Student Credit Cards of 2017

Taking out a credit card while you're a student is an opportunity to start building your credit history and developing your credit score. Later in life, a solid credit history may be invaluable to the success of your flat or house rental applications, loan and mortgage applications and even job applications. Regardless of which card you choose, be sure to always pay at least the minimum monthly payment on time and stay within the credit limit.

Student Credit Cards

In our analysis we have considered annual fees, foreign transaction fees, interest rates, rewards and eligibility criteria (e.g., credit history, income level, etc.). Below are some credit cards that will consider students with limited credit history and income. The most suitable card for you will depend on your individual financial situation. There may be other cards that we do not mention here that have better features for you.

Student Credit Cards with No Job

You generally have two options when it comes to finding a student credit card with no income. Either go for a credit card that is linked to a high-street bank current account (e.g., HSBC, RBS, NatWest, etc.) or apply for a card that does not require you to open a bank account but may charge a higher interest rate. Cards linked to current accounts will generally sport a lower interest rate, but you must already have or apply to open a student account with the bank first in order to get a credit card.

No Income: HSBC Student Credit Card

The HSBC Student Credit Card is available to most students, provided you have (or open) a HSBC student current account. There is no income requirement (the balance in your current account shows you have the means to pay your bills) nor a minimum credit history to be accepted. You only need to be a UK resident and 18 (like all other cards mentioned on this page) and be a student. Credit limits are modest, up to £500.

Specifically, the HSBC student requirement, from their website, is: "studying, or intending to study, a qualifying undergraduate course of two years or more at a UK, Channel Islands or Isle of Man university/college or a part-time course with a Disability Student Allowance." When applying for the card you need to provide proof of your acceptance e.g. UCAS letter or letter from the university/college.

Summary

  • Must have HSBC student current account
  • No income requirement
  • 18.9% variable APR
  • Credit-building card with high-street bank
  • No annual fee

No Income: NatWest Student Credit Card

The NatWest Student Credit Card, like the other high-street bank student credit cards, is linked to a NatWest student current account. While we recommend paying down your full balance every month in order to avoid paying interest charges altogether, at the very least you should pay your monthly minimum payment on time. That, along with staying within your credit limit, will help to establish a good credit history. In order to apply you must be a UK resident, 18+ and have a NatWest student current account. The maximum credit limit is £500.

Summary

  • Must have NatWest student current account
  • 18.9% variable APR
  • Credit-building card with high-street bank
  • No annual fee

No Income: RBS Student Credit Card

The RBS Student Credit Card is another option for students with no income to start building up a credit history. To apply you need to be over 18, a UK resident and hold a Royal Bank of Scotland Student Current Account. The balance in your student current account gives the bank comfort that you can pay your bills, even if you don't have an income.

The maximum credit limit of £500 will prevent a large debt from racking up while you demonstrate responsible card management. While at a minimum you should stay within your credit limit and pay your monthly minimum payment, we recommend paying down your full balance every month to avoid paying any interest charges.

Summary

  • Must have RBS student current account
  • 18.9% variable APR
  • Credit-building card with high-street bank
  • No annual fee

No Income: Capital One Classic

The Capital One Classic will consider students who currently have no job, as there is no strict income requirement. You do, however, need some credit history in the UK, perhaps in the form of a current account in which you've set up direct debits to pay for a mobile phone, gas or electric bill. The card is targeted at those with bad credit or building credit, and proper use can help you establish a good payment history.

It is crucial to pay your monthly minimum payments on time and staying within your credit limit. Do so and you may be eligible to receive two optional credit limit increases a year, which may improve your credit rating. As a credit-builder card, the APR is higher than average. Therefore, try to pay your entire balance every month (beyond just your minimum payment) to help you avoid interest charges.

Before applying, you can check your odds of being accepted using Capital One's eligibility checker, QuickCheck, which won't harm your credit score.

Summary

  • No income requirement
  • Need some credit history in UK
  • Credit-building card
  • No annual fee
  • Two possible credit limit increases per year
  • 34.9% variable APR
  • QuickCheck eligibility checker

First Student Credit Cards for No Credit History

The HSBC Student Credit Card, the RBS Student Credit Card and the NatWest Student Credit Card, discussed above, all require an associated student current account at the respective bank in order to apply. The following starter credit cards do not require an associated student current account.

