Credit Cards For First Timers

Compare credit cards for first timers with low fees and rates, ideal for beginners looking to establish a credit history and earn rewards.

By   |   Updated 14 Jun 2024

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Comparing credit cards for first-timers

Bankwest Breeze Mastercard

On website

Balance transfer

12 months at 0% p.a.

Purchase rate

12 months at 0% p.a.

Annual fee

$49.00 p.a. ongoing

Highlights

  • Benefit from 0% p.a. interest on balance transfers for 12 months (with a 2% BT fee, then 12.99% p.a.).
  • 0% p.a. for 12 months on purchases (returning to 12.99% p.a.).
  • Enjoy up to 55 interest-free days on purchases.
  • Exclusive offer for new customers for a limited time. Additional charges, as well as terms and conditions, apply.

Pros

  • 0% p.a. on balance transfers for 12 months.
  • 0% p.a. for 12 months on purchases.
  • Up to 55 interest-free days on purchases.

Cons

  • There are no rewards on this card.
  • There is a 2% BT fee.
The Low Rate Credit Card from American Express

Balance transfer

N/A

Purchase rate

10.99% p.a. ongoing

Annual fee

$0.00 p.a. ongoing

Highlights

  • Benefit from a competitive 10.99% p.a. interest rate for purchases.
  • Enjoy a perpetual $0 annual fee with card ownership.
  • Access up to 55 days interest-free.

Pros

  • Benefit from a competitive 10.99% p.a. interest rate for purchases.
  • Enjoy a perpetual $0 annual fee with card ownership.
  • Access up to 55 days interest-free.

Cons

  • There are no rewards program for this card.
Bankwest Zero Mastercard

On website

Balance transfer

28 months at 0% p.a.

Purchase rate

14.99% p.a. ongoing

Annual fee

$0.00 p.a. ongoing

Highlights

  • Avoid annual fees for the duration of card ownership.
  • 0% p.a. for 28 months on transferred balances (with a 3% balance transfer fee). Returns to 14.99% p.a. thereafter.
  • Enjoy up to 55 days interest-free on purchases.
  • Offer exclusive to new customers for a limited time. Additional fees and charges, as well as terms and conditions, apply.

Pros

  • There is no annual fee for as long as you keep the card.
  • The current balance transfer offer is extremely competitive.
  • Interest on purchases is comparatively low.

Cons

  • Balance transfers incur a one-off fee.
  • You cannot earn credit card points.
Bankwest Breeze Platinum Mastercard

On website

Balance transfer

12 months at 0% p.a.

Purchase rate

12 months at 0% p.a.

Annual fee

$69.00 p.a. ongoing

Highlights

  • Experience 0% p.a. interest on balance transfers for 12 months (with a 2% BT fee, then 12.99% p.a.).
  • 0% p.a. for 12 months on purchases (reverting to 12.99% p.a.).
  • Benefit from up to 55 interest-free days.
  • Offer exclusively for new customers within a specified period. Additional charges, along with terms and conditions, apply.

Pros

  • 0% p.a. on balance transfers for 12 months.
  • 0% p.a. for 12 months on purchases.
  • No foreign transaction fees. Plus, complimentary overseas travel insurance for you and your family.

Cons

  • There is no rewards program on this card.
  • There is a 2% BT fee.
Bendigo Bright Credit Card

On website

Balance transfer

N/A

Purchase rate

9.99% p.a. ongoing

Annual fee

$59.00 p.a. ongoing

Highlights

  • Ongoing interest rate remains low at 9.99% p.a.
  • Benefit from its continual low annual fee of $59 p.a.
  • No charges for extra cardholders.

Pros

  • Up to 55 days interest-free.
  • No fees for additional cardholders.
  • Compatible with Apple Pay, Fitbit Pay, Garmin Pay, Google Pay, and Samsung Pay,

Cons

  • You can't earn credit card rewards.
American Express Explorer Credit Card

Balance transfer

N/A

Purchase rate

23.99% p.a. ongoing

Annual fee

$395.00 p.a. ongoing

Highlights

  • Obtain 50,000 Bonus Membership Rewards Points upon application approval and spending $4,000 on your new Card within the initial 3 months. T&Cs apply. Exclusive to New Amex Card Members.
  • Enjoy a $400 Travel Credit annually for flights, hotels, and car rentals when booked online using this card.
  • Benefit from complimentary domestic and international travel insurance coverage.

Pros

  • The 50,000 bonus Membership Rewards Points when approved and reach spend requirement within the first 3 months.
  • Receive a $400 travel credit every year.
  • Earn 2 Membership Rewards points per $1 spent on purchases except for government bodies in Australia where you will earn 1 point per $1 spent (uncapped).
  • Get two complimentary entries per year to The Centurion® Lounge.

