A student debit card is best for those everyday purchases to avoid going beyond your means and losing track of your spending.
This is because a debit card only draws money from your bank account, so you cannot spend more than you actually have. Although, a student credit card can be good for helping to establish a credit history, the obvious proviso is that you do not abuse any overdraft facility on your student debit card, or you will be hit by bank fees. The other main benefit is that you will not have to carry too much cash around with you, which cuts the risk and consequences of theft or loss.
What is a student debit card?
Providing you with electronic and branch access to your bank account, a student debit card is popular among university and high school students who have not yet established their credit history. An application for a student debit card is convenient and easy as there is no credit history generally required for approval. You only spend the money you have stored in your credit card, and some student debit cards can be used to shop online.
How does a student debit card work?
A student debit card draws funds from your own money in the bank every time you use it. You can swipe it for payment in shops, restaurants, online transactions, link it to your PayPal account, or withdraw money directly from ATM machines.
How do I compare debit cards for students?
When planning to apply for a student debit card, make sure to find the bank that gives you the most benefits. Be mindful that most transaction accounts that are linked to your student debit card usually earn minimum interest.
- MasterCard or Visa. The two main players in the student debit card space in Australia is MasterCard or Visa. Both have a global ATM network, use the latest in chip and data encryption technology and offer purchase protection if you meet the terms and conditions
- No monthly or ongoing fees. Spend time to know what they have in store for a student depositor like you. Find out if there are card maintenance fees. Some banks usually waive monthly service fees for full time students.
- Easy accessibility. Choose one that offers unlimited transactions and ATM withdrawals for free, and one that has an extensive ATM network. Most banks have partnered with other banking institutions that allow ATM withdrawals for free. You may also want to opt for a bank that allows 24/7 online access through their banking portal.
- Mobile and internet banking. As mobile banking nowadays makes day-to-day transactions faster and more convenient, it is wiser to check the bank's mobile app as well and make sure it works on your Android phone, tablet or iOS device.
- Special student offers. Promotional offers like discounts at shops may also be included in some student debit cards so it's great to take a look as to which debit card gives you the best value for advantage in terms of charges, security and incentives. Don't forget to carefully review your cardholder agreement.
- PayPass or PayWave. You can shop faster using PayPass or PayWave technology, which allows you to just tap and go for purchases under $100.
What are the benefits of student debit cards?
- Fast and easy application without the need of a credit history as you're using your own money.
- Gives you protection against overspending as you only spend your money that is in your bank account.
- Most student debit cards have secure chip technology and utilise NFC so you shop faster by tapping and go for your purchases under $100.
- Works similar to a credit card as you have access to most Visa and MasterCard merchants, locations and ATMs.
- Debit cards are generally protected with a PIN and Zero Liability Protection.
- Fees are the one thing that you must try and avoid with student debit cards. These can include service fees charged per month, ATM withdrawal fees, transaction fees and dishonour fees.
Frequently asked questions
- How do I apply for a student debit card? After you've looked at your options and decided the student debit card that is best for your needs, you can apply online or through a branch.
- How long will it take for me to wait for a student debit card application? This depends on the financial institution - generally you can have your card within five working days of lodging the application.
- Will the bank conduct credit checks upon application for a student debit card? Since a student debit card is tied up with your bank account, it is not subject to credit checks.
- Can I still use my student debit card overseas? You can use your student debit card and withdraw money from ATMs when you travel internationally but you may be charged with currency conversion and international ATM withdrawal fees. You may want to opt for an alternative travel money option instead.