A Step-by-Step Guide to Obtaining Your First Credit Card in Bangladesh
Step 1: Evaluate Your Eligibility
Before applying for a credit card, it’s essential to assess whether you meet the eligibility requirements set by banks. In Bangladesh, most banks require applicants to be at least 21 years old with a steady income or employment. Additionally, banks may ask for proof of identity, address, and income. Some banks also offer student credit cards, which have minimal income requirements but may still demand certain conditions like having a student bank account.
Step 2: Compare Credit Card Options
Bangladeshi banks offer a variety of credit card options tailored to different lifestyles and financial needs. Major banks like BRAC Bank, Eastern Bank Limited (EBL), Standard Chartered, and City Bank offer different types of cards like classic, gold, platinum, and co-branded cards. Compare factors such as annual fees, interest rates (APR), rewards programs, and credit limits to choose the best one for your needs.
Step 3: Gather Required Documents
To successfully apply for a credit card, you’ll need to prepare several documents. Typically, you’ll be asked for copies of your National ID, passport-sized photographs, bank statements, salary slips, and proof of residence. Some banks may require tax identification numbers (TIN) and additional references. It’s a good idea to check with your preferred bank beforehand regarding their specific document requirements.
Step 4: Submit Your Application
Once you have evaluated the available credit card options and prepared your documents, you can proceed to submit your application. Most banks in Bangladesh allow applications both online and offline. You can visit the bank branch or apply directly through their website. After submission, the bank will likely review your creditworthiness based on the documents provided, your income, and other factors.
Step 5: Wait for Approval
After submitting your application, it can take anywhere from a few days to a couple of weeks for the bank to process and approve your credit card request. The timeline may vary depending on the bank, the type of card applied for, and your credit profile. During this period, the bank might call for additional documentation or to verify details provided.
Step 6: Activate Your Credit Card
Once approved, you will receive your new credit card along with instructions on how to activate it. Activation is a simple process that can typically be done through a phone call, SMS, or the bank’s official app. Be sure to read the terms and conditions included with your card to understand your responsibilities, including the billing cycle, interest charges, and any applicable fees.
Step 7: Start Using Your Credit Card Responsibly
Congratulations! With your first credit card in hand, it’s important to use it wisely. Make sure to clear your balances each payment period or make at least the minimum required payment to avoid late fees and interest. Building a strong credit history in Bangladesh involves using your card responsibly, which will also help increase your credit limit and open up opportunities for future financial products.
Top 5 Banks Offering the Best Credit Card Deals in Bangladesh
1. BRAC Bank
BRAC Bank is known for offering a wide range of credit cards with attractive benefits for various customer needs. Their “TARA” card, aimed at women professionals, stands out for its exclusive lifestyle rewards and lower interest rates. The bank also offers free supplementary cards, flexible repayment options, and extensive reward programs on shopping, dining, and travel. Another notable feature is the zero annual fees for certain types of cards if you meet specific spending criteria.
2. Eastern Bank Limited (EBL)
Eastern Bank Limited (EBL) provides some of the most popular credit card options in Bangladesh, especially its EBL Signature Visa and EBL Global Credit Cards, which cater to both local and international needs. These cards offer premium benefits like complimentary airport lounge access, extensive reward points, and special discounts on lifestyle products and services. Their reward and cashback systems are highly beneficial for frequent travelers and shoppers, making EBL one of the top choices for those seeking value-added services.
3. Standard Chartered Bangladesh
Standard Chartered is one of the few international banks operating in Bangladesh, and it offers a host of premium credit cards catering to affluent customers. Their Platinum and Gold cards provide luxury benefits such as exclusive offers at high-end restaurants, cashback on fuel purchases, and flexible installment payment options. Additionally, Standard Chartered’s priority banking clients enjoy even more exceptional services such as concierge and roadside assistance, setting them apart in the market.
4. City Bank
City Bank is particularly well-known for its American Express credit cards. The Bank’s American Express Gold and Platinum cards come with enjoying privileges like access to airport lounges, dining discounts, and travel insurance coverage. City Bank AMEX cards are also recognized for their generous cashback offers and zero late-payment fees under certain conditions, making them a top contender for frequent flyers and shoppers. Furthermore, the “Citymaxx” card is ideal for everyday users looking to maximize their savings on daily expenses.
5. Dutch-Bangla Bank Limited (DBBL)
Dutch-Bangla Bank Limited (DBBL) offers several types of credit cards, with its Visa and MasterCard options being especially appealing for average consumers looking for budget-friendly options. DBBL cards come with low-interest rates, easy reward redemption, and additional perks like discounts at partner outlets and free supplementary cards. Moreover, their focus on safe and secure transactions makes DBBL a trusted choice among many first-time credit cardholders in Bangladesh.
