Types Of Credit Cards In Malaysia

Credit cards in Malaysia can be categorised into six broad categories. The right card for you depends largely on your spending habits and your attitude to debt.

Cashback

The concept of a cashback card is simple – for every Ringgit you spent, you receive a percentage back in cash at the end of every month or quarter. The cashback (or rebate) percentage varies from card to card and is normally between 0.5% and 3% (although some cards offer up to 20% in rebates).

Should you get one?

They typically have high-interest rates. Most of them have in place a cap (or maximum limits) on rebates. However, if you’re generally a large spender and are always able to pay off your card balance in full, a cashback card could help you earn money back on your spending.

Rewards

Rewards cards let you earn reward points when you spend. These reward points can then be used to redeem a wide range of goods and services. Typically, you earn one reward point for every Ringgit spent on your card.

Should you get one?

Using a rewards card could be a great way of saving money, as most rewards card issuers do not set a cap or maximum limit on the number of reward points you can earn. By using this card on your everyday purchases (and big-ticket items like flight tickets), you can potentially rack up many points without much effort.

Petrol 

Petrol cards are designed specifically for people who spend a lot of time on the road. These cards normally come with great petrol benefits, including rebates or cashback on fuel, as well as discounts at petrol stations.

Should you get one?

If you spend a significant amount of money on petrol each month, having a petrol card could potentially save you a lot of money in the long term.

Travel 

Travel cards are reward-based cards which allow you to earn points or air miles from different frequent flyer programmes when used for purchases. Some also offer discounts on travel packages or flight tickets.

Should you get one?

If you’re a frequent traveller, and already are a member of a frequent flyer or travel loyalty programme (e.g. Enrich, Krisflyer or AirAsia), having one may be a good way to speed up the accumulation of loyalty points.

Premium

Premium cards offer cardholders premium benefits like concierge service, dining and golf privileges, lounge access and more. These cards normally have a much higher minimum income requirement (some may even be invitation-only cards), but they also come with a much larger credit limit.

Should you get one?

Having a premium card will no doubt bring many premium benefits and privileges, like discounts at your favourite five-star restaurant, however, they can also cost a lot of money. Premium cards often charge annual fees in the hundreds of ringgit, although standard annual fee waiver programmes may also be available.

Speciality and co-branded

Speciality cards are the “catch-all” category. These cards are normally designed for a specific segment or target niche. For example, some offer exclusive discounts to movie tickets, while others provide great health and medical benefits.

Should you get one?

Speciality cards are tailored to specific groups of individuals (e.g. frequent movie-goers, lady shoppers or even insurance agents). If you find that you belong to one of these niche groups, having such a card can be very rewarding.

Final note 

There are more than 200 credit cards in Malaysia, and choosing the one that best suits your needs can be very challenging. If you’re in the market for one, you can compare and apply for the best one through our credit card application online site.

Source; https://www.imoney.my/articles/types-of-credit-cards-in-malaysia

Should I Apply for a Credit Card?

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Recent trends have shown that Americans, particularly millennials, are wary of using credit cards. The problem largely stems from the way credit cards are viewed today. They are typically perceived as a "last resort" for consumers who can't afford to pay for their purchases. In reality, credit cards are an essential tool - for the right consumer, they can serve to improve financial standing and even earn them money. You should consider applying for a credit card if:

You Have a Bad Credit Score

Responsibly using one's credit card, and paying off balances, is a fantastic way of rebuilding your credit history. Individuals who have defaulted loans declared bankruptcy, or damaged their FICO score in any other way may be distrustful or wary of taking out any more credit. However, these consumers need to try and think of credit cards as a tool rather than a crutch. Making small credit card purchases and paying them off in full each month can serve to mend a tarnished credit history. While you may not get approved for the best cards available, a secured or entry-level credit card may still be available to you.

You Travel Frequently
Some of the best credit card rewards are those affiliated with airlines and hotel chains. When you pay for your travel purchases using these cards, you will earn rewards which can be, in the future, redeemed for more flights or nights. Each of your travel expenses will be offset by some rewards percentage - effectively working as a 2-4% discount. The only caveat is that this will rarely be a pure cash discount. Instead, you will be rewarded in the form of points or frequent flyer miles. However, if you are a frequent traveler, you will undoubtedly be able to make use of such rewards.

