How do credit cards work?

Who can apply for a credit card?

To apply for a NAB credit card, you must be:

The following Visa categories are not acceptable:

How to apply for a credit card

You can apply for a NAB credit card either online or at a NAB branch. To complete your application, you’ll need to have some of your documents and information ready. You’ll also be asked to set a limit for the amount of credit you want.

Learn more about what you need to have ready to apply.

If your application is approved, it’s then subject to verification. If you meet the verification criteria, you’ll receive your credit card in the mail within five working days. Once you activate it, you can start using it straight away.

How does a credit card work?

Your credit limit

Your credit limit is the amount you can borrow. When you apply for a credit card you can either set your own credit limit or the bank will set the maximum credit amount, based on the information you supplied about your financial situation. The bank will also set a minimum card limit, which depends on the type of card you apply for.

Interest rates

When you apply for a credit card you’ll be told which interest rate applies. This is an annual percentage that you pay, and it applies to any outstanding amount not paid off by the required due date. The amount of interest you’ll pay will differ each month. It’s determined by how much you spend, how much you repay, and when you repay it. For example if the interest rate is 18% per annum, and you have $100 outstanding on your balance, you will be charged 18% per annum of $100, or approximately $1.50 per month.

Interest-free periods

Most credit cards have ‘up-to-44 days’ or ‘up-to-55 days’ interest-free periods on purchases.  This means interest on amounts you owe doesn’t start to build up until the statement due date.

Interest-free periods usually start on the first day of your billing cycle, not when you make a purchase. For example, if your credit card has an interest free period of 44 days, this means you have 44 days from the day of your statement to pay the closing balance in full, or if your statement displays an interest free days payment, this amount in full. After this, you will be charged interest.

Note: Interest rates and interest-free periods don’t apply to a NAB StraightUp Card.

Repayments

Once you have a credit card, like any debt, you need to pay it back. Your bank will send you statements each month which will show you the total amount you have borrowed, any payments you have made, the interest rate, any interest or charges that have accrued, as well as the minimum amount you have to pay.

To avoid paying interest, make sure you pay the closing balance in full by the due date each month. If you don’t pay the full amount of the closing balance, you will need to pay at least the minimum payment amount shown on your statement. If this amount isn’t paid by the due date, you may have to pay late fees or missed payment fees, as well as interest.

Balance transfer

A balance transfer is a way to move some or all of what you owe (your balance) on one or more credit cards to a new one. The debt you move to the new card usually has a much lower interest rate (or often no interest) than what you were previously paying, for a period of time. This is known as a promotion period and it’s usually between six months and three years. After this period, any unpaid balance transfers will attract the standard cash advance rate. 

Annual fees

Most credit cards have an annual fee, which is payable every 12 months. The annual fee will be charged within the first statement period (generally 30 days) of your card opening and after you’ve made your first purchase. Depending on which card you choose, you may pay a lower annual fee with one credit card when compared to another.

Monthly fees

The NAB StraightUp Card has a monthly credit card fee, rather than an annual fee. The amount of the monthly fee will depend on your credit limit.

Late payment fees

Most credit cards will charge a fee if your payment is late or missed. Learn more about how to avoid late payment fees.

Types of credit cards

We have several different types of credit cards at NAB, each with its own features and benefits to suit your needs.

If you’re not sure which credit card would be right for you, our easy to use tool will help find the best card for your needs. You can also compare some of the cards that you’re most interested in instead.

No interest credit card

The NAB StraightUp Card is a simple and easy to understand credit card that comes with no interest. Instead of an annual fee, the card has a fixed monthly fee which is decided based on the credit limit you choose. The NAB StraightUp Card features no use, no pay – which means if you don't make any purchases and have an outstanding balance of $0 during the whole statement period, we'll reverse your monthly fee. You’ll also benefit from no other charges, including no late payment fees and no foreign currency fees.

This card however doesn’t allow things such as balance transfers, insurances, or additional cardholders.

Low interest rate credit card

The NAB Low Rate Card offers the lowest interest rate on purchases. Unlike the NAB StraightUp Card, this card allows you to add an additional cardholder at no extra cost, and take advantage of special movie and event offers from Visa Entertainment. 

Low annual fee credit cards

We have two low fee credit cards, each with a different minimum credit limit. These cards have the lowest annual fees and depending on the card you choose, may have complimentary insurances.

They do however have higher interest rates compared to our NAB Low Rate Card.

Rewards credit cards

If you’re interested in earning rewards points, there’s two different rewards programs you can choose from. Both programs have two different cards, with a different minimum credit limit to meet your needs. They both also come with complimentary insurances.

NAB Rewards credit cards

With a NAB Rewards card you can earn an unlimited amount of NAB Rewards Points when you make purchases using your credit card. In the NAB Rewards store, you’ll be able to redeem them for a range of products, gift cards, and flights, as well as transfer your points to cash or points with some of our travel partners.

NAB Qantas Rewards credit cards

Our NAB Qantas Rewards cards allow you to earn Qantas Frequent Flyer Points  when you use your card to make purchases. You can use your points for flights, products, and vouchers from the Qantas store. If you’re not already a Qantas Frequent Flyer member, you’ll be able to join for free when you apply.