Whether you’re thinking about buying a second home in the UK to escape to on the weekends or purchasing a buy-to-let for extra income, there are various taxes and fees to factor in. These include more than just the cost of the property itself.

It’s not always convenient to visit a bank or building society to apply for credit. Similarly, a long phone call to a credit card provider is not everyone’s cup of tea. Thankfully, the days of filling out application forms by hand to send off in the post are all but gone. 

In today’s digital world and thanks to the latest technology, we’re used to doing things more quickly than ever, and often from the comfort of our own homes. The same goes for applying for a credit card. Today you can do it online and find out if you’ve been approved in a matter of minutes.

Choosing the credit card for you

Credit cards can come in handy for all sorts of reasons. Used responsibly, they can have a wide range of benefits and can help improve your credit rating. There are pros and cons to credit cards, and while they are not suitable for everyone, they can be an essential step in your financial journey. 

It’s better to have credit available, even if you don’t use your card often, rather than having no credit at all. This is particularly true when it’s time to apply for a loan or a mortgage. A credit card that you have been paying off in full each month is excellent evidence for a mortgage company to see that you are a reliable borrower. 

There are many different credit cards out there from a wide range of providers. It’s essential to choose the credit card that best suits your circumstances and needs. This will require your research to compare interest rates, key features, and other incentives. Once you’ve done this, it’s time to apply online. Here are some key points to consider when choosing a credit card:

  • Introductory offers – for example, 0% interest on purchases and balance transfers for a set period

  • Interest rates – look for the individual rates on purchases, cash advances, and balance transfers after the introductory period has ended

  • APR – the Annual Percentage Rate is a way of estimating the card’s cost once any initial rate has finished. However, the APR will depend on how you use it, mainly how much you spend and repay

  • Representative APR – this is an example of the APR, but what you are offered might differ based on your credit score

  • Credit limits – this is the total amount of credit you will have available to spend on the card. It is usually based on your credit rating and an affordability check

  • Added incentives and extra benefits – these can include air miles, cashback, and free travel insurance

  • Watch out for charges and fees – this can include late payments and exceeding your credit limit, but there may also be a charge for closing your account early, for example, if you plan to transfer the balance to another 0% interest card

  • Consider what kind of credit card you want – is it for a balance transfer, building your credit, spreading the cost of a high-value purchase, or rewards; check out our credit card guide for more 

  • Try to work out what you will need to pay each month

  • Can you afford it? – this is a crucial question to ask yourself before going ahead as credit cards are only a good idea if they are affordable and used responsibly 

Who can apply for a credit card online?

Whether it’s online or otherwise, you usually must meet the following criteria to be eligible for a credit card in the UK: 

  • Aged 18 or over

  • A UK resident

  • Employed and earning over a certain amount

What should I do before applying for a credit card online?

As well as carefully considering the above points and comparing different credit card products against, there are several things you should do before applying:

  • Make sure you are on the electoral register. It can be tough to get any kind of credit without being registered to vote

  • Work out the cost of having a credit card and if you can afford it 

  • If you have credit cards that you don’t use, you could cancel them before applying for a new one elsewhere 

  • Check your credit score. This is one of the most important things to do before you apply

Checking your credit score

Your credit score is a number rating that reflects the overall health of your credit history. Your score is calculated by Credit Reference Agencies (CRAs). There are 3 primary CRAs in the UK. They each hold a file about you with detailed information about your borrowing and repayments. Good behaviour like making repayments on time helps build your credit and improve your score. 

Getting a copy of your credit file and checking your score is free in the UK. You must do this before applying for any kind of credit, including an online credit card application. 

Credit card providers will check your credit history when they assess your application. If there’s a chance you might be rejected because of your score or mistakes on your file, you should find out about these before any providers do. That way, you can avoid a failed application for a credit card that would make your score worse. 

This can be a potential danger of shopping around for credit cards online, and it is something to watch out for. While it’s good practice to compare products, be careful not to apply multiple times. 

Sending lots of credit card applications may seem like a good idea to get as many offers as possible. Still, it could be harmful to your credit score. Too many applications, even successful ones, can suggest financial trouble. This could damage your credit score, making it harder to get a credit card or another type of loan.

