In the last 10-15 years credit card business in Pakistan has received an overwhelming response from customers and has opened up a new avenue for banks to earn huge profits. The beneficiaries are not only the wealthy and elite but also the middle class whether they are employed at some organization or having their own business, you can apply for credit cards online as well!
By virtue of its nature, credit cards brought convenience and safety for everyone; they come handy in case an emergency arises at odd hours. A wise man once said “credit cards are two way swords”, this is quite factual and the card holder needs to be smart while spending money, particularly when the income is limited.
Although all credit cards offer revolving credit and a person can get away by paying small portion of the amount spent or by paying “minimum payment” but this could be inviting oneself into a debt trap. Any salaried employee can apply for a credit card if his salary is Rs. 25,000 or above with minimal requirements. He only needs a letter from the employer stating he is a permanent employee, salary slip and CNIC.
Generally, the credit limit on a card is 2.5 times the salary of the applicant. Which means if a salary is Rs. 30,000 the credit limit can go up to Rs. 75,000. However, this is not necessary and the discretion entirely lies with the bank.
Credit Cards for Salaried Employees
To answer to a question which credit card is best for a salaried employee in Pakistan varies depending on various accounts. There are quite a few things employees should look for when applying for a credit card. A thorough research is needed and answers for below questions must be found:
- What is the joining fee?
- What is the annual fee?
- What is the mark up rate?
- What are the hidden charges?
- What are the fringe benefits and discounts available?
On regular basis, banks offer packages enticing customers to become members without any joining fee. This aspect requires a thorough research. There is another amount bank charges to its customers recognised as an annual fee. This fee varies from Rs. 2,500 to Rs. 10,000. For a salaried employee whose income is between Rs. 25,000 and Rs. 50,000, 10k is a big amount, therefore he needs to choose a card which has an annual feel less than Rs. 5,000. Below is the table, consisting of annual fees which would help applicants to select a card of their choice.
|Issuing Bank||Card Type||Annual fee (Rs)|
|HBL FuelSaver Green||MasterCard||3,000|
|Standard Chartered Cashback||MasterCard||3,000|
|Standard Chartered Easy||MasterCard||2,500|
|Silk Bank Gold Visa||Visa||4,000|
|JS Bank Classic||Visa||2,400|
|Allied Visa Gold||Visa||2,000|
|Standard Chartered Titanium Credit Card||MasterCard||5,000|
Credit Card’s Financial Charges
The difference of mark up rate on all cards dwells between 28% and 42%. This is one area which is neglected by new applicants perhaps because of lack of knowledge or in an excitement of getting a card. It is also not highlighted by Banks because they fear they may shy away customers.
Few hidden charges are also there such as credit shield cover, insurance etc which are usually mentioned in fine prints and often not read by customers. It is advised to the customers that they must categorically ask banks the detail of such charges. There are several numbers of benefits; customer can avail by having the right card; such as discounts at food joints and restaurants, clothing outlets, air miles, international acceptability, access to lounges at airports and several others.
However, low end credit cards with small annual fee and relatively low limit may not have all the benefits. Salaried person must look for a card which offers the benefits he wants to use frequently. A person who is not a frequent flyer does not need a card that offers air miles, airport lounges or discounts in ticketing. He can opt for a card that has more value for him at food outlets or stores.
To sum it up choosing a credit card largely depends on a person income and preferences. Card that suits A may not be the best choice for B. Therefore, it is necessary for any customer to first conduct the research and prioritize the need before finalizing the selection of a Credit Card.
It is surely not easy to consider one credit card as one of the best among all other options because each one of them have their own benefits. Though, it is the special feature that matters for every card apart from the financial features.
The reason is that the relevant benefits makes the card ideal for any prospective customer. For example, for one person Faysal Bank’s credit card may seem very useful because of the large number of dining discounts available for the customers. Though, for the person who is a frequent flyer, the credit card of Standard Chartered may seem useful because of obtaining air miles and access to Airport Lounge. Therefore, in the end, it is solely the benefits that every card offers to the customers.