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Benefits of a credit card with no joining and no annual fee

A credit card that doesn’t have any upfront or annual charges is a good way to enjoy the perks of having a card without worrying about the fees eating into your finances.

Credit cards have become increasingly popular for purchases and bill payments. They often provide useful benefits and rewards, like discounts and airline lounge access. But some people shun credit cards because of their fees and consider products like lifetime free credit cards instead. 

A credit card with no joining fees and no annual fees is especially appealing for occasional credit card users who don’t want to have to commit to regular fee payments. 

It can also be a useful way to build your credit history without incurring any extra costs.

Explore: Different types of credit cards

How do credit cards with no joining fees work?

Generally, when you apply for a credit card, you’ll need to pay a joining fee, an annual fee, or both. Annual fees are the charges you must pay to use the card and enjoy its benefits. 

The joining and annual fees for a credit card can vary, according to the perks and rewards they offer.

A credit card with no annual fee works like any other credit card. The only difference is that you’re not charged a fee for using your credit card.

What are the benefits of a no-fee credit card?

Many zero-fee credit cards and lifetime free credit cards come with a range of benefits, such as:

  • Rewards – depending on the type of card, you could earn reward points that can be redeemed for benefits like air miles, vouchers, services, offers, exclusive privileges and memberships
  • Credit score – if you’re a new credit card user, your credit score will improve as you make purchases and pay your statement in full and on time
  • Buy now, pay later – credit cards offer the convenience of making cashless payments in a secure way and paying later at no extra charge, as long as you pay your bill on time
  • Fuel surcharge fee waiver – some rewards credit cards with no annual fee offer a waiver on fuel surcharges, which can lead to significant savings every time you fill up
  • Insurance coverage – you could get insurance for travel, health, and purchase protection, including coverage for any misuse of your card from 24 hours before reporting it lost
  • Emergency card replacement – you can get an emergency card anywhere in the world if you lose yours

It helps to understand how your credit card works and spend accordingly. For instance, some cards may offer more rewards for fuel purchases, but less for other shopping. So, align your spending and redeem your rewards to get the most out of your credit card. 

Find out more: How to get lounge access with your credit card

Are there any drawbacks?

If you’re paying no fees for your credit card, you could expect:

  • Limited features – you may get fewer credit card rewards and benefits compared to premium cards
  • Higher interest rates – there may be higher interest charges if you carry a balance
  • Credit limit restrictions – some credit cards that don’t have a fee may come with lower credit limits

Don’t forget that you still need to pay off your credit card balance in full every month by the due date to avoid interest charges. This amount will depend on how much you owe on your credit card.

Explore: How does a credit card work?

Apply for an HSBC Visa Platinum Credit Card

No joining or annual fees for the credit card that opens the door to incredible experiences.

Takeaway

A rewards credit card with no annual fee and no joining fee could be an option if you want to manage your finances without paying unnecessary charges.

Think about whether you’ll ever use the rewards and benefits that come with a premium credit card. If not, then a no annual fee credit card can offer a better deal and save you money in the long term.

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