Credit cards for people on Centrelink

Can I apply for a credit card if I’m receiving government assistance?

Some credit cards will accept your application with proof of Centrelink payments to meet the income criteria. This can include:

• Austudy
• Carer's allowance
• Child support payments
• Child care benefits
• Centrelink long-term pensions
• Parenting payments
• Foster care allowance
• Family tax benefit A and B

The credit card issuer will consider other factors including whether you have employment, your credit history, expenses and liabilities. If you're not sure if you're eligible, contact the credit card provider directly to discuss your options.

You can compare details for some Australian credit card issuers below to see whether or not they consider specific benefits.

^{*N/A - In this instance, the institution doesn't have a set policy on this, so you'll need to contact them directly to discuss it on a case-by-case basis.}

How do I apply for a credit card if I have more than one source of income?

If you receive income from a few sources – such as child support payments, Family tax benefit A or B and a casual job – you should include details for all of them when you apply for a credit card.

Every card provider has a different application form, but you list your main source of income (such as a casual or part-time job) when asked to nominate your income. And if you receive a parenting payment from Centrelink you would list that under additional sources of income.

You'll probably need to provide documents to establish each source of income. This includes payslips or bank statements.

How can I increase my chances of credit card approval if I'm on Centrelink?

There's no guarantee of approval for a credit card in Australia. But these 4 steps can increase your chances of successfully applying for one.

1. Compare your options

Different types of credit cards can suit different needs. For instance:

• If you receive a relatively low income, consider a card with low minimum income requirements and a low minimum credit limit.
• If you'll only use a card for emergencies, a card with $0 annual fee won't burn a hole in your pocket while you're not using it.
• If you think you might not pay off the balance in full each month, consider a card with a low interest rate for purchases.

Once you've narrowed down the type of card you want, compare a few different cards. Just remember to look at the rates, fees, features and eligibility requirements before picking a card.

2. Check the eligibility requirements before applying

These usually include:

• Age. You must be at least 18 years of age to apply.
• Residency. You typically need to be an Australian citizen, permanent resident or hold a valid visa.
• Income. Minimum income requirements for credit cards can start from $15,000. But a lot of banks don't state a minimum income anymore. They assess your application based on how your income supports your living expenses, including if you receive regular income.
• Credit score. Most credit card issuers will only consider applicants with good credit scores. If you want to check your credit score before you apply, you can get your credit report and score for free on Finder.

3. Organise the required documents

You'll be asked to provide proof of identification (such as your driver's licence or passport) and proof of income. This may include recent pay slips, bank statements and documents from Centrelink.

4. Only apply for one card at a time

Every credit card application you make is listed on your credit report. Applying for too many credit cards in a short period of time can lower your credit score.

So, aim to only apply for one card at a time. If your application is rejected, spend some time (usually at least 6 months) improving your credit score before you apply for another one.

Alternatives to a credit card when you're on Centrelink

It can be difficult to get approved for a credit card when your main source of income is from JobSeeker or another Centrelink payment. But if you need access to funds, some other options to consider include:

• Personal loans. There are some personal loans with low income requirements. But as they may have higher interest rates and fees than other loans, make sure you consider the costs and compare options before deciding to apply.
• No interest loans. No Interest Loans (NILs) offer up to $3,000 for people who earn less than $70,000 (or $100,000 as a couple). These loans are administered by Good Shepherd and are available through a range of non-profit community organisations around Australia.
• Centrelink advance payment. You can ask for a one-off or regular advance from Centrelink when you're recieving an eligible payment, including JobSeeker, Family Tax Benefit A, Age Pension, Carer Payment and Austudy. You can check if you're eligible and apply through MyGov, the Express Plus app, in a service centre or by calling 136 240.
• Buy now pay later. Services like Afterpay and Zip give you a way to buy what you want and pay it off in instalments. Most buy now pay later accounts have a regular account fee, as well as late payment fees (or in some cases, interest charges), which can become expensive if you use it a lot and/or don't meet the repayment requirements.

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