What is a Secured Credit Card?

Though it has only been more than two years since I have acquired my first ever credit card, I've noticed lately that some people from work approach me asking for tips on how to avail of one. Being from a BPO company, I'm very much familiar on how hard it is to apply for one especially if you  have less than 2 years of tenure on your company or your salary doesn't meet the minimum requirements. I've had my share of rejection and one thing that I'm sure of is it's easier when starting with a secured credit card.  With this, here are some things I knew about secured credit cards.

What's a secured credit card?

A secured credit card is just like a regular credit card, but the main difference is that you're required to make a deposit which will be held against its credit limit. Your credit limit will usually be a percentage of your security deposit usually 80-90% or it may be the same as your deposit. Many banks place your deposit into a savings account where it stays until you close your account, upgrade to a regular credit card or default on your credit card balance which in this case, it would be used to pay for the unpaid balance. A secured credit card is often recommended for those who are constantly being declined a regular credit card, those who haven't yet established a  good credit or financil history or those who have damaged credit.

Secured credit cards vs. regular credit cards

Aside from the held deposit, secured credit cards are like most other types of credit cards. Every swipe that you make on a secured credit card reduce your available credit and you're required to make at least a monthly minimum payment toward your credit card balance. If your card issuer has a grace period, you can avoid paying finance charges by paying your balance in full before your next statement. Late payments and over-the-limit transactions are penalized with a fee just like any regular credit cards.

Even though your credit limit is secured, you're still required to make at least minimum payments on your balance every month. Not doing so may taint your credit score, and if you default from paying by at least three months depending on the card issuer, your account will be closed and your held deposit will cover the unpaid balance.

Why start with a secured credit card? 
Regular credit cards have stricter credit qualifications like a minimum tenure in a company or a minimim gross monthly or annual salary which make it hard for most to be approved for these cards. Personally, I know few people who have trouble getting approved for regular credit card that they have settled for a secured one.  for a secured credit card much easier than a regular credit card. After a few months of  proving that they are financially responsible, the regular credit card came in succesion, even without them applying for it.

Converting to Regular Credit Card
Most card issuers review your account after a certain amount of time, most likely 12 months at the time you will be charged an annual fee. Of the 4 banks who offer secured credit cards (BPI, RCBC, AUB and Security Bank) though I also heard that Metrobank, Eastwest and BDO offer their clients a version of their secured card, and based on my personal experience, only BPI allows conversion without reapplying. Even if your secured credit card issuer doesn't upgrade you to an regular credit card, you may qualify for one with another credit card issuer after six to twelve months if your secured credit card has reported your credit history to one of the major credit bureaus.

On my next post, I will try to consolidate my experience with 2 of the three secured credit card issuers.  Will do.

Cheers!

Bank Codes in the Philippines

In line with my blog post about adding a bank account to your PayPal account, you need to enter a bank code. as with PayPal Philippines, to complete your PayPal withdrawal, you will need to enter the name of your bank, your bank account number and the corresponding 9-digit bank code, which identifies your bank.

Here's a summary of the different bank codes in the Philippines. 

BANK NAME	9 digit bank code
ALLIED BANKING CORP	010320013
AUSTRALIA NEW ZEALAND	010700015
ASIA UNITED BANK	011020011
BANGKO SENTRAL NG PILIPINAS	010030015
BANGKOK BANK	010670019
BANK OF AMERICA	010120019
BANK OF CHINA	011140014
BANK OF TOKYO	010460012
BANCO DE ORO (& EPCIB)	010530667
BANK OF COMMERCE	010440016
BANK OF THE PHIL ISLANDS	010040018
CHINA BANKING CORP	010100013
CHINA TRUST COMML BANK	010690015
CITIBANK N.A.	010070017
DEVT BANK OF THE PHILS	010590018
DEUTSCHE BANK	010650013
EAST WEST BANK	010620014
EXPORT & INDUSTRY BANK	010860010
FUJI BANK	010640010
HONGKONG AND SHANGHAI BANK	010060014
INTL COMML BANK OF CHINA	010560019
INTL EXCHANGE BANK	010680012
JP MORGAN CHASE BANK	010720011
KOREA EXCHANGE BANK	010710018
INTL NEDERLAND BANK	010660016
LAND BANK OF THE PHILS	010350025
MAYBANK OF THE PHILS	010220016
METROPOLITAN BANK & TRUST CO	010269996
PHIL BANK OF COMMUNICATION	010110016
PHIL TRUST COMPANY	010090039
PHIL NATIONAL BANK	010080010
PRUDENTIAL BANK	010150018
PHIL VETERANS BANK	010330016
RIZAL COMML BANKING CORP	010280014
SECURITY BANK & TRUST CO	010140015
STANDARD CHARTERED BANK	010050011
UNITED COCONUT PLANTERS BANK	010299995
UNION BANK OF THE PHILS	010419995
UNITED OVERSEAS BANK	010270189

