Are your credit card payments becoming too much of a burden? If you're paying high interest on your balance every month, it's time to shop for a balance transfer credit card in the Philippines. This can help prevent worst-case scenarios like accumulating huge credit card debt.
Manage your credit card payments better through a balance transfer. Learn what a balance transfer credit card is, how it works, and your best options in this helpful guide.
A balance transfer credit card is a low-interest card to which you can move the amount you owe from your other high-interest cards. Because of the lower interest rate, most of your payments will go toward your principal balance instead of the interest charges.
This type of credit card also simplifies your payments by consolidating your balances on other cards into one monthly payment and due date.
When you're approved for a credit card balance transfer in the Philippines, your new card provider will pay your outstanding balance to the original issuing bank. The balance will then be moved to your new card, this time with an interest rate that's lower than regular rates.
The rates of balance transfer credit cards in the Philippines go from as low as 0% to 2%, depending on the transfer amount and the cardholder's selected repayment period. In contrast, regular credit cards have an interest rate of 3%.
A balance transfer credit card can thus help you save money on interest payments. Because your monthly payments will be applied to your principal balance instead of the finance charge, you can pay off your debt faster.
Yes. Consolidating your credit card balances into one allows you to keep track of only one card instead of having to deal with multiple monthly payments and due dates. This helps prevent missed payments and late charges on your bill.
Related reading: Take Back Control: Credit Card Amnesty Program in the Philippines
The right credit card features spell the difference between paying off your balances fast and getting buried deeper in debt. Here's how to free up your finances with the best balance transfer credit card.
Pay close attention to the following when choosing from different balance transfer credit cards in the Philippines:
Once your card is approved, an introductory rate is charged to your transferred balance for several months. The lower the rate, the lower the charges you'll pay.
Banks set different balance transfer rates per installment term. Look at the rates for the same installment term for an apples-to-apples comparison. For example, if Bank A offers 0.88% interest for 12 months and Bank B offers 1.50% for the same period, you'll get a better deal with Bank A.
Some banks also offer a 0% balance transfer in the Philippines. Depending on the bank, it usually lasts for only two to six months from the approval date. You won't pay interest within this time, so your monthly payments will all go toward your credit card debt.
After that period, the interest will rise to the regular rate, which could be higher than that of your original card. So make sure to look for the lowest balance transfer rate in the Philippines.
Consider the amount you need to transfer to a new credit card. The amount you can transfer depends on the issuing bank's limits.
Banks set a minimum amount and require it to be within the unused credit limit of the balance transfer card. It's a matter of choosing which bank matches your needs.
Low-interest balance transfer offers last for a limited period only. You can pay your transferred balances in installments ranging from three to 60 months.
Shorter installment terms have slightly higher balance transfer rates, making monthly payments more expensive. But over time, you can save on interest payments.
On the flip side, longer terms are more manageable on the budget, but you'll pay more interest.
When comparing and choosing from the available payment terms, consider your monthly budget, your balance transfer amount, and the balance transfer rate. It allows you to determine the right term based on what you can afford to pay monthly.
There are costs involved in transferring your credit card debts. First is the processing fee, which is a fixed amount (usually ₱100 to ₱300) charged per approved balance transfer. Some banks charge it, others don't.
If you wish to pay off your transferred balance before the end of your installment term, the bank may charge a pre-termination fee, either a fixed amount (₱300 to ₱550) or a percentage (usually 4% or 5%) of the remaining balance.
It's also important to prioritize cards with low interest rates (charged after the end of the installment term) and low or no annual fees. If these two fees are high, they'll just offset the savings from the low balance transfer rate.
Lastly, consider the late payment fee if you pay your credit card bills beyond the due date.
Related: 12 Credit Card Fees in the Philippines to Watch Out For
Metrobank Balance Transfer Calculator
Which program offers the most affordable monthly payment based on your transfer amount and preferred installment term?
Compute that figure to know which bank allows you to save the most on payments. Metrobank has a balance transfer calculator[1] on its website so you can get estimates for monthly amortizations.
For banks that don't have an online balance transfer calculator, refer to their sample computation table and use their formula for computing the monthly installment.
Here are some of the best balance transfer credit cards:
Find more details and options below.
Read more: Why Get Another Card: Is Having Multiple Credit Cards Good or Bad?
