CommBank launches new Essentials Credit Card - how does it stack up?
Friday 23 March 2018
The Commonwealth Bank has today launched a brand new credit card option, the CommBank Essentials Credit Card, and at the same time axed three of its other credit card options.
CBA has “streamlined” its credit card lineup by removing the Student credit card, Gold Awards credit card and Business Gold Awards credit card, replacing them with one low rate option.
The new Essentials Credit Card comes with a low 9.90% interest rate, a $60 annual fee which is discounted to $24 if you sign up for CommBank’s auto payment plan (charged monthly).
“Most banks offer some kind of automatic payment feature, but CommBank are encouraging cardholders to make use of it with this fee structure,” said Mozo Data Manager Peter Marshall.
Although this feature can be very handy - and save you money in this case - Marshall had a word of caution for cardholders.
“Setting the automatic payments at the minimum monthly repayment can be a trap, because you really should be trying to pay your entire balance off each and every month, in order to avoid interest all together,” he said.
The CBA Essentials Card also has a low $3,000 credit limit and is designed specifically to be used at the checkout, because unlike most credit card options, cardholders aren’t able to access cash advances.
“For spenders who are tempted by visiting an ATM with their credit card and wind up paying extra fees or higher interest for doing so, using this card could help curb that habit,” said Marshall.
But how does CommBank’s new Essentials Credit Card stand up to other Lite cards in the market today? We took a look at our database to compare.
Lite credit card options
|Credit Card||Interest rate||Annual fee|
|Community First Credit Union McGrath Pink Visa||8.99%||$40.00|
|Easy Street Easy Low Rate Visa Credit Card||8.99%||$40.00|
|Bank Australia Low Rate Visa||9.39%||$59.00|
|G&C Mutual Bank Low Rate Visa Credit Card||9.49%||$50.00|
|Commonwealth Bank Essentials Credit Card||9.90%||$60 ($24 if you sign up for AutoPay)|
|Westpac Lite Card||9.90%||$108|
|Bank of us Visa Credit Card||9.99%||$39.00|
|Bank First Visa Platinum Credit Card||9.99%||$99.00|
On paper, the CommBank Essentials Credit Card comes in with a competitive interest rate and annual fee, particularly if you sign up to AutoPay, but Marshall cautioned borrowers to consider the way they use their card and their personal needs before diving in.
“If you faithfully pay off your balance each month to avoid interest, then the $24 annual fee makes this card one of the more attractive Lite options around,” he said.
“But, the $3,000 credit limit suggests this card is aimed at lower income cardholders, who are generally more likely to wind up carrying a balance from month to month, and will pay interest on their spending.”
So if you’re the kind of cardholder who tends to carry a balance, its worth considering your other spending options, such as a debit card, which allows you to avoid paying interest. You can also head over to our credit card comparison tool to find a piece of plastic that suits your needs to a tee.