Cons

  • The $395 p.a. annual fee.
Westpac Low Rate Cashback Credit Card

On website

Balance transfer

N/A

Purchase rate

13.74% p.a. ongoing

Annual fee

$59.00 p.a. ongoing

Highlights

  • Get up to $350 cashback when you apply online by 31 July 2024. Receive a $50 cashback monthly for spending over $1,000 in the first 7 statement periods.
  • Enjoy a low ongoing 13.74% p.a. interest rate on purchases.
  • Annual fee of $59 p.a. applies.

Pros

  • Get up to $350 cashback when you meet the criteria.
  • Low 13.74% p.a. interest rate on purchases.
  • 55 days interest-free on purchases.
  • $500 minimum credit limit.

Cons

  • No rewards program although there is a cashback offer.
  • No complimentary travel insurance.
St.George Vertigo Visa Credit Card

On website

Balance transfer

28 months at 0% p.a.

Purchase rate

13.99% p.a. ongoing

Annual fee

$55.00 p.a. ongoing

Highlights

  • Benefit from a 28-month 0% interest period on Balance Transfers, accompanied by a 1% balance transfer fee. Afterwards, it switches to a cash advance rate of 21.49% p.a.
  • Enjoy a low variable interest rate of 13.99% p.a. on purchases.
  • The annual fee remains low at $55 p.a.

Pros

  • 0% p.a. for 28 months on balance transfers with no balance transfer fee.
  • 13.99% p.a. low variable interest rate on purchases.
  • Low annual fee of $55 p.a.

Cons

  • Balance transfer rate reverts to 21.49% p.a. after 28 months.
  • There are no rewards program for this card.
HSBC Platinum Credit Card

On website

Balance transfer

12 months at 0% p.a.

Purchase rate

19.99% p.a. ongoing

Annual fee

$0.00 for 1st year

Highlights

  • Utilize the 0% p.a. offer on balance transfers for 12 months alongside a 2% balance transfer fee.
  • Experience the inaugural year with no annual fee, followed by $149 annually thereafter.
  • Accrue 2 Reward Plus points per $1 spent on qualifying overseas purchases and 1 Reward Plus point per $1 spent on other eligible purchases.
  • Maintain a minimum credit limit of $6,000.

Pros

  • 0% p.a. on balance transfers for 12 months.
  • $0 annual fee for the first year.
  • Enjoy 2 airport lounge passes every year.
  • Benefit from HSBC Instant Savings with exclusive dining and shopping discounts.
  • Includes complimentary travel and purchase protection insurance.
  • Choice of points transfer partners (Asia Miles, KrisFlyer, Velocity Frequent Flyer).

Cons

  • The balance transfer rate reverts to 21.99% p.a. after 12 months.
  • 2% balance transfer fee.
  • The 10,000 points cap per statement period.
ANZ Low Rate Credit Card

On website

Balance transfer

28 months at 0% p.a.

Purchase rate

13.74% p.a. ongoing

Annual fee

$0.00 for 1st year

Highlights

  • Enjoy 0% p.a. for 28 months on balance transfers with a 3% balance transfer fee (then reverts to 21.99% p.a.) Terms and Conditions apply.
  • First-year annual fee waived ($58 subsequently).
  • Continuous low rate of 13.74% p.a. on purchases.
  • Enjoy up to 55 days interest-free on purchases by settling your account completely each month.

Pros

  • Enjoy 0% p.a. on balance transfers up to 28 months.
  • $0 annual fee for the first year ($58 p.a. thereafter).
  • Take advantage of the low purchase interest rate of 13.74% p.a.
  • Add up to 3 additional cardholders at no extra cost.

Cons

  • No purchase or travel insurance included.
  • No rewards program.

Credit cards with low interest rates and minimal fees are ideal for first timer credit card holders, as they help minimise expenses while you become used to your card's features. Additionally, cards with lower credit limits and more accessible minimum income requirements can improve your likelihood of being approved.

There are millions of credit card accounts in Australia, according to the RBA. Their financial flexibility means you can extend your purchasing power today and settle the bill later. However, it's important for first timers to be aware of credit card pitfalls and how they can improve or mess up your credit score.

David Boyd, co-founder of Credit Card Compare

David Boyd, co-founder of Credit Card Compare, explains, "When choosing a credit card for the first time, narrow down your options and carefully consider their terms and features. Things to look out for include low fees, low interest rates, and a set of criteria you qualify for so your application isn't immediately declined. Check your credit score before applying and hold off applying if it flags up issues that need to be addressed. Applying with a bad credit score because of recent missed payments or a default can impact your credit score and make your application more likely to be declined."

