What are supplementary credit cards and how do they work?

Supplementary credit cards allow credit card account holders to share credit card benefits and perks with family members, most commonly their spouse or children. They are also a means to gain additional credit, raising the total credit limit.  

This type of credit card is linked to a primary credit card, and typically shares the same reward structure. 

They also allow the supplementary cardmember to enjoy some or all of the same perks and privileges as the primary cardmember, although the degree to which this applies varies somewhat between providers. 

What are the advantages of using supplementary credit cards?

• Earn rewards faster

Credit cards accrue rewards as you use them, so the more qualifying transactions you make, the faster you will earn your rewards. 

Typically, supplementary cards have their transactions combined with the primary card’s, boosting the value of qualifying transactions. In this way, supplementary cards can help you earn more rewards at a faster rate. 

• Reduce annual fees

It is customary for at least the first supplementary credit card to be issued free of charge. 

Therefore, instead of applying (and paying for) two primary credit cards of the same type, households may switch one primary card to a supplementary card with no fees instead. 

Doing so will result in a reduction of their total annual fees. 

• As an emergency fund

A supplementary credit card may also be kept as a source of emergency money, to be used when funds are required on short notice. 

For example, supplementary cards may be given to children studying overseas to cope with temporary fund shortages, instead of having to call home whenever they run out of money. Look out for a fraud protection feature, in which you can monitor dispute suspicious charges.

• To teach financial concepts

Credit cards don’t work exactly the same way as money does, making it an ideal tool to teach children important financial concepts.

For example, they can be taught the financial concept of credit and debt, which goads them to manage their finances effectively instead of turning to borrowing whenever they run out of cash. 

As supplementary cards have adjustable credit limits, you can use them to teach children how to set and manage budgets. 

• To pay for necessary services 

Supplying your children with a supplementary card can help them access important services. They can use their supplementary cards to pay for online food delivery, or to book ride-hailing services to get to where they need to go safely. 

Providing the means to pay for their own food and transport can be helpful in weaning coming-of-age children from relying too much on their parents or helpers, and encourage them towards independence.

ALSO READ: Should you share your credit card account with your partner?

What are the downsides of using supplementary credit cards? 

• Risk of overspending 

It is important to bear in mind that the primary credit card account holder is ultimately liable for the entire credit card balance, regardless of whether the charges were racked up via supplementary cards or not. 

Therefore, if your spouse or children fail to exercise financial prudence, they run the risk of racking up a huge bill, which you’ll be on the hook for. 

If the supplementary cards and the main card have a shared credit limit, careless spending can also exhaust the credit card limit, which could cause bills and other financial obligations to go unpaid. You may even have to fork out extra for admin fees and late fees to rectify the situation. 

To help prevent this from happening, it is important to set a credit limit on each supplementary card. Any request to increase this limit must be reviewed by the primary cardmember. 

• Rewards earned funneled to primary cardmember

Cashback earned is applied to the main account’s statement balance, while air miles and rewards points are awarded to the main cardmember. 

Since they helped to earn these rewards, the supplementary cardmembers may then feel justified in asking for a share of the rewards. However, dividing them up in a fair and equitable manner may be difficult or troublesome. 

• No increase in rewards due to caps

Some types of rewards, such as cashback, are capped at a fixed amount, and do not increase with the addition of supplementary cards. 

If the primary cardmember is already reaching the rewards cap, there’s not much to be gained from adding on supplementary cards, unless they are air miles cards or unlimited cashback cards.

6 popular supplementary credit cards to get

Standard Chartered Unlimited Cashback Card

The SCB Unlimited Cashback Card gives you 1.5 per cent cashback on all your spends, so the more transactions you charge to it, the more savings you’ll get. 

Which is why this makes a great supplementary card for your family members. Put a copy into the hands of your spouse and children – easy to do as annual fees are waived for up to five supplementary cards – and watch the savings rack up.

SingSaver Exclusive Promotion: Score a set of Apple AirPods Pro (worth $379) or $300 cash via PayNow when you apply for the Standard Chartered Unlimited or Standard Chartered Rewards+ credit card!

To be eligible for this promotion, you’ll have to be a new Standard Chartered Bank cardholder and activate your new card within the first 30 days of card approval. Also, a min. spend of $200 is required. If you already have a Standard Chartered credit card, you’ll be rewarded with $30 cash via PayNow when you sign up. Promotion is valid till Febm5, 2021, T&Cs apply.

UOB PRVI Miles American Express Card

The UOB PRVI Miles credit cards are known for their industry-leading local spend earn rate of 1.4 miles per dollar, but it’s the American Express variant that makes having supplementary cards rewarding. 

You’ll be awarded 20,000 air miles if you charge more than $50,000 in a year. If you struggle to reach that limit yourself, get some supplementary cards and have your family to help you. 

This reward encourages having more supplementary cards than less. However, do note that only annual fees for the first two supplementary cards are waived. 

ALSO READ: Should you give your girlfriend a supplementary credit card?

UOB One Card

The rebate structure may take some working out, but the gist is this: Spend at least $2,000 per month for three months, and it will let you earn the maximum cashback (equivalent to 5per cent cashback). 

Therefore, keeping your spending up as long as possible will be the most rewarding way to use this card. Which is where your family members come in: get them to add their spending to the pool in order to fulfil the $2,000 monthly spend and get the most cashback possible each quarter. 

Citi PremierMiles Visa Card

The Citi PremierMiles Visa Card lets you earn air miles at 1.2 miles per dollar spent locally, and 2 miles per dollar overseas. 

Since Citi has made all supplementary cards free for life for this credit card, why not get your spouse and (fiscally responsible) kids a piece each and earn air miles on their spendings too? 

And if you’re worried about a glut of miles, don’t: Citi air miles have no expiry date. 

OCBC 365 Credit Card

The OCBC 365 credit card offers up to $80 cashback each month (or $960 a year, not bad!), but you’ll have to spend at least $800 per month to get the cashback. Despite the slightly higher-than-average minimum monthly spend, some like it for the fact that there is no categorical limit on cashback earning, unlike other cards. 

Recruit your family members to help you hit the monthly cap by pooling their transactions, especially if they frequently pay for online food delivery (6 per cent cashback), Grab rides (3 per cent cashback) and telco bills (3 per cent cashback).

It’s somewhat of a pity that the OCBC 365 supplementary card annual fees are waived only for the first two years. If you really want to save on the annual fee, maybe put your children on rotation with this card.

HSBC Advance Credit Card

The HSBC Advance Credit Card gives 1.5 per cent unlimited cashback on all your spends, rising to 2.5 per cent when you spend more than $2,000 a month. 

(Tip: Sign up for a HSBC Advance banking account and earn 1 per cent more cashback, for a maximum of 3.5 per cent cashback).

Ultimately, your cashback is capped at $70 per month (for non-Advance banking customers), but you can enjoy 2.5 per cent cashback for up to $2,800 worth of transactions per month. 

If you can’t quite hit this limit on your own, get your spouse and/or children supplementary cards to pool their purchases. And since you can apply for up to 5 supplementary cards free, there’s little reason not to.