How important is getting a credit in Singapore? Does credit score matters?

Hi Daryl,

Here's my opinion on credit score.

Credit score affects a variety of things, such as credit card approvals, loan approvals, interest rate on loans, and potentaially job opportunities in the financial sector.

As for how important it is, it depends - do you plan to ever use credit cards? Do you plan to ever get a loan (housing, car, business)? Do you plan to ever work in finance?

If your answer to all of the above is no, then you could say that it doesn't matter. But for most people, the answer to the first 2 questions are usually yes.

For example, using credit cards can bring a lot of benefits such as better rewards than debit cards, better protection against fraud (any spending is on credit, not your cash - banks can settle the dispute for you), free perks (complimentary travel insurance, card benefits). If you don't have a credit score, it can be hard to get approved for credit cards in future.

Ultimately, I feel that credit score is important because it opens up more opportunities for you in life. Even if you don't think you will need a loan in the future, you'll never know what may happen and you may need to take out a loan for unexpected reasons. A good credit score will give you the best chance to be prepared for such situations.

Hope this helps!

Regards,

thefrugalstudent​​​

I haven't had to get any loans yet so my reason for getting a credit card is more for its immediate benefits (e.g. cashback) instead of building credit score... but hey that's a nice side-effect.