Read on to learn all about student credit cards.
Best Student Credit Cards
Preparing for University in September? If so, it's time to start thinking about your finances. University is a great experience for gaining a quality education, propelling your social life, and learning to navigate life.
Don't miss out on great university experiences because you're low on cash. Consider opening a student credit card account.
Yes, as well as having your everyday student bank account, you can apply for a student credit card in case you need help between your student loan installments or just looking to build credit.
If you've never had a credit card, this may be an entirely new adventure but don't worry. In this article, you'll learn all about student credit cards, and we've found the six best student credit cards to help narrow your search.
|1. HSBC Student Credit Card||★★★★★||Click Here|
|2. TSB Student Credit Card||★★★★★||Click Here|
|3. Aqua Advance Student Travel Credit Card||★★★★★||Click Here|
|4. Vanquis Bank Classic Credit Card||★★★★★||Click Here|
|5. Capital One Classic Credit Card||★★★★★||Click Here|
|6. Barclaycard Forward Card||★★★★★||Click Here|
How Credit Cards Work
A credit card is a financial tool that allows you to borrow money from a credit card provider to make purchases. There are many benefits to having a credit card, from building credit to having an emergency backup for unexpected expenses. A credit card has many uses depending on its type.
As a student, you may only need one type of credit card, but it’s always a good idea to see what other cards are available.
There’s no harm in becoming more knowledgeable about credit cards.
The different types of credit cards:
- Purchase cards: ideal for spreading the cost of purchases. Some credit card companies offer an interest-free introductory period.
- Travel credit cards are designed to ensure you're spending safely abroad. Additionally, travel cards reduce the cost of using a card abroad.
- Credit builder cards: if you want to build your credit record, you can apply for a card that helps you create a good credit rating.
- Rewards cards: there are cards that you can use to take advantage of rewards like cashback, shopping discounts, and travel miles.
- Balance transfer cards: this card is ideal for people looking to clear existing credit card debt; it allows you to transfer the balance to a higher APR credit card to pay back the debt during an introductory interest-free period.
- Money transfer cards: similar to a balance transfer card as it helps reduce debt. You use this card to transfer money to a direct debit card to pay back overdrafts.
When you apply for a credit card, you'll sign an agreement stating all the details of your credit agreement, so you must read all the fine print and terms and conditions. This process is universal across all credit card types. It's important to know that some cards offer lower credit limits than others, and eligibility changes depending on credit card type.
So, now that you know the general types of credit cards, let's dive into student credit cards and everything you need to know about them.
What is a Student Credit Card?
A student credit card has the same concept as a regular credit card. However, it's designed to cater for your needs as a student. Student credit cards tend to have low credit limits and charge higher interest rates than regular ones.
The idea is to help you budget and build your credit rating for future financial applications, like buying a house, without the risk of getting deep into debt.
Applying for a credit card is a serious commitment, so you must know all the ins and outs before filling out any applications. We've compiled a list of the advantages and disadvantages of having a student credit card.
✔️ Protection on purchases: a student credit card has the same level of purchase protection as regular credit cards. The consumer credit act protects purchases between £100 and £30,000 against any issues.
✔️ Building credit: using a student credit card and repaying the balance on time is a great way to start building credit.
✔️ Credit card rewards: depending on which student credit card you choose, you could earn extra rewards for using your new credit card.
✔️ Spread the cost of purchases: in need of a large purchase? A student credit card allows you to pay for large purchases and spreads the cost making it more manageable.
✔️ No annual fees: most student credit cards have no annual fees.
✔️ Interest-free period: some credit card providers offer introductory interest-free periods that you can use.
❌️ Lower credit limit: student credit cards usually have much smaller credit limits than a normal credit card; they can start from £50 and onwards.
❌️ Potential high-interest rates: most students don't have an excellent credit rating. So, most student accounts will have a higher APR rate than regular credit cards—usually around 39.9%. However, if you keep up with the minimum monthly repayment and pay back your credit card balance in time, you won't be charged interest.
❌️ Fees: much like credit cards, there will be fees for cash withdrawals from your credit card. It's best to avoid making withdrawals the best you can.