Cheers!

How to Add a Bank Account to your PayPal account

I'm an occasional online seller, and in times of sales, I usually prefer cash on collection or meet ups as it is more reliable and no fees are charged. However, venturing on eBay's international selling, I have no choice but to add PayPal as my accepted payment method. When a buyer pays, I would need to withdraw it to my bank account. At this point, I found another use for my Eastwest account as I've read that no fees are charged when withdrawing funds. Will confirm that when I have a balance to withdraw. Unionbank is another option but it charges php10 per ATM withdrawal. Every peso counts. Haha!  What I know is that it would be PayPal who would charge Php50 for each withdrawal instances. So, here's my mini guide on adding your bank account details on your PayPal account.

1. Log in to your PayPal account
2. Click on the "Wallet"link on top of the page.

3. Click on the "Add bank account"link.

3. Enter your bank details, then click the "Save"button. Make sure you provide correct and similar details as to your PayPal details to avoid that Php250 returned fees.

4. Congratulations! You have added your bank account. Easy peasy!

5. You should also receive a confirmation email to your registered email address.

I've read somewhere that PayPal sends a confirmation code to your bank account whenever you add one. I didn't receive any and was not asked to check my online account for a PayPal code. I guess it's because I already have a credit card on file. Or maybe I will  be once I try withdrawing funds. For now, I wait,

Cheers!

Opening a PNB Deposit Account

Now that I have a Philippine National Bank (PNB) Essentials Mastercard, it's inevitable that I would have to pay for the things that  I swiped. I just received my first statement and the hours it took for me to withdraw my funds from my BDO account to paying via PNB bank deposit had me decided to open one so I could enroll it on their online banking system so I could pay my bills online. With it, instead of my funds coming from BDO, I would directly deposit my payments to PNB.

Like any other banks, one cannot open  a PNB bank account without bringing the necessary requirements. With that, one must secure them first before going to any PNB branch, so that your bank account application will be approved. It is also important to select first what PNB branch will you going to open an account. For me it is important that a branch is near my residence or place of work. Luckily, there are two PNB branches near where I lived and I chose to open one that is near a shopping mall.

Requirements in Opening a PNB deposit account

1.) At least two (2) valid id's.

A combination of 1 photo-bearing ID and 1 non photo-bearing ID or a combination of 2 photo-bearing ID's. Bringing both 2 non photo-bearing ID's might not be accepted.

2.) Initial deposit.

It ranges from Php3,000 to Php10,000 depending on the type of account you want to open. However,  I opted  for the TAP Mastercard which requires no initial deposit or maintaining balance but still offers an interest rate. You just have to pay a minimal amount of Php15 every month as an account fee. This is okay for me as I would only use the account for paying my PNB Essentials Mastercard bills.

3.)  2 pcs 1" x 1" or 2" x 2" personal picture. Luckily I had a recent one tucked under the innards of my bag at that time.

4.) Billing statement. I didn't know about this one until I was asked by the bank representative. I told them that all of my utility bills are enrolled under electronic statements of account and have managed to provide a screenshot of some. This is a bit weird for me because as most are encouraged to apply for an online SOA, PNB are still asking for a hard copy. Good thing the bank representative accepted my situation and allowed my application to push through.

I was then asked to complete and sign several forms, which I submit along with photocopy of my IDs and billing statement. The process took 45 minutes to an hour (including the waiting time) and I was told to be back after 10 business days to pick up my card.

It's waiting game again :)