within 60 seconds of submitting the completed form. But in some cases, you may get a call from the bank asking for more details so they can assess your application, so make sure you have all the relevant details handy while you wait.
In some cases, the application could take several days to be assessed before you get an outcome, so try to be patient. If you're approved, you can usually get your card within 10 working days. Then it's just a matter of following the steps to activate it so you can start using it.
Applying for a student credit card is pretty straightforward when you know what you'll be asked and how these accounts work. Just remember to compare a range of credit cards and look at your own circumstances before you apply so you can get a card that works for you.
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Frequently asked questions
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