Credit Card Requirements and Eligibility Criteria for Bangladeshi Citizens
Age Requirement
In Bangladesh, the age requirement to apply for a credit card is typically set at a minimum of 21 years. Some banks offer student credit cards that may have a lower age limit, usually 18 years, but these cards often come with additional stipulations like having a co-signer or a student bank account. For most standard credit cards, applicants must be over 21 and under a certain upper age limit, usually 60 to 65, depending on the bank.
Income and Employment Status
The applicant’s income level is one of the key factors banks consider when evaluating credit card eligibility. You must have a steady source of income, either through employment or self-employment, and earn a minimum monthly income based on the specific requirements of the bank and type of credit card you are applying for. Typically, this income threshold ranges from BDT 15,000 to BDT 40,000 per month. If you are self-employed, providing proof of stable business income is essential.
Bank Account with the Issuing Bank
Some banks in Bangladesh may require you to have an existing customer relationship, such as a savings or current account, before offering you a credit card. This is especially common among local banks that prefer customers to maintain an account for several months, where they can assess your regular transactions and savings behavior. For international banks like Standard Chartered, having an account with them might not always be mandatory, but it could expedite the approval process.
Valid Identification Documents
Applicants must provide valid identification documents as part of the credit card application process. The most commonly accepted forms of identification include a National ID (NID), passport, or a driving license. Additionally, some banks may require verification of your Tax Identification Number (TIN), particularly for higher-tier credit cards. Bear in mind that photo identification must be official and up-to-date for the application to proceed smoothly.
Proof of Residence
Proof of residence is a necessary document for credit card applications in Bangladesh. Applicants are required to submit documentation that verifies their current address. Typically, acceptable forms of proof include utility bills (electricity, water, or gas) not older than three months, rental agreements, or residential certificates issued by local authorities. Ensuring the accuracy of your residential information is crucial as any discrepancies can delay your application.
Credit History and Score
A strong credit history plays a critical role in determining credit card eligibility. Although some first-time applicants may not have a well-established credit score, many banks still conduct background checks through credit bureaus in Bangladesh like the Credit Information Bureau (CIB). Individuals with a poor credit history may face rejection or receive lower credit limits. On the other hand, a solid credit score increases your chances of approval and offers more favorable terms such as higher limits and lower interest rates.
Guarantor or Co-Signer Requirement (For Specific Cards)
For applicants who are just starting in the workforce, students, or those with lower income levels, some banks in Bangladesh may request a guarantor or co-signer. A guarantor is someone with an established credit history who agrees to take responsibility for the cardholder’s debt if they fail to make payments. This requirement is more common when applying for special credit cards like student cards or low-income cards.
Understanding Annual Fees and Interest Rates for Bangladesh Credit Cards
Annual Fees: What to Expect
Most credit cards in Bangladesh come with an annual fee that cardholders are required to pay to maintain their account. This fee is charged once a year and can vary significantly based on the type of card and the benefits it offers. For example, standard cards generally have lower annual fees compared to premium cards like platinum or signature cards. While some banks waive the first year’s fee as part of promotional offers, it’s important to check if there are any conditions, such as minimum spending requirements, to continue qualifying for fee waivers in subsequent years.
Interest Rates: The Basics
In Bangladesh, credit card interest rates, often referred to as Annual Percentage Rate (APR), can range from 24% to 36% annually. Banks charge this interest on outstanding balances after the payment due date has passed. However, if you pay your full balance on time every billing cycle, you can usually avoid interest charges altogether. It’s crucial to know the specific interest rate for your card type, as banks may offer different rates for different tiers of cards. For instance, basic cards might have higher interest rates than premium ones that offer perks like cashback or exclusive discounts.
Balancing Fees and Benefits
Paying high annual fees might make sense if your credit card offers considerable rewards or benefits, such as cashback on purchases, travel insurance, or access to airport lounges. Though cards with low or no annual fees may seem attractive at first, they often offer fewer rewards or have stricter limitations on how you can redeem points or cashback. When choosing a card, factor in both the annual fee and the rewards structure to see if the benefits outweigh the costs in the long run.
Understanding Grace Periods
A grace period refers to the number of days you have to pay off your balance before interest begins to accrue. In Bangladesh, grace periods typically last between 20 to 50 days depending on the issuing bank. If you consistently pay your bills within the grace period, you can effectively use your credit card without paying any interest. Be sure to verify the exact grace period terms for your card and mark your calendar with due dates to avoid incurring unnecessary charges.
Penalty Fees and Late Payments
Making late payments can result in significant penalty fees that are separate from interest charges. In Bangladesh, late fees are generally imposed when you fail to meet either the minimum payment or the full amount due by the deadline. These fees can be as high as BDT 1,000 to BDT 2,500 per billing cycle, depending on the financial institution. To avoid these penalties, consider setting up automatic payments or payment reminders through banking apps or alerts.