You Plan to Take Out a Mortgage
Even though buying a house or apartment may seem like the distant future, it is never too early to start preparing. The same way in which putting money away in your savings account is planting seeds that will help with your future purchase, using a credit card to slowly build up your credit history helps as well. Your credit score will predominantly affect two things when it comes to a big purchase: loan approval and interest rates. The higher your FICO score, the better your odds of being approved for your mortgage. Furthermore, a good credit score correlates with low-interest rates - this will ultimately decrease the total cost of your investment, as you will pay less interest on your purchase.

You Want to Get the Most Out of Each Purchase
If you use the right rewards credit card to make your purchases, while at the same time diligently paying off your balance in full each month, you are getting the most out of each purchase. Banks are vying for your business, and as a result rewards programs on credit cards are getting better and better due to fierce competition among issuers. If you use the right cashback credit card, for example, you can earn 2% off all your spending. Paying by cash or other means simply doesn't provide anything like it.

Bottom Line
Underlying all these points is a central theme of fiscal responsibility. You should never use a credit card if you will end up paying fees or interest. The ads that come in your mail, the banker, or some website talking about credit cards - none of these things know your personal habits as well as you do. If you know you can use credit cards responsibly, they can act to provide you with fantastic value. Making these little pieces of plastic work for you can strengthen your financial portfolio and put a few extra bucks in your pocket!

TEN REASONS CREDIT CARD APPLICATIONS MAY BE DECLINED

People apply for a credit card for many different reasons. Some are new to the world of credit and just getting started, while others are hoping to expand their access to credit. Regardless of the reason, no one applies for a card hoping their application will be rejected. To improve the likelihood of approval, consumers need to understand the credit decisioning process.

Each lender has different criteria for extending credit. Therefore, consumers should do their research in advance and only apply for the cards that are likely to grant the credit they seek. The NFCC provides the following 10 reasons a credit card application could be declined, along with the steps consumers can take to correct the problem. The list is not inclusive but will help borrowers better understand the review process and how to position themselves to increase the likelihood of credit being extended.

Not enough existing credit – Lenders prefer being able to review a track record of how a person has managed credit in the past.  A thin or nonexistent credit file can give a conservative lender reason to deny.

What to do – Judiciously build credit, perhaps starting with a secured credit card, but confirm in advance that the issuer reports activity to the credit bureaus.  Also consider becoming an authorized user on another person’s card, as the activity of the primary cardholder, as well as the authorized user, is reported to the bureaus.

Poor pay history – The highest weighted element in the scoring model is how a person repays his or her debt obligations.  A history of skipped or late payments can be a knock-out punch when attempting to obtain new credit.

What to do – Identify any issues by obtaining the credit report for free at www.AnnualCreditReport.com.  Next, start making payments on all accounts including those that are past due. This begins building a positive history and helps to establish creditworthiness.

Existing credit lines maxed out – Creditors don’t like to see that a person is utilizing all of their available credit, as this can signal that they are living on credit, and opening a new line will only increase current indebtedness.

What to do – Pay down credit card debt to equal no more than 30 percent of available credit.  Credit utilization is the second-highest weighted element of the scoring model, so lowering debt could also benefit the credit score.

Overall debt is too high – A person’s debt-to-income ratio is a reflection of how much is owed relative to their income.  People have expenses beyond credit cards, thus lenders take all existing obligations into consideration.

What to do – Increase income or decrease debt.  The important thing is to not appear that more is owed than can be responsibly managed.

Too many inquiries – It’s a red flag if a person is attempting to obtain too much credit at one time.  Too many inquiries or recently opened accounts can make a lender reluctant to give the person another chance to spend.

What to do - Only apply for the number of cards that are necessary and are appropriate for your financial situation.  If declined, do not continue applying.  Instead, take steps to remedy the reason for the rejection.  Wait a few months to reapply, as that will give the credit report time to update.

Serious negative notations – Unpaid tax liens and Chapter 7 bankruptcy can remain on a credit file for up to 10 years. Foreclosure, late and missed payments, collection accounts, and Chapter 13 bankruptcy can remain for seven years.

