University is a big step. Alongside the increase in academic difficulty, you’ll have to learn how to look after yourself, including how you spend your money. Lots of students learn the valuable skills of saving and budgeting whilst at university. However, sometimes, you might need a little bit of extra money. Although you could ask your parents, there are lots of options to explore, such as student credit cards.
Students can get credit cards which are designed specifically to teach them how to budget and pay back debt. This form of spending is called a student credit card and is designed for those aged 18 and over who are studying at university. The student credit card works in the same way as a regular credit card but with higher interest rates and lower spending limits.
For more information about how a student credit card works, including the eligibility requirements, as well as the benefits of a student credit card over other forms of card, keep reading.
Table of Contents
Can students get a credit card?
It is certainly possible for students to get a student credit card. As someone who has recently started higher education, there are two ways to use a credit card. You could apply for a regular credit card with your local bank. However, you also have the option to use a student credit card, which is usually easier to apply for as a student and has many advantages.
A student credit card is designed specifically for people aged between 18-21 who are undertaking higher education studies. As long as you’re studying at university at Level 4 and above, you’ll be eligible for a student credit card. Have a look at this Think Student article to read more about what Level 4 actually is.
Student credit cards have several features which differ from regular credit cards, as they are suited to people who have never had a credit card before. They don’t usually require a deposit, as you’ll have very little or no credit as an 18-year-old student.
Alongside this, student credit cards also have a low credit limit so that you can’t get into too much debt. For more of the differences between regular and student credit cards, as well as more information about what a student credit card is, read this article from Experian.
How do you get a credit card as a student in the UK?
Student credit cards are not available to everyone. You must meet several criteria in order for a bank or building society to offer you a student credit card. You must be aged at least 18 or over and should be studying at a university in the UK.
Technically, some banks offer student bank accounts to those studying for higher apprenticeships. However, apprenticeships students are not always eligible for student credit cards. It all depends on which bank you apply to and your specific circumstances.
To apply for a student credit card, you’ll simply need to visit a bank branch, either in person or online. From there, the application process is the same as with any other card. You’ll need to prove your identity, including your age and which university you’re studying at. This will prove that you’re eligible for the card.
Although lots of banks offer student credit cards, some offer a much better deal than others. Most big-name banks offer good quality student credit cards which will be worth your time. To make sure you’re using the best card for you, use a comparison website to see which banks will offer the cheapest rates.
This article from Money Super Market contains a card comparison tool, as well as more information about student credit cards in general.
What are the benefits of a student credit card?
There are many benefits to student credit cards, which is why they’re so popular. One of the biggest advantages is that student credit cards allow you to build a credit history without getting into any debt. By borrowing small amounts, you can slowly boost your credit score, making you more eligible for loans in the future.
Student credit cards also have a limit on the amount you can spend. For this reason, it’s very difficult to spend more than you’ll be able to pay back. Therefore, student credit cards are great for people living at university. You can get a quick top-up before pay-day but will always be able to pay the amount you borrow back within a reasonable amount of time.
Some student credit cards also offer interest-free periods. This is not necessarily true of all student credit cards. However, some banks allow students to borrow money without having to pay interest on top of their repayments, provided they pay the money back within a certain amount of time.
When you go abroad, you usually have to take a currency card. This is because most credit and debit cards will charge large conversion fees. However, most student credit cards allow you to spend your money in other countries without charging any foreign transaction fees.
Some student credit cards come with extra perks and rewards. For example, you may be allowed to receive cashback on your money in certain shops or you might be given air miles for your loyalty. Read the terms and conditions of your contract to find out what rewards you may be eligible for.
For more information about the benefits of student credit cards and who they are best suited to, read this article from money.co.uk.
What happens to your student credit card when you graduate?
Once you graduate from university, you can continue to use your student credit card. You can keep using the card until its expiry date. If you want another credit card, you’ll have to apply for a regular credit card as you’ll no longer be eligible for the student version.
However, lots of students opt to transfer between student and regular credit cards as soon as they graduate. On a normal credit card, there are often better interest rates on the money in your bank account, so you’ll earn more from your money. They might also give you a lower interest rate on your repayments.
Getting better interest rates depends on how effectively you budgeted on a student credit card. If you paid back your credit efficiently and managed to build a good credit score, the bank will be happy to transfer you between cards.