Credit cards are powerful financial tools — but only if you understand how they work. Below are answers to some of the most common credit card questions Singaporeans ask!
Does applying for a credit card hurt my credit score?
Typically no, unless you apply multi credit cards in a month. In Singapore, every credit card application results in a hard inquiry with Credit Bureau Singapore (CBS). Generally, one credit card per month is considered okay.
What really affects your credit score is:
- The timeliness of your credit card payments (i.e. on time and in full)
- Consistent monthly credit card spend without huge fluctuations
What happens if I miss a credit card payment?
Missing a payment have some consequences.
If you miss the minimum payment:
- You may be charged late payment fees
- Interest charges apply to unpaid balances
- it is recorded by CBS, if not quickly paid up before the next statement cycle, which can affect your credit score
However, you should ALWAYS try to get a late payment fee as well as interest charges waiver by contacting the customer service or via the bank app. In addition, Setting up GIRO payments or reminders can help avoid accidental missed payments.
Should I cancel a credit card I don’t use?
Not always — it depends on the card.
If a card has no annual fee, keeping it open can help maintain a longer credit history and preserve your total available credit. If the card has an annual fee and no longer provides meaningful benefits, it may make sense to cancel or downgrade it.
Before cancelling, remember to:
- Clear all outstanding balances
- Redeem any unused points or rewards, as some programmes forfeit them upon cancellation
How many credit cards are “too many”?
There is no fixed number, but “too many” usually means more than you can manage comfortably. Many Singaporeans do well with 3–6 cards, each serving a clear purpose (e.g. cashback, travel, dining, petrol). Problems often arise when cardholders:
- Lose track of due dates
- Miss minimum spend requirements
- Pay annual fees unnecessarily
- Allow points/miles to expire or be deducted without realising
If managing your cards feels stressful, that’s often a sign you have too many.
Do I need to pay interest if I pay my bill in full?
No. If you pay the full statement balance by the due date, you will not be charged interest. Credit cards offer an interest-free grace period, provided payments are made on time.
Interest applies only if:
- You pay less than the full statement balance, or
- You miss the payment deadline
This is why credit cards work best when you pay in full and on time.
When should I redeem points instead of cashback?
It depends on your spending habits and lifestyle.
- Points or miles tend to offer better value if you:
- Travel regularly
- Redeem for business class flights
- Can plan redemptions in advance
- Cashback is often more suitable if you prefer simplicity and consistent savings on everyday spending.