Benefits of first timer credit cards

  • Build credit history: Responsible credit card use can help first-timers establish a positive credit history, which is crucial for future financial choices such as applying for a home loan.
  • Convenience: Credit cards offer a convenient payment method for online and in-store purchases. For example, travelling without one makes it tricky to check into a hotel.
  • Security: Credit cards provide added security features such as fraud protection and the ability to dispute unauthorised charges. If you shop from a store that won't give you your money back, you can lodge a chargeback with the issuer.
  • Rewards and perks: Many credit cards offer rewards points, cashback incentives, and other perks to cardholders. However, these are not typically the easiest to get approved for since they usually have a higher set of minimum criteria.

Choosing the best first timer credit card

  • Interest rates: Compare the interest rates on different credit cards. Look for low introductory or competitive ongoing rates to save on interest charges should you not pay the balance in full.
  • Fees: Consider annual fees, late payment fees, and foreign transaction fees. These can add up.
  • Rewards programs: Which rewards program aligns with your lifestyle, spending habits, and preferences as a frequent flyer? If you are a Qantas and oneworld loyalist, then you might consider a Qantas Points-earning credit card over one that earns Velocity Points.
  • Credit limit: Minimum and maximum credit limits vary between different cards. Choose one that suits your financial needs and pattern of spending.
  • Additional features: Consider additional features such as travel insurance and airport lounge access that may benefit you.

Help choosing a credit card for first timers

More about the ins and outs of applying for a credit card for the first time.

  • FAQs

  • Pros & cons

  • Alternatives

  • Hints & tips

  • Why trust us

How do you build credit with a credit card?

Building a positive credit history goes hand in hand with financial literacy and discipline. Your first credit card is a great start to begin building your credit history. To do so, you need to follow a few simple rules so that you are considered a creditworthy person:

  • Make your monthly payments on time, without delay.
  • Avoid carrying a high balance on your credit card. Paying off your balances in full on due date helps you avoid paying any interest on your credit card. Just missing a day can add on interest.
  • Do not max out your credit card. To keep your credit utilisation low, stay well below the credit limit on the card.
  • Begin budgeting your incomes and expenses, especially expenses, from the time you get your new credit card.
  • Avoid opening too many new credit card accounts.
  • Check your credit (rating) regularly so that you avoid unpleasant surprises.
  • Every time you delay or miss payments or incur various penalties, they will go into your credit history.

Use your credit card responsibly and manage your finances carefully to build a healthy credit profile for yourself.

Is a credit card better than buy now, pay later?

Whether a credit card is better than buy now, pay later (BNPL) depends on a number of factors including your financial situation, the types of purchases and payments you need to make.

Taken overall, credits cards are more versatile and can be used to pay for practically anything both online and offline including your taxes. BNPL in contrast is typically only accepted by online or in-store retailers and is of very limited use.

What happens after applying for a new credit card?

When you apply for a credit card the credit card issuer runs identity, fraud and credit checks on you. Most of these processes are highly automated, so you will be quickly informed whether your application has been approved, denied or is pending.

Once you are approved for a credit card, the physical card will be mailed or couriered to you. How long this process takes depends on card issuer. With the card, you will also receive instructions on how to activate your card, such as by placing a call or going online. Once this is done, you can use your new credit card to pay bills or make purchases.

What kind of credit card should you start with?

When choosing your first credit card, look for one with affordable features that make it easy to manage. A credit card with a low limit, minimal fees, and a competitive interest rate is often the best choice for those just starting out.

What happens once you apply for a credit card?

After submitting your application, you'll typically receive confirmation online or via email. Most banks and lenders provide a response within 60 seconds, but they may contact you if additional information is needed before making a final decision.

Can I get a credit card as soon as I start working?

It's generally advisable to wait a few months after starting a new job before applying for a credit card. This allows you to collect payslips, which are required for the application process, and demonstrates to the lender that your employment is stable.

Pros

Ease of access to funds

Your first credit card offers a degree of financial flexibility, enabling you to make purchases or cover unexpected expenses now and pay them off over time. When used responsibly, credit cards are particularly useful for managing cash flow or dealing with emergencies.

Credit building

Timely payments contribute positively to your credit score, which is important should you apply for finance in the future. Avoid carrying a high balance compared to your credit limit to save on interest and keep your credit utilisation level, which contributes positively towards your credit score. Avoid missing payments since these are recorded in your credit report.

Beneficial features

Although most credit cards suitable for a first-timer are no-frills, some do come with additional perks that can enhance the cardholder's experience. These can include rewards programs, complimentary purchase protection insurance, and fraud protection measures, adding value beyond just credit.

Cons

Overuse and debt risk

The convenience of a credit card can also be its downfall, tempting cardholders to spend beyond their means. This risk is heightened if the card offers rewards, enticing users to spend more, either by way of a high annual fee or to exceed spending thresholds to be eligible for a sign-up bonus. Using your credit card without a budget can potentially leading to your getting trapped into problematic levels of card debt, so us your card wisely.