How Cash Advances Are Handled
Withdrawals from ATMs using your credit card, known as cash advances, come with their own set of fees and interest rates. In Bangladesh, credit card holders can expect cash advance interest rates that are generally higher than standard purchase rates, often starting immediately from the cash withdrawal date. Additionally, a one-time cash advance fee, typically around 2%-3% of the withdrawn amount, can further add to the cost. Avoid using credit cards for cash advances unless absolutely necessary to prevent accruing high fees.
Negotiating Lower Interest Rates and Fees
If you’ve had a good payment history with your card provider, you might be able to negotiate lower interest rates or even request a waiver of the annual fee. Some banks in Bangladesh allow customers to apply for lower interest rates on a case-by-case basis, especially if you’ve demonstrated responsible credit usage. Similarly, you could ask for a reduction in fees, especially if you’re considering canceling your card or switching to another provider. Keep in mind, however, that not all banks are flexible with fee negotiations.
Benefits and Rewards Programs: Choosing the Right Credit Card in Bangladesh
Understanding Credit Card Reward Points
One of the most attractive features of credit cards in Bangladesh is the reward points system. With each purchase, you accumulate points that can later be redeemed for goods, services, discounts, or even cashback. Depending on the bank and the type of credit card, reward points may be earned at varying rates. For example, certain premium cards offer higher points accrual on specific categories like dining, shopping, or travel compared to standard cards. Make sure to choose a card that aligns with your spending habits to maximize your rewards.
Cashback Offers
Cashback credit cards are increasingly popular in Bangladesh as they allow cardholders to earn a percentage of their spending back as cash credits. Depending on the issuing bank, cashback can range from 1% to 5% on everyday purchases like groceries, fuel, and dining. Some cards may offer even higher cashback rates during promotions. It’s wise to opt for a credit card that offers cashback features if you’re looking for straightforward savings on routine expenses.
Travel Rewards and Lounge Access
For frequent travelers, many banks in Bangladesh offer travel-based reward programs. Premium cards like the Standard Chartered Platinum or City Bank American Express Platinum often provide travel-related perks such as free access to airport lounges, air mile points, and discounts on hotel bookings or airline tickets. If you travel frequently, either domestically or internationally, selecting a credit card that provides complimentary lounge access can help make your trips more comfortable and cost-effective.
Dining and Retail Discounts
Several credit cards in Bangladesh partner with restaurants, cafes, and retail stores to provide special discounts and exclusive deals. Cards such as BRAC Bank’s TARA credit card cater specifically to women and offer substantial markdowns at fashion retailers, beauty salons, and fine-dining restaurants. Similarly, banks like EBL and City Bank feature cards that give significant discounts on high-end dining and exclusive retail outlets, making them ideal for lifestyle-conscious individuals.
Fuel Savings
If you frequently commute by car, a credit card offering fuel discounts might be a practical choice for you. Some banks in Bangladesh provide a certain percentage of cashback or price reductions on fuel purchases. For instance, Standard Chartered Bangladesh offers up to 5% cashback on fuel expenses for certain premium-tier cardholders. This benefit can add up quickly and result in significant savings over time, especially for individuals with heavy driving needs.
Flexibility in Redeeming Rewards
Not all rewards programs are created equal—some offer more flexible redemption options than others. While some banks will let you redeem points for immediate cash credits or purchase discounts, others offer conversions into vouchers, air miles, or products from a catalog. It’s essential to review how easy it is to redeem your accumulated reward points. Choose a credit card that offers flexibility in using your rewards, whether that means cashback, travel benefits, or discounts at your favorite stores.
Seasonal Promotions and Bonus Offers
Many banks in Bangladesh run seasonal promotions that can significantly boost your rewards earnings. These promotions often come in the form of extra points, higher cashback rates, or bigger discounts during holidays or special shopping events like Eid or New Year sales. Keep an eye on these limited-time offers, as they can add incredible value to your purchases. Opting for a card that frequently updates its bonus offers will provide regular opportunities for additional savings.
Loyalty Programs and Co-Branded Cards
Loyalty programs integrated with co-branded cards are becoming more common in Bangladesh. You can benefit from partnerships between banks and popular retailers, airlines, or hotels. For example, co-branded cards offered by City Bank in partnership with American Express or local airlines could offer miles or discounts when traveling or booking through specific platforms. If you’re loyal to certain brands or services, choosing a co-branded card can amplify the value of your purchases.
Weighing Annual Fees Against Rewards
While premium cards often provide excellent rewards, they commonly come with high annual fees. Before committing, consider whether the rewards and benefits justify the fee. For instance, if you don’t travel frequently, a high-fee card offering travel-related perks might not provide the best value for your needs. Instead, a no-fee or low-fee card with cashback on daily expenses might prove more beneficial. Evaluate both the rewards program and the associated fees to ensure you get the most out of your credit card.