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Get more out of your Metrobank Titanium Mastercard®. Aside from extended balance transfer plans at 60 months, you enjoy low balance transfer rates and the chance to earn non-expiring rewards points for every ₱20 you spend.
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HSBC also offers a balance transfer plan that you can pay for up to 24 months with a minimum installment amount of ₱500. Check out the HSBC Red Mastercard, which comes with a low minimum monthly income requirement.
After you pay off your balance transfer plan, you can earn bonus points with every ₱20 you spend and 4x bonus points on shopping, online, and overseas purchases.
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With the Security Bank Gold Mastercard, you can enjoy a low transfer rate of 1% for up to 24 months. Plus, it earns non-expiring rewards points for every ₱20 spend, letting you accumulate points fast. Moreover, you enjoy waived annual fees in your first year.
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BPI's lowest balance transfer rate of less than 1% is available on the 36-month installment option. If you want to pay off your transferred balance sooner, you may choose from six, 12, 18, and 24 installment terms—all of which come with 1% interest.
If you're looking for the best BPI balance transfer credit card, consider the Edge Card, which charges a low annual fee and earns rewards points.
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UnionBank's in-house installment facility allows you to transfer balances from other credit cards to your UnionBank credit card via EasyTransfer. Processing takes 10 banking days.
Consider the UnionBank Platinum Mastercard. Get 1% cashback on all purchases, from shopping, dining, travel, and more.
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Are you looking for a balance transfer credit card in the Philippines with a low income requirement? Check out the PNB Essentials Mastercard, which you can qualify for if you have at least ₱10,000 monthly income. Moreover, applications are processed within seven banking days.
The PNB Essentials Mastercard earns rewards points that you can convert to miles or cash credits. Your supplementary cardholders also enjoy no annual fees for life.
Related reading: Fly for Free When You Convert Your Credit Card Points to Miles
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RCBC also offers one of the lowest balance transfer rates at 1%. The Flex Visa is the best RCBC credit card for balance transfer because of its low annual fee and generous rewards. With an RCBC credit card, you can pay your other cards' balances in three, six, nine, 12, 18, 24, and 36 monthly installments.
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Bank of Commerce Platinum Mastercard is another option for the best balance transfer credit cards in the Philippines.
It has a low rate of 0.49% when you transfer at least a ₱20,000 balance from another card and pay it off in 36 monthly installments. Meanwhile, the rate is 0.88% if you pay at least ₱10,000 in 12 monthly installments and 0.60% if you transfer at least ₱20,000 and pay in 24 monthly installments.
If you’re looking for the lowest balance transfer rate in credit cards in the Philippines, check out the Bank of Commerce Platinum Mastercard and enjoy significant savings.
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Another credit card with a low balance transfer rate comes from China Bank. You can pay your transferred balances in three, six, nine, 12, 18, or 24 installments at 1% interest.
For maximum savings on your credit card payments, get the China Bank Freedom Mastercard with waived annual fees for life.
The application process for balance credit cards in the Philippines varies per bank, but here's the general procedure to give you an idea.
First, apply and get approved for a credit card with another bank. Make sure the new card is eligible for a balance transfer. You can transfer your balance as long as the receiving card is not issued by the same provider.
Banks require cardholders to wait a minimum period before applying for a balance transfer. It can take as fast as five days after card approval as in the case of BPI, or as long as 25 days for new China Bank credit cardholders.
Once you qualify for the bank's balance transfer program, request to transfer your credit card balances from other banks through your new provider's customer service hotline or website.
You may be required to submit any or all these requirements via email, via online banking, or personally at a bank branch:
Your balance transfer application will undergo a verification and evaluation process, typically lasting eight banking days. While waiting for the bank's decision, continue paying at least the minimum balance on your other credit cards.
If you're approved, your new credit card provider will pay off your other cards' outstanding balance to your old bank. Once the payment is reflected in your old card’s billing statement, coordinate with the bank to close your credit card accounts.
The balance gets transferred to your new credit card account and deducted from your available credit limit. Afterward, you can start paying your installments to your new credit card provider.
These credit cards are a valuable tool in keeping your finances under control. As long as you get the best balance transfer credit card in the Philippines and use it responsibly, you won't have to worry about accumulating credit card debt again.
Source: [1] Metrobank Balance Transfer Calculator