First Student Credit Card: Aqua Start Credit Card

The Aqua Start Credit Card is Aqua's entry-level card, with the least stringent income and credit history requirements. Initial credit limits are low, between £100 and £300, until you prove your ability to pay back your debts. Accounts are reviewed every four to six months and - if you have stayed within your credit limit and made your monthly minimum payments on time - your credit limit is likely to increase in future. If you have the means, pay down your full balance each and every month. That way, you avoid paying any interest charges, which could be substantial since the interest rate is higher than average on this starter card.

Summary

  • Possible first student credit card (applications with no credit history are considered)
  • Low initial credit limit
  • Potential to increase credit limit
  • No annual fee
  • 49.94% or 59.95% or 69.95% variable APR

First Student Credit Card: Marbles

The Marbles Card is another option for students looking for their first credit card. If you have no credit history in the UK, with this card you can demonstrate your ability to handle credit responsibly. This card does charge a higher-than-average interest rate, unsurprisingly, but as long as you pay down the full balance every month you won't have any interest charges anyway. Like all credit-builder cards, be sure to pay at least the monthly minimum payment on time and stay within your credit limit. The minimum credit limit on the Marbles card is £250. Your credit limit is reviewed after 3 months (i.e., you could get a credit limit increase on your 4th statement).

Marbles offers a "soft" eligibility checker which has no impact on your credit rating: FastCheck shows your chances of being accepted before you apply. Another card feature is the ability to choose a monthly repayment date that suits you, perhaps just after pay day or to coincide with other bills.

Summary

  • Possible first student credit card (no credit history needed)
  • Soft eligibility check tells you odds of being accepted
  • No annual fee
  • Chance to increase credit limit after three months
  • 33.8% variable APR

First Student Credit Card: Vanquis Credit Builder Card

The Vanquis Credit Builder card will consider students with no credit history, for a first credit card. As a starter cards, the initial credit limit will be lower than average, between £150 and £1000. Stay within your credit limit and pay your monthly minimum payment on time, and you may be eligible for credit limit increases. This "good behaviour" may also help to improve your credit rating, as it shows responsible card management.

As interest rates are higher than average on cards for those with no credit history, it is wise to fully pay down your balance every month. This way you can avoid potentially large interest charges. Use Vanquis's Express Check eligibility checker to see your odds of being accepted before you apply.

Summary

  • Potential first student credit card (applications with no credit history are considered)
  • Low initial credit limit
  • Possible credit limit increases
  • No annual fee
  • 39.9% variable APR
  • Express Check eligibility checker

Student Credit Cards for Part-Time Jobs: Barclaycard Initial

The Barclaycard Initial Credit Card is designed for those with limited to no credit history (hence the name), BUT you must have a recommended income of £3,000 per year. Customer service told us that proof of your first month's paycheck from a part-time job may be enough to be accepted. Besides being employed, you should have lived at your current address for at least three months. On the Initial you will pay no interest on purchases in the first three months. By staying within your credit limit and making your minimum payments on time, your interest rate (which starts at 34.9% variable) should reduce by up to 5% over two years. Barclaycard also offers a free pre-application eligibility check that won't adversely affect your credit rating.

Summary

  • Need income from part-time employment
  • 0% on purchases first three months
  • No annual fee
  • Chance to reduce interest rate by 5% over two years
  • 34.9% variable APR
  • Pre-application eligibility check

Credit Cards for Students Traveling Abroad

Aqua offers two credit cards that charge no FX fees for use while travelling: the Aqua Advance and Aqua Rewards will not hit you with non-sterling fees when you make purchases abroad. Withdrawing cash is another matter. Be aware that will you pay a 3% cash withdrawal fee (£3 minimum) and interest will start accruing immediately at a high rate, minimum 39.9%. If you do find yourself desperate for cash while traveling, get online and pay back the balance ASAP after you've taken your cash. One important tip: always opt to pay in the local currency and let MasterCard manage the exchange rate for you instead of the retailer.

Student Travel Card: Aqua Advance

The Aqua Advance charges no fees on foreign transactions. While the Aqua advance interest rate on purchases starts off high (34.9% variable APR), by staying within your credit limit and paying at least the minimum payment on time each month, your interest rate will drop by 5% a year for three years. After three years of "good behaviour" your interest rate can be 19.9%. That said, we recommend paying not just your minimum payment but the full balance every month, so that you avoid interest charges altogether.

