Have a Safer Guaranteed Credit Card with Secure Credit Card
Have you ever heard of a Secure Credit Card (SCC)? Secure credit cards have features, functions, and uses that are not much different from credit cards in general. With a secure credit card, you can also buy items with non-cash or use PayPal services.
However, unlike ordinary credit cards, SCC does not take into account employment status and income. Instead, SCC requires a guarantee fund to be held in an account at the same bank as the SCC issuing bank. The form of funds can be in the form of savings or time deposits.
With minimal requirements, the process of making a guaranteed credit card is even easier and faster than a regular credit card. As long as guarantee funds are available, SCC can be approved immediately.
The guarantee fund is also used as a determinant of the credit card limit. The greater the guarantee fund, the greater the limit that can be obtained. That way, you can set the limit you want. Are you interested yet? However, before applying for one, you may want to understand more about SCC.
The Difference between Credit Cards and Secure Credit Cards
In addition to far less requirements, secure credit cards have several other differences with ordinary credit cards such as:
- Payment Method
SCC users must pay the bill in full payment unlike ordinary credit cards that provide minimum payment options. Even so, banks provide a grace period of payment until the due date.
The ordinary credit card limit has been determined by the bank taking into account the amount of customer income while the SCC limit is determined based on the nominal funds used as collateral. Generally, the SCC limit is 80 – 90% of the guarantee fund.
- Bad Credit
If the credit card bill is not quickly paid, the interest charged will multiply from month to month. If there is no good faith from the customer, the bank can use the services of debt collectors to collect the money.
Unlike ordinary credit cards, debt collector services are not needed in the SCC because if the customer has debt arrears, the bank can take the collateral and close the SCC card.
The Status of the Security Deposit
Funds used as collateral will not be contested by banks as long as SCC payments are always on time. The funds are safe because they are guaranteed by the Deposit Insurance Corporation. Customers will also continue to get savings or deposit interest as usual. However, new funds can be disbursed after the SCC is closed and all bills are paid.
SCC is suitable for those who want to manage expenses by utilizing credit card facilities but cannot meet the credit card submission requirements, for example, small businesses, housewives, and freelancers. This card can also be used as a tool by parents to train children to manage their finances.
Applying for a Secure Credit Card
To make a credit card with collateral, you have to prepare the funds that can be placed as collateral in the card issuing bank, either in the form of savings or deposits. The value depends on the policy of each bank.
After that, you can just come directly to the bank branch office that offers the desired secure credit card or access it online if the banks provide online application submission facilities. However, there are banks that deliberately do not display information about this card on their official website though that does not necessarily mean the bank does not offer a secure credit card accommodation. Therefore, you should come directly to the branch office or contact the relevant customer service to get more complete and accurate information.
If the credit payment history is always running smoothly, this card can also be used as a reference for regular credit card submissions for beginners. Before applying for one, do not forget to pay attention to the fees charged on making and using the card, ranging from annual fees, transaction interest, cash withdrawal fees, late payment fees, and card closing costs.