Interest and fees

The cost of borrowing on credit cards is relatively high compared to the borrowing costs for various other types of lending. First time credit card users need to pay attention to this reality when choosing a credit card and compare cards according to not just their perks and benefits, but also their interest rates, annual fees, and other applicable fees.

The interest rates applicable on credit cards can vary significantly from issuer to issuer and even among cards offered by the same issuer. If the full balance isn't paid off each month, interest charges can accumulate quickly, increasing the overall cost of purchases made with the card. Using a card wisely and paying off your balances promptly will help build a good credit history, which would then make you more likely to be approved for more mainstream credit cards in the future.

Credit card annual fees also vary depending on the features and benefits of a credit card. Choosing a card with a low or no annual fee helps keep costs down.

Other costs like foreign exchange fees are charged as a percentage of the transaction costs. Compare these rates also if you have a lot of transactions with overseas merchants or suppliers.

Become an additional cardholder

If your credit score is not established enough to risk applying for a credit card in your own name, or you are not ready to take on the financial responsibility yourself, you could ask to be an additional cardholder on someone else's account.

Being an additional cardholder means you have a credit card available to shop with and make hotel reservations, for example, but you will not establish your own credit score or earn points for yourself. You'll also have to arrange repayment with whoever manages the account.

Buy Now, Pay Later services

Afterpay, Zip, and similar services allow you to make purchases and spread the cost over several payments without interest, provided you pay on time. They appeal to the younger, more debt-averse demographic.

However, some BNPL services do not report your history of repayments to credit bureaus. This means your credit score may not change even though you have a history of timely repayments.

Debit cards

A debit card links directly with your bank account and draws funds from it when you use it to buy something. You can spend up to the amount of money in the account, although daily limits may apply when withdrawing cash.

Besides the money debiting your account when you spend, debit cards' main drawback is the almost complete lack of rewards. There are very few debit cards that earn rewards points in Australia and those few that do have earn rates that pale in comparison to entry level rewards credit cards.

Pay on time

Always make payments on time each payment cycle to avoid late fees and negative impacts on your credit score.

Monitor spending

Keep track of your credit card spending to stay within your budget and to avoid overspending.

Avoid maxing out

Try and use only a portion of your available credit to maintain a healthy credit utilisation ratio.

Review statements

Regularly review your credit card statements for accuracy. Identify any unauthorised charges and contact the card issuer immediately if you see anything suspicious.

Register for SMS or email alerts

That way you will know about every charge that is made on your credit card.

Seek assistance

If you encounter financial difficulties, contact your card issuer and explore options such as payment plans or hardship programs.

Methodology

To determine rankings in our first-timer credit card comparison table, we considered the following relevant attributes and their associated metadata.

  • Annual fee initial year: Whether there is an annual fee in the first year and how much it is. Lower is considered better.
  • Annual fee ongoing: Whether there is an annual fee charged each subsequent year to keep the account open. Lower is considered better.
  • Apple Pay enabled: Whether the card is compatible with Apple Pay. Compatibility is considered beneficial.
  • Card type: Whether the credit card operates on American Express, Mastercard, Visa, etc. because this impacts where it can be used.
  • Foreign exchange fee: Whether foreign transactions or transactions in foreign currency attract a fee and how much it is. Lower is considered better.
  • Interest-free period: The number of interest-free days from statement close when the balance has been paid in full. More is better.
  • Introductory purchase rate: Whether there is an introductory interest rate offer on purchases for a set period, the interest rate, how long it lasts, and what the introductory offer reverts to. A long introductory period of low interest is considered better.
  • Late payment fee: If a monthly payment is late, what will the late fee be. Lower is considered better.
  • Maximum credit limit: If made available by the issuer, what's the highest credit limit possible on the card?
  • Minimum credit limit: If made available by the issuer, what's the lowest credit limit possible on the card?
  • Minimum income required: If made available, how much applicants must earn according to the issuer's eligibility criteria. A lower minimum income requirement means a card is accessible to more applicants.
  • Purchase rate ongoing: What the interest rate is on any purchases that are not paid off in full. Lower is considered better.
  • Rewards program: Whether the card has rewards, the type of rewards (points, cashback, etc.), what they can be redeemed for, etc.
  • Samsung Pay enabled: Whether the card is compatible with Samsung Pay. Compatibility is considered beneficial.
  • Sign-up bonus: Whether there is a bonus of points, cashback, etc. earned after meeting a certain criteria. A large sign-up bonus can be very valuable.

Our rankings may not reflect what matters most to you. Be sure to compare key rates, fees, and features against your own financial priorities before deciding.