❌️ Marks on your credit score: a rejected application can leave a mark on your credit report. However, most credit card companies have an eligibility checker you can do before filling out an application to avoid any impact on your credit file.
Some student credit cards come with multiple features that allow you to take advantage of credit building whilst being rewarded for purchases. It's all about looking for the best student credit card that suits your needs and offers you the best deal.
What You Need to Open a Student Credit Card Account
Now that you know about student credit cards, you may wonder if you can apply.
Each company will have its rules and requirements for applicants, but most will share some standard criteria.
Like any credit account, there's a criteria you'll have to meet:
- Be aged 18 or over.
- Resident in the UK.
- Studying at a UK university.
Some companies will require a credit history, whereas some are completely fine if you've never used credit. So, we've considered this with our recommendations that you'll read about soon.
When looking for the best student credit card, you must ensure you've got the right paperwork to make the process as smooth as possible. If you're applying online or in-branch, ensure you have the following documents ready:
- Proof of identification.
- Proof of study.
- Proof of address.
It's also important to know that some credit card companies require you to have a student current account with them before you can apply for a student credit card. However, other options are available if you have an existing account with a different bank.
How We Choose the Best Student Credit Cards
Before we dive into our top student credit cards, let's explore how we decided on the top picks.
Factors we considered:
- Interest-free periods: you must get the most out of your credit card, so we looked at ones that offered an interest-free period.
- APR rates: although they're usually high for student credit cards, we found ones that offered great APR rates.
- Credit limit: we've found a range of cards with various credit limits. However, your limit is usually dependent on your credit file.
- Annual fees: all the cards we've recommended have zero annual fees. However, always read the terms and conditions to avoid hidden fees.
- Features: we looked at cards that offered more than one feature. Some allow you to use them for everyday purchases and use them abroad if you decide on studying abroad as part of your studies.
- Customer service: if any issues occur, it's good to know you’re supported and can contact a customer service team whenever needed.
- Eligibility: we've included cards that are great for students with poor credit history and ones suited for students with no credit history.
Best Student Credit Cards in the UK
With all of the above factors, we've found the six best student credit cards for you.
1. HSBC Student Credit Card
If you've already got an HSBC student bank account, you may be eligible for an HSBC Student Credit Card. This student credit card offers a personalised cashback offer through the Visa Offers programme, so you can earn cashback while using your credit card.
Representative Example – If you spend £500 at a purchase interest rate of 18.9% p.a. (variable) your representative APR will be 18.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ Control your credit card with online banking and banking via the HSBC Mobile Banking app.
✔️ Are you planning on studying abroad for a year? You can use your credit card abroad in all regions supported by the Visa and Mastercard networks.
✔️ You’ll receive personalised cashback offers.
❌️ You must already have a student bank account with HSBC to be eligible.
❌️ A lower credit limit than other student credit cards.
2. TSB Student Credit Card
With the TSB Student Credit Card, you can enjoy flexibility with your purchases with a credit limit personalised to your application. This credit card is ideal for college students as well as university students.
Representative Example – If you spend £1,000 at a purchase interest rate of 21.95% p.a. (variable) your representative APR will be 21.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ Available to those with a poor credit history.
✔️ Relatively higher credit limits in comparison to other student credit cards.
✔️ You can add your credit card to your Apple Pay and Google Pay.
❌️ You need to have a current account with TSB to be eligible for this credit card.
❌️ No rewards.
3. Aqua Advance Student Travel Credit Card
The Aqua Advance credit card is ideal for students studying abroad at University. Study abroad at ease with no fees on international transactions. This card is also suitable for building your credit report as it accepts applications with a poor credit record.
Aqua Advance Student Travel Credit Card
No interest-free period, however, if you stay within your credit limit, you can reduce your interest rate by 5% annually for three years.
Credit limit £250 to subject to status.
No extra fees on what you spend abroad.
Representative Example – If you spend £1,200 at a purchase interest rate of 34.9% p.a. (variable) your representative APR will be 34.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ Reduce your interest rates by 5% each year.
✔️ It helps increase your credit rating.
✔️ Ideal for use abroad as there are no foreign transaction fees.
❌️ Higher interest rates than other student credit cards.
❌️ No rewards.
