The best credit cards in Australia

best credit cards in Australia
The best credit cards in Australia

A credit card gives you access to revolving credit that you can spend to make purchases online and off and earn great rewards.

We’re going to take a look at the different types of credit cards in Australia and discuss how to choose the best option and manage your credit card long-term.

Credit cards are revolving loans because the money you spend is borrowed from the card provider rather than debited from your account. There is a wide range of credit cards in Australia which are issued by banks, building societies, or another type of credit providers.

Although finding a credit card might seem easy, the sheer number of options makes it difficult to choose and so we will help you get to grips with the best credit cards in Australia to help ease the process.

There are thousands of credit cards available in Australia. The best way to choose a credit card is to know the reason you need it and figure out the type of credit card you want based on your needs.

The credit cards you can choose from the start from your basic no-frills low-rate card to your premium card with a lot of perks and benefits such as Slow Lounge access and free travel insurance or extended purchase warranty.

Standard credit cards (known as ‘plain-vanilla’)

Plain-vanilla credit cards offer no frills or rewards. You might choose this type of credit card when you need a credit card that is not complicated, and you have no interest in earning rewards. It allows you to have a balance up to a specific credit limit. When you have used up your limit, more credit is made available once you've made a payment.

Balance transfer credit cards

A balance transfer card allows you to save money by transferring a high-interest-rate balance from an existing card. Although most credit cards come with the ability to transfer balances, a balance transfer credit card is one that offers a low introductory rate when you transfer money for a certain period. Some of these cards have interest rates as low as 0 per cent, but these usually have strict qualifying criteria.

Rewards credit cards

Rewards cards offer rewards on credit card purchases.

The Rewards cards types are:

  • Cashback
  • Points
  • Travel rewards and discounts

Student credit cards

Student credit cards are designed for college students and are designed with the understanding that these young adults often have little or no credit history.

Student credit cards come with additional perks like rewards or low-interest rates on balance transfers. But most importantly, students must be enrolled at an accredited four-year university to be approved for a student credit card.

Charge cards in Australia

They do not have a spending limit. You should pay back the balance in full at the end of each month. When you pay late you will be subject to a fee, charge restrictions, or card cancellation depending on your card agreement.

Secured credit cards

These cards are designed for people who don't have a ​credit history or have a bad credit status. When you take out the card, you will be required to have a security deposit to be placed on the card.

Your credit card limit will be equal to the amount of the deposit made on the card, but it could be more in some cases. Except for the security deposit, you will still be required to make monthly payments on your secured credit card balance.

Subprime credit cards

Subprime cards are designed for applicants who have a bad credit history and these cards typically have high-interest rates and fees. The Federal Government has made rules regarding the number of fees subprime credit card issuers can charge, but the issuers often look for loopholes and ways to skirt these rules.

Prepaid credit cards

A Prepaid cardholder is required to load money onto the card before the card can be used. Purchases made are withdrawn from the card's balance. Your spending limit depends on the money loaded onto the card.

All prepaid cards have no finance charges or minimum payments because the balance is withdrawn from the deposit you've made. You cannot boost your credit score with a prepaid card.

Limited purpose cards

Limited-purpose cards are designed for a specific purpose and can only be used at specific locations. They have a minimum payment and finance charge.

Examples of limited-purpose cards

  • Gas credit cards
  • Store credit cards

Business credit cards in Australia

Business credit cards are designed for business use only. They give business owners an easy method of keeping business and personal transactions separate.

However, even when you apply for a business credit card, your credit history is considered because the credit card issuer still needs to hold an individual accountable for the credit card balance.

Types of business credit cards

  • Standard business credit card
  • Charge card

How credit cards work in Australia

With a credit card, you get money on your credit card, unlike a business or personal loan where you get money in your bank account. Your lender will set you a credit limit, and you’ll be able to spend as much of it as you need.

When you reach the end of your billing cycle, you receive a statement that tells you the total amount you owe for that period. You will be required to pay it back it in full or in monthly instalments that both you and your lender agreed on.

Ways to use a credit card

A credit card can help you build a strong credit report only if you perfectly follow the general rules when you use it:

  • Keep your credit utilization ratio low – the credit utilization ratio is the amount of credit you’ve used compared to what you have available. Most credit card lenders will prefer you to keep your ratio under 30%. Using more than your limit will show that you are financially stretched and therefore a high-risk borrower.
  • Make your repayments on time - most credit cards charge a fee when you miss payments and lose any benefits or incentives attached to your credit cards, such as low or zero interest periods or cashback Furthermore, missing too many payments can harm your credit report.
  • Set up a direct debit - direct debits are so good for those who have a lot of debts to pay at the end of each month since it will ensure that you do not forget to pay off your balance each month.
  • Don’t withdraw cash or use it abroad – if it’s not stated on your credit agreement, avoid withdrawing cash or use your credit card abroad because you will be charged a fee.
  • Take advantage of rewards – some credit cards have rewards like cashback on purchases or Airmiles every time you spend, but lenders often charge a fee for these cards. If the rewards will be useful to you then it may be worth the cost. But if you won’t be able to take advantage of them you should consider whether you need a credit card.

A credit card for you & your needs

All the credit cards that are offered in Australia, are the best cards for a certain individual and for a certain situation. The most important thing when you choose a credit card is to choose the one suitable for your needs and consider your affordability while taking the card.

Use your card wisely because a credit card can improve your credit status as well as lead you to poor credit status. Avoid taking out a credit card that has a lot of benefits even if you will not be able to use the benefits.

Popular & reliable direct lenders offering Credit cards

  1. Westpac Credit card


    • Earn rewards
    • Low interest rates
    • Interest from 9.90%
  2. Aussie Credit card


    • Get approved online
    • Easy repayments
    • Interest from 12.49%
  3. Virgin Money Credit card

    Virgin Money

    • Interest free cards
    • Earn reward points
    • Interest from 6.9%
  4. Bank of Melbourne Credit card

    Bank of Melbour...

    • Online management
    • Get approved fast
    • Interest up to 12.99%