If you’re in Australia on a working or study transfer for a limited time, or are a temporary resident hoping to apply for permanent residence, there are lots of reasons why you’ll want to apply for an Australian credit card:
- Convenience. Paying with cash or cheques is awkward and time-consuming, and using a debit card means that you miss out on the interest-free days offered by a credit card.
- Avoiding foreign transaction fees. If you’ve brought with you a credit card issued overseas, you’re probably going to be hit with foreign transaction fees every time you use it in Australia.
- Avoiding currency fluctuations. An overseas credit card also puts you at the mercy of currency exchange rate fluctuations, not to mention the lengthy process involved in paying off your overseas credit card balance from an Australian bank account.
- Build Australian credit history. Using an Australian credit card is a good way to build up a credit history in Australia, which will make it easier if you need to take out a loan for a car, for example.
So, as a temporary resident you would be well advised to apply for an Australian credit card, and the good news is that there are many cards available for you to choose from.
A wide range of options and benefits
All of the Big Four Australian banks (ANZ, Commonwealth, NAB and Westpac), plus American Express and some of the lesser or overseas-owned banks, are prepared to issue credit cards to holders of the visa type ‘Temporary Skill Shortage Visa (subclass 482)’ (or ‘TSS visa’). You’ll be able to choose from a variety of interest rates, rewards programs, complimentary benefits and annual fees, whether you’re looking for a Visa, Mastercard or American Express card.
Temporary Skill Shortage Visa (subclass 482) ('TSS visa')
Previously known as the Temporary Work (Skilled) Visa (subclass 457), this type of visa is issued to business professionals and skilled workers (and their immediate family) for stays of up to four years, when sponsored by an Australian employer.
Other types of temporary resident visa include the Temporary Graduate Visa, the Temporary Work (International Relations) Visa, working holiday visas for young people, and various student and training visas. Holders of these types of visas may also be able to apply for an Australian credit card.
Income requirement may be higher
One drawback of applying for a card as a temporary resident is that the card issuer may require you to demonstrate a higher level of income when compared with the conditions relating to Australian citizens or permanent residents. This is because there may be difficulties in obtaining your credit history information from overseas, meaning that your income and assets are the only basis on which to assess your creditworthiness.
Since there is a minimum income threshold for workers granted a TSS visa (the Temporary Skilled Migration Income Threshold), currently set at $53,900, an annual income of at least this amount should be sufficient to qualify for many credit cards. Even if you’re allocated a fairly restrictive credit limit to begin with, you may be able to apply for a higher limit once you’ve established some credit history in Australia.
The bank issuing the credit card is likely to ask for a copy of the relevant pages in your foreign passport, so that (with your permission) they can check your visa status through the Visa Entitlement Verification Online (VEVO) system.
Australia has a compulsory personal identification system for financial institution customers, called the ‘100-point check’. When you first open an account with a new bank, you need to produce documents proving who you are and where you live. Many of the point-scoring documents, such as utility bills or a Medicare card, are issued only in Australia, and temporary residents or recently-arrived applicants may have difficulty in producing them. Fortunately, a foreign passport alone will usually score 70 points, an Australian driver's licence or tertiary student identity card will add another 40 points, while a foreign or international driver's licence will add 25 points. You may find it easier to apply for a credit card issued by the bank where you have your everyday banking transaction account, to avoid going through the 100-point check procedure twice.
You will also need to provide details about your employer and your income, and the bank will almost certainly want to verify this with your employer since they will have little else on which to assess your creditworthiness. Other documents you could be asked to produce include your foreign birth certificate or citizenship certificate and your foreign driver’s licence. Some card issuers may also want to know not just your current address but your last overseas address as well.
You can read more about how to prepare your application in this guide.
Get a supplementary card, or primary card, for family members
Your spouse, or another family member living with you in Australia, could have a supplementary card on your account. Do remember though, that you, as the primary account holder, have sole responsibility for repayment of the total account balance, including any purchases they may make using their supplementary card.
Family members accompanying the primary visa holder are usually also allowed to work in Australia. So they may have their own income, as a basis for applying for a credit card in their own name.