What to do – The further a person moves away from the date of the negative activity, the less impact it has on credit decisions.  A person doesn’t need to wait until the activity rotates off the credit report, but putting distance between the harmful information and applying for new credit is helpful.

Insufficient income – Although often not made public, issuers have minimum income limits that must be met in order to grant credit.

What to do – Research which cards are more likely to grant credit to people with low incomes.  In the absence of other eliminating factors, getting a part-time job to supplement the primary source of income should enhance the likelihood of credit being extended.

Unstable job history – Recent unemployment or consistent job-hopping indicates an unstable income, thus putting a person at risk of default in the lender’s eyes.

What to do – Make steady employment a priority.  Changing jobs within the same field may not weigh as heavily against a person, particularly if it is a promotion.

Too young to apply – Applicants must be a minimum of 18-years-old to apply for a credit card.

What to do – As a result of the Credit Card Accountability, Responsibility, and Disclosure Act, Americans must be 21-years-of-age to independently receive credit unless they can prove the ability to pay or have a co-signer.  It is not a bad idea for a young person to learn to manage money by living on a cash basis or using a debit card before applying for credit. 

Errors on the application – Credit card applications can be long, making it easy to inadvertently skip completing all areas.

What to do – Avoid unintentional errors by filling out the application online, as these forms often do not allow a person to submit until all required fields are completed.

When applying for credit, ask yourself if you would loan money to you.  If the answer is ‘no,’ then it’s likely the financial institution won’t either. That’s the signal that it’s time to take action and improve your credit profile. Credit card companies want to extend credit, but only to people who represent a low risk for default as defined by their business model.

If denied credit due to information contained in the credit report, the Fair Credit Reporting Act requires lenders to send the applicant an adverse action notification which includes the reason for the denial. To be in a better position for approval next time, review the reasons for the rejection and take the necessary corrective steps.

The Best Credit Card Deal at Ringgit Plus

There is an exclusive offer at   RinggitPlus When you apply online at their site for an HSBC credit card you will get a free tablet (Huawei Mediapad 7 Youth 2) upon approval of your application. This is in addition to all the goodies offered by HSBC as mentioned in my article, The Best Credit Card to Apply for Now.  The offer from HSBC includes an HTC smartphone and up to RM1199 cashback. The special offer from RinggtiPlus is valid from October 5, 2014, to January 8, 2015. You can read their terms and conditions here 

 RinggitPlus is Malaysia's leading comparison website. They offer comprehensive free services in the following areas:

Credit cards 

Personal loans and home loans

Savings, current accounts, fixed deposits

Home broadband plans

Dining, gadgets, fashion, household items discounts

Insurance: Travel Insurance, Critical illnesses, medical cards   

There is also a blog offers educational articles about financial matters

For all things relating to money it pays to visit this site first to get the best deal.  

The Best Credit Card to Apply For Now

I have already got three credit cards and I have also bought the cheapest smartphone in Malaysia recently; otherwise I will definitely apply for an HSBC credit card today.

According to their online promotion here, you will receive the following goodies upon approval of your application:

·         Swipe your HSBC credit card one time within 30 days from the date of the welcome letter, you get RM50 cashback.

·         When you are among the first 2500 new cardholders to spend RM1500 within the same 30 days period, you will get an HTC smartphone (model HTC Desire 210) worth RM499.

·         When you apply online you get additional RM50 cashback.

·         Waive the annual fees when you swipe your HSBC credit card for a minimum of 12 swipes in a year.

A useful tip to qualify for the Smartphone:

You can spend RM1500 wisely to qualify for the reward by buying a big-ticket item with a zero interest installment plan. Get a laptop or tablet or sign up for an online course and invest in yourself.

When you looking for a smartphone and a new credit card, look no further apply for an HSBC credit card now. The offer ends December 7, 2014. 

5 Things to Know About Credit Cards

Credit Cards

The right credit card can help you manage your finances.

When you're choosing a new card, it's a good time to be picky.

Shopping for a new credit card can be pretty overwhelming, especially considering you have hundreds of types of cards to choose from. Should you go for a rewards card, the lowest interest rate card you can find, or the card that comes with a free T-shirt? If you're trying to sort through all your options, consider these five tips that I recently shared on "The Tavis Smiley Show" from Public Radio International.

