A Basic Guide to Supplementary Credit Cards
Get the Best Credit Cards in Singapore
Supplementary credit cards can make a great addition to a principal credit card account. However, there are quite a few risks that come along with the associated benefits. The guide below discusses how and when to effectively use supplementary credit cards.
Table of Contents:
What is a Supplementary Credit Card?
If you currently have your own credit card, chances are you're eligible to apply for an accompanying supplementary credit card. These cards are usually reserved for a family member like a spouse or child. Supplementary cards also typically share the same rewards structure as the principal card, allowing cardholders to boost overall earnings. In addition, supplementary cardholders can enjoy special perks and privileges associated with the principal card.
In general, it's now possible to apply for most supplementary cards online, or by simply mailing in an application form. Primary cardholders may even earn bonus miles or extra cashback for each successful application. Finally, most–but not all–supplementary credit cards are either free or have a very low annual fee, making them an attractive addition to an account.
Examples of Credit Cards with Free Supplementary Cards
| Credit Card | Principal Annual Fee | Supplementary Annual Fee |
|---|---|---|
| HSBC Revolution | S$160.5 | S$0.00 |
| Citi Prestige | S$535 | S$0.00 |
| Citi PremierMiles Card | S$192.60 | S$0.00 |
| SC Unlimited Cashback | S$192.6 | S$0.00 |
How Does a Supplementary Card Actually Work?
Supplementary credit cards are fairly easy to use, but do not work in exactly the same way as a principal card. As mentioned, most supplementary cards share the same rewards structure as the primary card; if the primary offers 5% rebate on dining, so too does the supplementary card. However, transactions on a supplementary credit card are consolidated and reflected in the primary cardholder's statement. Therein, the primary cardholder bears responsibility for all posted purchases and fees.
Rewards earned are also processed differently. The 5% rebate earned from a supplementary cardholder's dining spend, for example, is credited back to the primary cardholder's account. In the case of cashback, the cumulative earnings are usually applied to offset the next month's consolidated bill. With travel cards, however, all miles accrued are directed to the primary cardholder's account, and only he or she can redeem them. The distribution of rewards is a topic worth discussing before agreeing to share a supplementary card with a family member.
Sharing a Supplementary Card with a Spouse or Child
As mentioned, supplementary credit cards are most typically used by a spouse or child. For a spouse, a supplementary card offers an opportunity to boost rewards overall as a couple, while also minimising annual fees. This is especially true for expensive cards, where total fees average out to a more moderate sum between two people.
Supplementary cardholders can also enjoy added perks associated with the primary account, unless otherwise stated. It's still important to review the principal card's terms and conditions as benefits like free airport lounge visits may not carry over in an equivalent way.
Selection of Luxury Supplementary Credit Cards
| Credit Card |
|
|
| Shared Perks |
|---|---|---|---|---|
| SC Visa Infinite | S$588.5 | S$0.0 | S$294.25 |
|
| Citi Prestige | S$535.0 | S$0.0 | S$267.50 |
|
| UOB PRVI Miles Amex | S$256.8 | S$0.0 | S$128.40 | Free limo transfers |
While sharing a supplementary card with a spouse is a great way to quickly earn rewards without extra fees or maintenance, sharing such a card with a child deals more with supporting their development. Supplementary cardholders typically must be at least 16 to 18 years old, and their spend is reported in the principal cardholder's monthly statement.
Sometimes, principal cardholders can set a separate credit limit for supplementary cardholders, which minimises overall risk. However, it's essential to keep a close eye on monthly statements and remain engaged with a child's spending behaviour. Ultimately, the principal cardholder is accountable for all transactions made on the account.
Benefits and Drawbacks of a Supplementary Card
Overall, supplementary credit cards come with both benefits and drawbacks.
| Pros | Cons |
|---|---|
| Spend on supplementary card counts towards primary cardholder's min spend | Principal cardholder responsible for paying off supplementary card charges |
| Double spending powers boosts overall earnings | Shared card limit means primary cardholder spending limit is decreased |
| Lower or no annual fee for supplementary cards | Principal cardholder's credit score could be adversely affected |
Overall, the best scenario for using a supplementary card is when the primary card is expensive and does not have a rewards cap (typically, miles-earning and unlimited cashback cards). It's important to only share supplementary cards with trusted individuals who have shown themselves to be financially responsible.