Summary

  • No foreign transaction fees
  • 3% cash withdrawal fee (£3 minimum)
  • Interest rate reduces by 5% a year for "good behavior"
  • No annual fee
  • 34.95% variable purchases APR (or 44.93%, 49.91%, 54.95% or 59.95%)

Student Travel Card: Aqua Rewards

The Aqua Rewards Credit Card charges no foreign transaction fees and delivers cashback rewards. Cardholders are rewarded with 0.5% cashback on all purchases. Your cashback rewards are paid out once a year, so long as you have not been late paying at least the minimum payment each month and your account stays under the credit limit. While rewards are capped at £100 each year, we don't expect most cardholders will find this restricting – you'd have to spend £20,000 a year on the card to earn £100 in cashback.

The credit card carries a higher-than-average interest rate on purchases of 34.95% variable APR. This won't matter if you pay off your full balance every month. Paying down your full balance on time every month is crucial not only to avoid interest charges but also to build up your payment history, which in turn affects your credit score.

Summary

  • Earn 0.5% cashback on your purchases
  • 3% cash withdrawal fee (£3 minimum)
  • No foreign transaction fees
  • No annual fee
  • 34.95% variable purchases APR ( or 44.93%, 49.91%, 54.95% or 59.95%)

Summary of 2017's Student Credit Cards

Below is a summary of student card across different categories.

For...CardQuick Overview
No JobHSBC Student CardMust have HSBC student current account; lower-than-average student interest rate
No JobNatWest Student CardMust have NatWest student current account; lower-than-average student interest rate
No JobRBS Student CardMust have RBS student current account; lower-than-average student interest rate
No JobCapital One ClassicHigher interest rate; Must have some credit history in UK; QuickCheck eligibility check
No Credit HistoryAqua StartGood first credit card as no credit history requirement
No Credit HistoryMarblesGood first credit card as no credit history requirement; FastCheck eligibility check
No Credit HistoryVanquis Credit BuilderGood first credit card as no credit history requirement
Part-Time JobBarclaycard InitialInterest rate may drop by 5%; Must show income of £3,000; Eligibility check
TravelAqua AdvanceNo foreign transaction fees when used abroad; Interest rate may drop
Rewards & TravelAqua Rewards0.5% cashback on purchases; No foreign transaction fees when used abroad

How to Choose a Student Card for You

There are student credit cards for all kinds of situations: new to credit, building credit, poor credit, part-time income, no income, etc. Finding the right student credit card for you can be easy if you consider a few defining features of your financial situation:

  • Do you have an income (even a part-time job paying £2,000 - £3,000 a year)?
  • Is this your first credit card or do you have a healthy credit history already?
  • Are you looking for a simple credit-building card or do you want perks (e.g., no foreign transaction fees, cashback rewards)?

You have a few options when it comes to finding a student credit card with no income: either a credit card that is linked to a current account (e.g., HSBC, RBS, NatWest, etc.) or a card that charges a higher-than-average interest rate. Where possible, use an eligibility check to tell you your odds of being accepted before you apply.

Only those with a bit of responsible payment history and a solid credit score are likely to be accepted for credit cards with perks, like cashback rewards (e.g., Aqua Rewards) and no foreign transaction fees (e.g., Aqua Rewards and Aqua Advance). If you're applying for your first credit card, you may be limited to a simple, no frills card that will enable you to build up a history of staying within your credit limit and paying on time. Once you've established a healthy credit history, you can think about upgrading for a card with perks.

You'll notice that a feature of the cards suitable for students is a relatively low credit limit. A key component of your future credit rating is staying within this credit limit so be sure you're aware of it. Cards open to applicants with no credit history are likely to have lower initial credit limits. Most cards offer a "soft" eligibility checker that will tell you if you're likely to be accepted or not. If you're unsure if you satisfy the credit history requirements (which can be a bit vague), this is a useful step in the application process.

How to Improve Credit History

Students applying for their first credit card face a challenge if they don't have much credit history. While there are credit cards that accept students with no to limited payment history, taking steps to build up your credit rating will improve your eligibility to a wider selection of cards. There are ways to start building up a credit history, even without a credit card. The Money Advice Service suggests:

Ways to Build Your Credit History
Open and Manage a Bank AccountKeep enough money in your current account to cover any payments; An interest-free overdraft is an alternative to a credit card
Set Up Direct DebitsSet up regular direct debits to pay gas, electricity, or mobile phone bills
Pay All Bills On TimeMissed or late payments will negatively affect your credit score