A credit card can be an effective tool for making purchases, simplifying your finances and even smoothing out your cash flow. But before signing up to one, it’s a good idea to get familiar with just how they work.

Types of cards

There are three main types of CommBank credit cards. Depending on your situation, one may suit you more than the others.

Low Fee: These tend to be suited to those who are wanting a credit card for the convenience and are confident they’ll be able to pay back their balance in full each month. They attract a higher rate of interest than some other card types.

Low Rate: Low-rate credit cards typically have a lower purchase interest rate than some other cards. These cards are suited to those who expect they’ll carry over a balance from month to month rather than paying it off in full, and would like to minimise the interest they’ll pay on this balance. They have a higher annual fee than some of our other card types.

Awards: Awards cards allow you to earn awards points as you spend. You can spend these points on travel, gifts and even get cash back. They have a higher annual fee and interest rate than some of our other card types.


Credit cards require you to make repayments each month while there is an amount owing. You can choose to make the minimum payment as shown on your statement, or pay your balance in full. You can also pay off an amount somewhere in between those two amounts. Keep in mind that the more you pay off, the less interest you’ll pay.

Balance transfers and cash advances

Credit cards have other benefits in addition to enabling you to make purchases. A balance transfer allows you to transfer a balance from an existing card with another issuer onto a new credit card. With a new card you’ll typically be offered an introductory period with a low-interest rate, which can help you save interest. When the introductory balance transfer rate finishes, the outstanding balance (including any related interest) will be treated as a cash advance.

You can also withdraw money from your credit card; this is known as a cash advance.1 You’ll be charged a fee for cash advances as well as interest at the cash advance rate on the amount you withdraw.


Credit cards have a number of fees associated with them, including annual fees, cash advance fees, late payment fees and international transaction fees. Before taking out any card, make sure you’re across all of these fees that may apply and have budgeted for any you may incur.

Credit card benefits

A credit card provides access to funds up to a certain limit, so long as you make the minimum payment by the due date each month.

Credit cards let you carry less cash and buy things over the phone or online, and can be useful if, for example, you have to make a purchase before payday.

Credit card trade-offs

If you don’t repay your balance in full every month you will be charged interest in addition to any fees that may apply. While it can be convenient to use a credit card, it is money that you will have to repay and it’s important to keep this in mind.

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Things you should know

This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. You should consider seeking independent financial advice before making any decision based on this information. Applications for credit cards are subject to approval. Full terms and conditions will be in our Letter of Offer. Fees and charges apply.

Cash advances are blocked on CommBank Essentials credit cards (exceptions apply). We’re unable to block cash advance transactions that aren’t sent to us for authorisation. These will attract interest from the date the transaction is made until it’s repaid.