How do credit cards work?
What’s a credit card?
In bankspeak, it’s called a ‘revolving line of credit’. This just means it’s a card with a set amount of funds (we call that a ‘credit limit’) that you borrow from a bank and can use anytime.
When you use your card to make a purchase, you then need to pay it back. You’ll be charged interest on the amounts you don’t pay back each month, there’s a minimum monthly repayment to avoid a late fee, and some cards will have an annual fee.
Before you apply for a credit card, make sure you’re comfortable making your repayments.
Credit card repayments.
How do they work?
We’ll send you a statement each month showing the amount you've spent and any fees or charges accrued that month. It’ll also show your minimum payment amount, amount due immediately (if any) and due date.
You can either:
- Pay your entire closing balance. This means you avoid any purchase interest and payment fees, and you’ll keep any interest free periods.
- Pay your minimum payment amount and any amount due immediately so you're not charged a late payment fee.
- Pay something in between. If you pay anything less than your closing balance, purchase interest will be charged on the remaining balance (minus any balance transfers, promotional offers or Easy Instalments) and you’ll lose any interest free periods.
If you can, aim to pay off your entire balance to avoid having to pay interest on your purchases.
Ways to make your repayments.
In the Bankwest App
- Navigate to ‘Money’ then ‘Accounts’
- Select your credit card account from the list
- Tap settings in the right-hand corner then ‘Make a repayment’.
In online banking
Go to ‘Payments & transfers’, then ‘Make a payment’, and then click ‘Internal Transfers’ to transfer the desired amount from one of your Bankwest accounts to your credit card account.
Over the phone
Give us a call on 13 17 19 and select the ‘self-service phone banking’ option. Make sure you’ve got your statement and your account details handy.
Using BPAY®
Make a BPAY payment using the payment details on your credit card statement.
Bank@Post
Payments can be made by cash or cheque at your local participating Post Office. Find the closest Bank@Post location to you on the Bank@Post website.
Tips for making your repayments on time.
- Consider setting up a direct debit at least for your minimum repayment amount each month so you're covered in case you forget – that way you get to avoid late fees. Start by completing a direct debit request form.
- Schedule a repeating payment for a fixed amount and date in the Bankwest App or online banking.
- You can opt to get a push notification when your minimum repayment is due. Simply log in to the app, select the bell icon in the top right-hand corner, then the settings icon and turn on the notifications you want to be reminded about.
- Set up payment reminders and we'll send you an email to let you know when a new Statement is available.
Credit card fees.
You’ll find the full list of fees you might be charged in the T&Cs, but here’s some of the more common ones.
Annual fee.
Most cards will have an annual fee. As a general rule, the more features a card has – like rewards programs, complimentary insurance or fee waivers – the higher the annual fee will be.
- Don’t need all the bells and whistles? Check out our no annual fee credit card
Late payment fee.
If you don’t make your minimum monthly payment on time, you’ll be charged a late fee. If your statement refers to an “Amount Due Immediately” you must also pay that amount by the due date, in order to avoid the fee.
Cash advance fee.
If you withdraw cash from your credit card at an ATM or a branch, or if you use your credit card to buy cash equivalent items like travellers cheques, it’s called a cash advance. You’ll be charged interest (cash advance rate) and a fee (cash advance fee) when you make one.
Choosing the right credit card.
Consider the different features on offer, how you’re planning to use the card and how you might make repayments to see which one best suits your needs.
Low rate credit card.
If you don't think you'll pay off your full balance each month, you may want to choose a low-rate credit card so you pay less interest on the amount remaining. Low-rate cards are also great for bigger one-off purchases rather than everyday spending.
Low fee credit card.
Picking a card without an annual fee could save you hundreds of dollars.
Low fee cards usually have higher interest rates, but if you pay off the balance every month you can avoid paying interest on your purchases.
Rewards credit card.
Shop around for a rewards card that suits your limits and spending habits to earn rewards points on your eligible purchases. Our More Rewards credit cards allows you to redeem points for cashback or digital gift cards. If you're a Qantas frequent flyer, consider a Qantas credit card. Keep in mind these cards usually have higher interest rates.
No foreign transaction fees credit card.
Our Platinum and World credit cards have no foreign transaction fees. These will waive the charge for international online purchases or transactions you make when overseas.
If you have a Breeze Platinum Mastercard, Qantas Platinum Mastercard, Qantas World Mastercard, More Platinum Mastercard or More World Mastercard you may get some complimentary benefits – like overseas travel insurance.
Common questions.
You may be able to withdraw cash from your credit card at an ATM – this is called a cash advance. But keep in mind cash advances come with a few fees:
- Cash advance interest charges: the interest you pay on cash withdrawn from an ATM is higher than if you were to use your credit card to make a purchase. Cash advance interest will accrue daily from the day the money is withdrawn.
- Cash advance fee: 3% of transaction amount or $4 (whichever is greater)
- ATM fees: if you withdraw from a privately owned ATM, you may incur an ATM fee from the operator. We’ll also charge $0 overseas ATM fees on our Platinum and World credit cards, though some overseas non-bank ATM operators may charge a fee.
Things to consider.
BPAY® is the registered trademark of BPAY Pty Ltd ABN 69 079 137 518.
Bank@Post is an agency service provided by Australia Post on behalf of Bankwest. Bank@Post is available at participating Post Offices. Services available are cash withdrawals, deposits, balance enquiries and credit card repayments. Limits apply.
Mastercard and the circles design are registered trademarks of Mastercard International Incorporated.