Credit Card Terms in the Philippines for Beginners

If you’ve ever wondered how credit cards work or if you're considering applying for your first credit card, it’s important to start with the basics—understanding credit card terms. From interest rates and annual fees to credit limits and late payment charges, credit cards come with a set of conditions that can either help you build your financial future or cause unnecessary stress if misunderstood. Whether you're a student looking to start building credit, a freelancer managing fluctuating income, or someone simply exploring the convenience of cashless payments, knowing these terms can help you use credit responsibly.

In the Philippines, more and more people are using credit cards not just for shopping or emergencies, but also to access installment plans, earn rewards, and take advantage of exclusive perks. But with so many options available, choosing the right card—especially your first—can be overwhelming. That’s why we created this guide to help you break down credit card terms and find the easiest credit card to get, particularly for first-time applicants.

What Are Credit Card Terms?

Credit card terms refer to the conditions and fees associated with using a credit card. These include the interest rate, credit limit, annual fees, and penalties for late payments. Familiarizing yourself with these terms can help you manage your finances effectively and avoid unnecessary charges.

Credit Card Terms You Need to Know

Before choosing the best credit cards for beginners in the Philippines, understanding these basic credit card terms first can help you use your card wisely and avoid financial pitfalls:

• Credit Limit – The total amount you’re allowed to borrow. Try to use only up to 30% of your limit to keep your credit utilization healthy.
• Interest Rate/Finance Charge – If you don’t pay your balance in full, this is the cost of borrowing, typically around 2% to 3.5% monthly in the Philippines.
• Annual Fee – A yearly fee charged for maintaining your credit card. Some cards waive this for the first year or even for life.
• Minimum Amount Due – The smallest amount you need to pay to avoid penalties. Paying only this amount, however, means you’ll be charged interest on the remaining balance.
• Late Payment Fee – A penalty charged if you miss your payment due date. Fees range from ₱250 to over ₱1,000, depending on your provider.
• Cash Advance Fee – A charge incurred when withdrawing cash from your credit card. This also comes with a higher interest rate and no grace period.
• Billing Cycle – The period of time (typically 30 days) between your last statement and your current one. All purchases, payments, and charges made during this period will reflect on your next bill.
• Statement Date – The date when your billing cycle ends and your bill is generated.
• Due Date – The final date by which you need to pay at least the minimum amount due to avoid penalties or interest.
• Grace Period – The time (usually 20–25 days) between your statement date and due date when you can pay your balance without being charged interest—if your previous bill was paid in full.
• Minimum Amount Due – The smallest amount you’re required to pay by the due date to avoid late fees. Paying only the minimum, however, leads to interest on the remaining balance.
• Finance Charges – The total cost of carrying a balance on your card, including interest, late fees, and other charges. This is often detailed in your monthly statement.
• Security Code/CVV – A 3- or 4-digit code found on your card used for online or over-the-phone purchases. It helps protect you from unauthorized transactions.
• Overlimit Fee – A penalty charged when your outstanding balance exceeds your approved credit limit. Some banks automatically block transactions that would go over your limit.
• Supplementary Card – An additional card linked to the primary account. Ideal for family members—especially seniors or students—without a primary income. The primary cardholder remains responsible for all charges.

What’s the Easiest Credit Card to Get in the Philippines?

The easiest credit card to get usually has low minimum income requirements, simplified approval, or is a secured card (backed by a savings deposit). These are ideal if you’re a student, freelancer, or new employee building your credit history.

Some great beginner-friendly options include:

BPI Amore Cashback Card

• Low minimum income
• Cash back on supermarkets and department store spends

AUB Classic Mastercard

• No annual fees
• Simple rewards program
• Low minimum income requirement

Bank of Commerce Classic Mastercard

• Simple rewards program and installment plans
• Ideal for beginners

RCBC Classic Mastercard

• No annual fees for the first year
• Easy rewards points system
• Budget monitoring tools

PNB Essentials Mastercard

• No annual fees for life
• Simple reward points
• Flexible payment options

BPI Gold Rewards Card

• Low minimum income
• Travel perks
• Flexible installment options

RCBC Gold Mastercard

• No annual fees for the first year
• Easy-to-earn reward points
• Secure online shopping

Maybank Standard Mastercard

• No annual fees for the first year
• Ideal for young professionals and frequent travelers

UnionBank Lazada Credit Card

• Earn points on Lazada purchases
• Great for online shoppers and new applicants

BPI Rewards Card

• Low minimum income requirement
• Easy-to-use rewards system
• Travel perks

Look for credit cards with annual fees of ₱3,000 or less to keep costs manageable. If possible, go for one that offers no annual fees for life so you can save even more in the long run. You also need to keep in mind other credit card fees and charges when selecting your first card.

Tips to Manage Your Credit Card Responsibly

No matter which credit card you choose, the key to long-term success is using it wisely. Being a conscientious credit card user can help boost your credit rating and provide you with a way to make purchases conveniently.

Here are some smart habits to follow:

✅ Pay in Full – Avoid interest by paying your statement balance in full every month.

✅ Stick to a Budget – Only charge what you can afford to pay off.

✅ Set Alerts – Use mobile banking notifications to track transactions and due dates.

✅ Avoid Cash Advances – These come with high fees and no interest-free period. 

✅ Review Your Statement – Check monthly bills for incorrect or fraudulent charges.

Being a responsible cardholder helps build your credit history and makes it easier to qualify for better financial products in the future.

Final Thoughts

Getting your first credit card is an exciting step toward financial independence, but it also comes with responsibility. Understanding basic credit card terms like interest rates, annual fees, and payment schedules can save you from future headaches. Whether you’re trying to figure out how credit cards work or searching for the easiest credit card to get, knowledge is your best financial tool.

Use the Moneymax’s credit card comparison tool to explore and compare options based on your lifestyle and income level. It’s free, user-friendly, and can help you find the perfect card match in just a few clicks.

Sources:

^[1] 6 Major Credit Card Mistakes (Investopedia, 2024)