Like many other countries, the Philippines embraces credit cards. Among other things, Filipino credit cards include travel benefits, rewards, and credit building tools.

Especially for those who are new to the idea, negotiating the credit card terrain in the Philippines might be difficult. From how to get a credit card, how to use credit card sensibly and maximize its advantages in this all-encompassing guide, we will address everything in this post. 

How to Apply for a Credit Card Philippines

A credit card can open a whole new world of financial opportunities

Some of the following key steps easily makes the application process for a credit card in the Philippines smooth:

  1. Know Your Creditworthiness (Credit Score)

Know your credit standing first. Banks and other financial institutions evaluate potential cardholders based on their debt-to-income ratio, annual income, employment status, and credit history. Chances of qualifying. Good credit history, especially regular payments on prior credit card balances or other loans, increases your chances of getting approved for a credit card.

Having a regular income and low debt-to-income ratio boosts your application. 

  1. Research and Choose a Credit Card

There is a wide range of credit cards for different lifestyles and expenditure patterns. Compare credit card features and benefits like annual fees, interest rates, reward from your online purchases, access to airport lounges or trip insurance to find a card that fits your financial needs and spending pattern. Should your trip frequency be somewhat high, the ideal travel points or air miles card would fit.

The best cash back card need not be excluded either, particularly if cash back stays a major additional incentive for regular purchases or online shopping. Some credit cards from other banks even give you the option to waive the annual fee for life in exchange for a minimum required purchases so make sure to weigh in all your options.

  1. Gather All Documents Required

Once you settle on some of the credit cards from your list of preferences, gather the required paperwork that the issuing bank or other financial organization accepts. This usually encompasses the following:

  • Proof of Identity: Typically government-issued IDs like a passport, driver’s license, or Unified Multi-Purpose ID (UMID), preferably one with photo and signature.
  • Proof of income such as income tax returns, or pay stubs
  • Proof of Address: Utility bills, lease contracts, or barangay clearance.
  • Three (3) months latest bank statement
  • PayPal or other remittance statements (if you receive freelance payments this way)
  • Copies of client contracts or invoices
  • Certificate of Registration (BIR): If you’re registered as self-employed.
  1. Submit Your Credit Card Application`

Alternatively, you can choose between an online application or at a branch of an issuing bank. Make sure to fill out the application form fully and accurately enter all details about you. Ensure you go through your application in order to correct any mistakes or discrepancies that will make you take more than you expect while applying.

  1. Wait for Issuance and Approval of a Card

The bank or financial institution will analyze your credit worthiness when you apply. The review procedure is about a few days to a week. After acceptance, you will be communicated with within two to three weeks of receiving it and its credit card mailed to your address.

How to use credit card responsibly

Being disciplined around credit card use can elevate your financial life

The correct use of credit cards is first if one wants to fully enjoy the advantages of a credit card and avoid any financial troubles. Following certain simple rules helps:

  1. Steer Clear of Overspending. With prudent credit card use, limited to what you can afford and avoid going past your credit limit. To prevent overspending, be cautious with credit card purchases and ensure you can pay the principal debt every month. Take advantage of your credit card rewards points and redeem them so you can have more cash credits to use prevent overspending.
  2. Pay your bill on time. Pay your credit card balance in time since high interest rates on late payment will increase your debt and place your credit score at risk of getting damaged. Nowadays there's a lot of payment options from other private entities to choose from so you won't have the problem of going to the nearest branch just to pay for your bills. You can pay your credit card bill in the comfort of your own home before your due date. If you have a supplementary credit card, make sure to check on those as well.
  3. Cash advances caution. Cash advances on your credit card can be expensive because they usually have very high interest rates. Avoid taking cash advances at all costs and opt for other sources of money rather than your credit card.
  4. Be aware of annual fees. Annual membership fee is sometimes charged for some credit cards. If one does not use the card too much or the benefits and rewards cannot justify the cost, it would be a good decision to consider a credit card that has no annual fees as some give you the option to waive the annual fee for life or on the first year.
  5. View credit card statements and APRs. See your credit card statements for any potential mistakes on finance charges or fraudulent activity. Should you find any disparities, you should notify the issuing bank right once to help to prevent fraud victimizing you. Make sure to always check your electronic statement when they arrive.

Tips to Increase Approval Chances

Maintain a stable account balance: Demonstrate financial stability through consistent deposits in your bank account.

  • Keep invoices and contracts organized: These can serve as proof of recurring income.
  • Build a relationship with your bank: Use their services regularly, like maintaining a deposit account or paying your bills using their bills payment options.
  • Improve your creditworthiness: Avoid loan or bill payment delinquencies. Make sure you have a stable source of income.

Conclusion

The hunt for your first credit card begins -- let's do it right!

In conclusion, navigating the Philippine credit card market may initially appear overwhelming, but with the correct strategy, it can be a pleasant and manageable experience. You can improve your chances of approval by being aware of your creditworthiness, choosing the best card for your requirements, providing appropriate documentation, and applying strategically.

Using your card responsibly is essential to maximizing its advantages and avoiding financial traps once you get it. Spend no more than you can afford, pay your bills on schedule, and keep an eye out for fees and other inaccuracies on your statements. You can fully utilize credit cards as useful financial instruments by adhering to these rules and establishing a good credit history. Click this link so you can see Finmerkado's list of various credit cards you can choose from.