How to check if you’ll be accepted

Several credit card providers offer a quick check online tool to tell you if you will be accepted before you apply. This is a form of soft search that won’t be recorded on your credit file.

The good news is that there are credit cards online designed for customers with less-than-perfect credit. In the longer term, you can also improve and rebuild your credit score. Of course, your credit might already be excellent. Checking your score before applying might simply reassure you that there are no mistakes or surprises on file. 

Applying for a credit card online

What does it mean to apply for a credit card online, and how do you go about it? The online process isn’t too different to how it would be in a branch or over the phone. Applying online allows you to complete the process from the comfort of your own home or from anywhere you have internet access. The online application process can also feel faster and more streamlined than filling out forms by hand or answering questions over the phone.

First, let’s look at what information you may need to make an online application:  

  • Your name, date of birth, and email address

  • Your phone number

  • Your current UK address

  • Previous addresses (if you have moved in the last 3 years)

  • Your annual income

  • Your current bank account number and sort code (this may be required if you’re setting up a direct debit between your existing account and credit card)

You may also need to provide copies of documents to prove your identity. These could include:

  • Your passport or driving licence

  • HMRC documents from the last 21 months

  • Your council rent card or tenancy agreement (depending on your housing status)

  • Other documents such as a bank statement, utility bill, council tax bill, or insurance policy from the last 3 months 

What do credit card companies assess you on when applying online?

Credit card providers assess a range of criteria when making a decision on your application. While this does include a credit check using one of the UK’s credit reference agencies, they also use their own metrics and the information you have provided.

  • Your current outgoings and how much debt you have, like other credit cards, loans, or overdrafts

  • Your employment – in particular, how long you have been in your job and whether it’s permanent or temporary

  • Your current account and how long you’ve had it

  • Your address and how long you’ve lived there

  • Your credit and repayment history 

You should be able to fill out the entire application online and submit copies of any documents the lender requires.

Application processes can vary between credit card providers. Some may send you paperwork to sign and return in the post. You’ll also be given a SECCI pre-contract credit form and a credit agreement to sign. You can sign documents digitally if you apply online. Alongside these forms, you should be provided with a full explanation of both papers, including all the key terms and conditions, so you have a clear understanding of the agreement before proceeding. This is a legal requirement.   

What happens after your online credit card application has been accepted?

If you’re successful and your application is accepted, you could have your credit card within 10 days. What happens next?

  • You will receive your PIN – a four-digit number for making payments; you will still receive a PIN if your new credit card is contactless as the PIN is needed to activate the card and for security checks

  • Your physical credit card will arrive a few days later with instructions on how to activate it

  • You will usually receive details of how to sign up for your credit card provider’s online banking services or app

  • Once activated, you can begin using the card straight away 

Credit card online banking

Once you have a credit card, you should be able to do almost all your banking online. Technology is getting more sophisticated all the time. Almost everything you would previously have done in a branch or over the phone can now be done online. 

The vast majority of credit card providers offer complete online banking services, including checking your balance, viewing and downloading your statements, and making payments. If online banking is an essential feature for you, make sure to check directly with your provider before you apply for a card with them. 

How to pay credit card online

It’s easy to pay your credit card bills online, whether it’s your minimum monthly payment or your balance in full. Financial experts always recommend doing the latter if possible because it has the best impact on your credit rating. 

For more general advice on good practice, check out our guide on using your credit card correctly. To pay online, simply login to your account on your credit card provider’s website or banking app and follow the instructions for making a payment. While this can vary between lenders, they will send out information on how to pay.

If your online credit card application is refused

If your application is declined, it’s essential to understand why. The credit card provider has a legal obligation to tell you if your application was refused because of your credit history. However, they do not have to provide further details. 

If this was the reason, it’s worth taking a closer look at your credit file to understand why and take steps to improve the situation. Either way, you should avoid re-applying straight away, either with the same provider or elsewhere. Multiple applications can become a black mark on your credit history, and numerous rejections are even worse. 

A final note on applying for a credit card online

Applying for a credit card online is quick and convenient. If used responsibly, credit cards can be a flexible way to borrow money with many benefits, from spreading the cost of purchases to transferring balances and building your credit. While the process is similar to applying for a credit card in person, applying online is the fastest and easiest way to get your hands on a credit card.

3 June 2021