PhD students looking for credit cards baffle banks

Nailer99

I’m surprised to hear this. Admittedly it is 20-years since my PhD but when I was a PhD student I had no problem at all applying for credit cards. I always entered my stipend as “salary” on the forms and this was never questioned. 

Nailer99

It is worth a search of this forum as this question has come up many times before and you’ll find some helpful advice and reassurance. 

https://www.google.co.uk/search?q=credit+card+phd+student+site:forums.moneysavingexpert.com&client=safari&hl=en-gb&prmd=insv&sa=X&ved=2ahUKEwiq_duF4rL5AhXUSsAKHci1DhQQrQIoBHoECEIQBQ&biw=375&bih=749&dpr=3

callum9999

WillPS said:

It used to be the case that pretty much every bank which offered a student current also offered a student credit card, but it now seems TSB is the only one:
Student Credit Card | Credit Card | TSB Bank

If I were you, I'd get a TSB Student Account open and then apply for one toward the end of the year. If accepted, this would have the advantage of being a 'prime' lender on your credit file.

I was under the impression that lenders cannot see who your other lenders are? They can possibly guess whether it's prime or subprime from the limit (though I've had numerous prime cards with £500-£1000 limits and sub prime with higher than that), but I'm not exactly sure why they'd care? 

Not least because the other lenders based their decision on the same data they're seeing. If they can't trust their own analysis and rely on whether other reputable banks like you or not, I'm not sure they should be in the money-lending business!

JIL

Chino said:

JIL said:

and a PhD should lead to a future higher income, just the type of customers that finance sectors would want to encourage.

Being an expert in some obscure field of knowledge that no one else cares about might not make a candidate as attractive to potential employers as you might expect.

Do you mean employers or do you mean banks? Because I thought it was about a credit card, from a financial institution.
 I'm sure certain employers would want so called experts.

Someone else must care otherwise there would be no one to undertake the viva. 

ab1234567890abcdefgh

JIL said:

AmberDepp said:

Jacob271995 said:

For quite a while now I have been on the hunt for a credit card simply for the purposes of improving my credit score and extra security. I am a PhD student at the University of Manchester and I have been unsure how this might affect my eligibility for a credit card. Well, after a very interesing interaction with Santander today I have been told that it would be best to wait until I have finished my PhD before further pursuing a credit card. I specifically went for an appointment with my local branch to apply for a credit card. The person who held the appointment said I meet all of the criteria (which all online eligbility questionaires aslo agree with), however the application was quickly declined. Following an appeal I finally got a defnitive answer explaining their reasoning. Basically, the non-taxable stipend that PhD students are paid completley baffles banks and places PhD students firmly in a gray area. For instance, I got told that in the eyes of Santander I am unemployed due to this. This is not a fault on the bank or any staff but it is an unfortunate situation. I think more communication between academic/government institutions (e.g. I am funded by the BBSRC) and banks is needed to illuminate this gray area and allow banks to make more informed decisions on providing PhD students with credit cards. 

If you are a PhD student please let me know if you have had any luck in getting a credit card anywhere else? 

I going to give getting a credit card a rest until the end of my PhD but any other advice regarding this situation is welcome. 

All the best, 
Jacob

Your "income" is below NMW which is why they won't touch you with a bargepole.

How do you work that out?

As I understand it the grant is £15,000 to £18,000 per year. No tax is payable. So a net income of up to £1500 per month. 

It's not repayable and a PhD should lead to a future higher income, just the type of customers that finance sectors would want to encourage. 

Not really the point.

The OP isn't applying for student cards so is subject to the same criteria as us mere mortals.

As standard cards don't really take into account the source of funds, for the most part, putting a below NMW "salary limit is going to result in an instant decline.

Blame the idiots who were beating the banks over the head with a stick for "irresponsible" lending.

cymruchris

ab1234567890abcdefgh said:

JIL said:

AmberDepp said:

Jacob271995 said:

For quite a while now I have been on the hunt for a credit card simply for the purposes of improving my credit score and extra security. I am a PhD student at the University of Manchester and I have been unsure how this might affect my eligibility for a credit card. Well, after a very interesing interaction with Santander today I have been told that it would be best to wait until I have finished my PhD before further pursuing a credit card. I specifically went for an appointment with my local branch to apply for a credit card. The person who held the appointment said I meet all of the criteria (which all online eligbility questionaires aslo agree with), however the application was quickly declined. Following an appeal I finally got a defnitive answer explaining their reasoning. Basically, the non-taxable stipend that PhD students are paid completley baffles banks and places PhD students firmly in a gray area. For instance, I got told that in the eyes of Santander I am unemployed due to this. This is not a fault on the bank or any staff but it is an unfortunate situation. I think more communication between academic/government institutions (e.g. I am funded by the BBSRC) and banks is needed to illuminate this gray area and allow banks to make more informed decisions on providing PhD students with credit cards. 