4. Vanquis Bank Classic Credit Card
The Vanquis Bank Classic credit card is ideal for students with little to no credit history. It's ideal for first-time credit card holders as it helps you build your credit report and rewards you for paying back your balances with credit limit increases every five months.
Representative Example – If you spend £250 at a purchase interest rate of 39.9% p.a. (variable) your representative APR will be 39.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ You can increase your credit limit by using and paying off your credit card on time.
✔️ Express Check eligibility checker.
✔️ Applicants with no credit history can apply.
❌️ Higher interest rates than other student credit cards.
❌️ No rewards.
5. Capital One Classic Credit Card
Although the Capital One Classic credit card has no student-specific features, it's ideal for applicants with some credit history. If you're a second or third-year student who has built some form of credit history through overdraft usage and direct debits, this credit card is ideal.
Capital One Classic Credit Card
For people with bad credit or building credit.
Credit limit £200 to £1,500.
Interest-free period up to 56 days on purchases each billing period for cleared balances.
Representative Example – If you spend £1,200 at a purchase interest rate of 34.94% p.a. (variable) your representative APR will be 34.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ You can check your eligibility before applying to avoid unnecessary marks on your credit rating.
✔️ You can still be considered even if you've had any defaults in your credit history.
✔️ No income is required, but you do need to make repayments on time.
❌️ Applicants with no credit history may be rejected.
❌️ No rewards.
6. Barclaycard Forward Card
The Barclaycard Forward Card is ideal for students with part-time jobs looking to build their credit history. This student credit card is ideal if you need financial help at university. Each applicant's credit limit is personalised.
Representative Example – If you spend £1,200 at a purchase interest rate of 33.9% p.a. (variable) your representative APR will be 33.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.
✔️ Ideal for part-time workers.
✔️ Interest-free purchases for the first three months.
✔️ Free Apple subscriptions for up to five months.
❌️ You must earn at least £3,000 annually to be eligible.
Tips for Using Your Student Credit Card
Now that you're aware of student credit cards, we want you to encourage safe credit card spending.
Having a credit card is a big responsibility. Although it can be exciting to purchase anything (within reason) at any time you want, you should remember a few things:
- Student discounts: buying things on credit is great, but remember to use your student discounts when shopping. Not only do they help you get a better deal on your shopping, but they will help reduce your credit card spending.
- Open a student current account: student bank accounts usually have great benefits like an interest-free overdraft. Consider opening a student current account to help you get a credit card at the same bank.
- Consider a savings account: having a savings account is good practice for anyone as it allows you to put any extra cash aside for future use.
- Avoid cash withdrawals: withdrawal fees can be heavy, so avoiding taking cash from your credit card balance is recommended.
- Minimum repayments: to avoid interest charges and continue to build credit, you need to make the minimum payment on your credit card every month. To avoid paying APR, you should pay off your entire balance before it's due.
With these great tips, you can successfully build credit and enjoy your university experience without worrying about needing more money in your accounts. Let one of our chosen credit cards ease your mind, and go out and make the most of your time as a student.
Final Thoughts on Getting a Student Credit Card
A student credit card is a great way to start building your future. You may not buy a house until your late twenties, but building a positive credit file can begin as early as eighteen. Prepare for your future with accessible budgeting with one of the recommended credit cards.
Before you commit to opening a credit card account, you must make the right decision. Consider the following:
- Other options: are there other options that may be easier to pay back or have better interest rates? Opening a student account with overdraft options may be better for your needs as the credit limit is sometimes higher than a student credit card.
- Financial needs: can you afford to make repayments on time, and if you can't, do you have any backup options to help you? Only apply for a credit card if you can repay the borrowed balance.
- Reason: consider why you want a credit card. If you're looking for extra money for no real reason, there may be better options than this. However, if you want to take control of your budgeting and create a good credit rating, a credit card can help you.
- Quick access to cash: there are better options than a credit card for cash withdrawals as you may end up paying a high fee; consider personal loans if you require a cash advance. However, a credit card is a great backup plan if you want to be more prepared for unexpected expenses.
At CompareBanks, we empower you to take control of your finances. You can compare all the banks and financial institutions in the UK in one place to help you find the right student credit card.
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