We know that earning money and managing your expenses on your own is tough, but we are here to help you out. As a student having a credit card becomes essential. This will enable the students to gain convenience while learning good credit habits. Students will learn more about managing their expenses and preparing their monthly budgets accordingly. Credit cards will ease student's life and provide them with many other benefits. Before getting a credit card, some aspects should be crystal clear.
What is a student credit card?
A student credit card is a credit exclusively for students, typically those with low income. In student credit cards, the spending limits are lower. There are a lot of rewards, introductory periods for purchases and cashback for the students. Student credit cards are the initial step in building a credit history, which will benefit the students in the long term. It can be widely used for everyday expenditure, with the balance paid off in full every month. If used mindfully, it can be a valuable tool for students.
- Easy real-time money, which can be paid off later.
- Students will have no hassle of borrowing money for everyday expenditures.
- Students get into spending money wisely and managing expenses more efficiently.
Eligibility criteria for a student credit cards
For getting your personal credit card, several aspects are considered by the banks. Every bank will have its own set of criteria. There are some standard criteria listed below.
- The student applying for the credit card should be over 18 years of age.
- For students in the UK applying for a credit card, the student should reside in the UK and have a UK bank account. Sometimes, it will also be mandatory to have the same bank.
- You should be a student enrolled in a minimum two-year course at the UK University or College.
Benefits of student credit card
There are many reasons why you should get a student credit card while studying in college or university. The first and most important concern about using a student credit card is that buying your everyday essentials becomes very convenient. As a student, you will have no credit history or who has never used a credit card. Having a good credit score will benefit you in future. As a student, you might be doing a part-time job and meeting everyday expenses will be a task for you. So credit card helps and gives you time to repay the goods and services later.
- Students can build a credit score which will benefit them in the future.
- The credit card allows students to manage finances with flexibility
- Spend the money up to a pre-arranged limit.
- Students get purchase protection ranging from £100 to £30,000.
Best student credit cards in the UK
1. Tesco Foundation Credit Card
The list of student credit cards in the UK is vast, so we have filtered them and listed the best ones for you. The Credit Card offered by Tesco Foundation is for the ones who want to build a credit card score. It is not just limited to students, anyone can use it. Following are the features of credit cards.
- Tesco credit cards are for new users or people with no previous credit score.
- The credit limit of the Tesco Foundation Credit Card is between £250 - £1,500.
- The student can make monthly repayment starting from £25.
- You get access to ‘CreditView’, which will be beneficial for you to track your credit score, which will be valid for 3 years.
- You will also get Clubcard points which is a credit card reward.
2. TSB student Credit Card
Like many other student credit cards in the UK, the TSB student credit card is for TSB Student Current Account holders. The minimum tenure is 3 months for the account holders to get a Student Credit Card. Following are the features of the TSB student credit cards.
- It is only applicable to TSB Student bank holders.
- The credit limit for the student credit card will be pre-decided.
- The students must make a minimum payment of a certain amount each month.
- The interest is charged from the very start of the transaction at 21.95% p.a.
- It works with both Google Pay and Apple Pay.
- 21.9% representative APR
3. HSBC Student Credit Card
HSBC is another student credit card provider where the students must be HSBC Student Bank Account holders. Applying for student credit cards in the UK is very simple if you have already registered for online banking. There will be a pre-filled application form that you will need to submit, and it's done.
- The credit limit HSBC offers is up to £500 for students.
- There is no annual fee.
- You get the benefit of 24/ 7 assistance, and that too worldwide.
- You can use the credit card abroad as it is functional in every country and region.
- You get purchase protection starting from £100 to £30,000.
Words of Wisdom for student credit card
Gain control over your money just now or never
Check the price of the product before you purchase, and spend wisely. Spend only what you can afford. To keep it simple, you can think this way whenever you are buying something, think if you can purchase the same with cash; if the answer is yes, you can go ahead, but if the answer is no, you should not buy that also, if you make sure to pay it in the same period.
- Using a credit card for emergencies is fine, but using a credit card for impulsive shopping is not right.
- Budgeting should be inclusive of fun and luxuries. To learn more about budgeting as a student, click here.
- Practise good saving behaviour and prepare a budget.
A stitch in time saves nine.
Paying on time is the key. It will save you from interest and help you build a good credit history. Pay in full, on time. As you know, exceeding 30% of the monthly credit will negatively impact your credit score.
- Paying on time will help you to reflect on your credit score with a positive remark.
- It will save you from any extra fees.
The Sky is not the limit.
Every credit card has a specific pre-defined credit limit, which you should never cross. So, guys sky is not the limit regarding student credit cards. Spend mindfully and pay attention to the upper limit which is given to you
- Spending over your credit limit will lead to a lowering of your credit limit.
- You will have to pay penalty fees.
- In extreme cases, you will be asked to repay the total amount you owe and close your account.
Frequently asked questions
Q1. Can I apply for student credit cards without a job?
Answer: Yes, as the income criteria for student credit cards are usually lower, considering that you are a student enrolled in a university course. Considering that you are a student, we’ve got some quick and simple recipes.
Q2. Is cash withdrawal possible with my student credit card?
Answer: Yes, cash withdrawal with your student credit card is possible. You will need to pay a higher amount of interest rate. You will have to check the terms and conditions of the credit card you apply for.
Q3. Will loans affect my student credit score?
Answer: No, loans will not affect your credit score as a student loan. Student loans differ from other borrowings and do not reflect on your credit file.
We hope you find this guide helpful and that you also have insight into the best credit cards in the UK. Here are a few things to remember while using a student credit card. Getting a credit card comes with a responsibility. As a student, instead of doing impulsive shopping, try to save some pennies and keep the credit card for emergencies and necessities. Be mindful and build a good credit score because, in the end, it does get counted. Make sure you clear all your repayments and spend wisely.