1. Use comparison websites. The myriad of credit card options today is matched by a slew of comparison websites that make it easier than ever to customize your search for the right card for you. Google's credit card search tool lets users narrow down their search by interest rate, rewards, and a dozen other factors. IndexCreditCards.com, Bankrate.com, CreditCards.com, CreditKarma.com, and NerdWallet.com all offer credit card search tools.

If you always pay your bill in full each month and never carry any debt, then you can take a closer look at the rewards options. Perhaps you prefer cash back to airline miles or points that let you make purchases at retailers such as Best Buy (BBY) or Home Depot (HD). If you do carry any debt, though, then you'll want to focus on minimizing the APR, or annual percentage rate. Just don't sign up for the first offer you get in the mail because it might not be the best one for your situation.

2. Check up on the extra protections that come with your card. Credit cards come with various forms of protection, including theft, non-delivery of items from a company, and even extended warranties. If you travel a lot, then you might want to focus on cards that come with travel perks like insurance; if you buy a lot of large electronics, then the extended warranty protection might be for you. If you're a big shopper, the price protection, which offers to make up the difference if an item you buy drops in price, could be your best bet. The important thing is to read the fine print, ask questions so you know what perks come with your card, and pick the card that has the benefits that are important to you.

3. Don't be tempted by freebies. Credit cards sometimes offer tempting short-term benefits, including token gifts like T-shirts or a temporary zero percent APR. For the most part, you don't want to get sidetracked by these offers because they mask the far more important factors, namely the interest rate and any relevant fees. In fact, you should probably ignore introductory gifts altogether because you'll have your card for longer than you'll enjoy the added freebies. You can buy your own T-shirt later.

4. Avoid rewards cards unless you carry zero debt. On average, rewards cards carry higher interest rates than non-rewards cards. According to IndexCreditCards.com, the average interest rate on a consumer rewards card is currently 17.64 percent, and the average rate on a non-rewards card is 15.48 percent -- that's a full two percentage point difference. It might not sound like much, but if you're carrying debt each month, then you want to make sure you're paying as little as possible for it. (Along with developing a plan to pay it off in full as soon as possible.) Any rewards are not worth the extra interest payments.

5. Rates and fees can be negotiable, so always ask. Credit card providers are sometimes more flexible than you might think. If you're a good customer with a strong credit history, then you might have some leeway to ask for a lower interest rate or for an unexpected fee to be removed. You can sometimes negotiate better terms for yourself, especially if you're a good customer who pays on time. There's no harm in calling up the customer service representative to ask what they can do for you.

The bottom line: You want to make sure your credit card is working for you, and not vice versa. Pay off your bill each month so you're not carrying any debt, and take advantage of the free rewards coming your way. If you do have debt, make a plan to pay it off, because the high-interest rates on credit cards add up quickly over time.

Things to Consider before Getting a Credit Card

Do not think that when you have a credit card your lifestyle will change for the better or you can spend freely. In fact, when you don’t manage your credit card with care you will end up as a bankrupt 

Consider the following before acquiring a credit card:


1. For convenience and not for credit: Don’t think that you can increase your spending power by just paying the minimum amount and roll the balance to the following month and continue to spend in this way. A credit card is for convenience and not to obtain credit or to incur debt. The outstanding amount has to be settled fully and promptly when you receive the monthly statements

2. Take advantage of credit card benefits: You can take advantage of your credit card to reduce your normal expenses such as petrol and other grocery items. For certain cards, you are given rebates for the purchase of these items.

3. Simplify your life: You can arrange with the card issuer to pay for all your utility bills and insurance premium. Life is easier when you don’t have to issue too many cheques and go to too many places to settle your monthly bills and commitments

4. Self-discipline: Are you able to control your spending according to your budget?
Are you not an impulsive spender? You can keep a credit card if you follow closely your monthly spending pattern with or without a card.

5. Track your spending: You can use your credit card as a tracking tool to monitor your spending. Review the monthly statements to trim unnecessary expenses.


When used correctly, a credit card is an asset and not a liability.