If you are a PhD student please let me know if you have had any luck in getting a credit card anywhere else? 

I going to give getting a credit card a rest until the end of my PhD but any other advice regarding this situation is welcome. 

All the best, 
Jacob

Your "income" is below NMW which is why they won't touch you with a bargepole.

How do you work that out?

As I understand it the grant is £15,000 to £18,000 per year. No tax is payable. So a net income of up to £1500 per month. 

It's not repayable and a PhD should lead to a future higher income, just the type of customers that finance sectors would want to encourage. 

Not really the point.

The OP isn't applying for student cards so is subject to the same criteria as us mere mortals.

As standard cards don't really take into account the source of funds, for the most part, putting a below NMW "salary limit is going to result in an instant decline.

Blame the idiots who were beating the banks over the head with a stick for "irresponsible" lending.

National minimum wagę for 18-20 year olds (who are old enough to get a credit card) is £6.83 an hour this year - that's £13762 p.a. and there'll be plenty of 18-20 year olds on those salaries that will have gotten a credit builder card such as Capital One/Aqua or Vanquis, or even mainstream cards such as M&S or HSBC.

There also those that have part time jobs where the income is way above national minimum wage in terms of the hourly rate, but the annual income lower as less hours are worked. There plenty of these people that work these part time hours that have also got credit cards.

So saying that putting in an annual salary that equates to below national minimum wage for the most part leads to an 'instant decline' just isn't true. Potentially there are quite a lot of people that earn below £19142 a year (This year's full national living wage on a full-time basis) that have taken out credit cards, and in fact many of these credit cards state what the minimum income should be - and it's often way below this figure.

Here's a couple of examples of acceptance criteria for an HSBC regular credit card and an M&S credit card:

WillPS

cymruchris said:

Would the HSBC Student credit card with a modest £500 limit be useful? The only requirements appear to be being over 18 and a UK resident with a HSBC student account. Might be worth opening the student current account to get the credit card?

https://www.hsbc.co.uk/credit-cards/products/student/

Ooo I didn't realise HSBC's Student Credit Card was still available too - same deal as TSB it seems more or less. TSB want you to have had the TSB Student Account for 3 months whereas HSBC don't set a minimum, however do be aware that HSBC take forever to process account applications so it could well be a very long wait getting both applications accepted (unless you can find a helpful branch who will do both at once?).

WillPS

Chino said:

JIL said:

and a PhD should lead to a future higher income, just the type of customers that finance sectors would want to encourage.

Being an expert in some obscure field of knowledge that no one else cares about might not make a candidate as attractive to potential employers as you might expect.

Chip on your shoulder, sir?

[Deleted User]

Jacob271995 said:

[Deleted User] said:

Jacob271995 said:

I going to give getting a credit card a rest until the end of my PhD but any other advice regarding this situation is welcome. 

You'll be best suited to looking at a sub prime provider, where the risk is more carefully managed. The limit will be low and the APR high, but that doesn't matter because you'll clear in full every month.

Remember also that you're not looking to improve your credit score, but to build some good credit history.  Don't confuse the two of you'll be tempted to make poor decisions.

Yes, I should have been more clear. My credit score is pretty good but I need to build up a credit history. I am registered to vote, pay off my phone contract, and in my flat my name is on the bills, so hopefully it won't sting me too much in the future. However, I am a bit worried as I might be in a position to start looking at the housing market at the end of my PhD (due to my lifetime ISA) and my lack of credit history might limit my options. I guess I will cross that bridge when we get to it. 

No lender ever sees the gimmick score, they all use their own scoring systems that you will never see

WillPS said:

It used to be the case that pretty much every bank which offered a student current also offered a student credit card, but it now seems TSB is the only one:
Student Credit Card | Credit Card | TSB Bank

If I were you, I'd get a TSB Student Account open and then apply for one toward the end of the year. If accepted, this would have the advantage of being a 'prime' lender on your credit file.

Lenders do not see who your card is with, so prime or sub-prime, only the data counts

Jacob271995

Chino said:

JIL said:

and a PhD should lead to a future higher income, just the type of customers that finance sectors would want to encourage.

Being an expert in some obscure field of knowledge that no one else cares about might not make a candidate as attractive to potential employers as you might expect.

Unfortunatley, the subject of my PhD is very relevant at the moment. I wish it wasn't but it gives me good job oppertunities after.