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Finding the best credit cards for Expats in Germany

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The credit card is becoming a very popular means of payment in Germany and is increasingly replacing the classic girocard (EC-card).

A credit card has become an important financial companion that, depending on the type of card, brings other useful functions with it. Find out more about the the best credit cards for Expats in Germany and the different variants and their respective properties.

What is the difference between a credit card and a girocard or Maestro card?

The girocard refers to the EC card that belongs to the giro account. It is suitable for many types of transactions. The German V PAY system is mainly used in this country.

Abroad, on the other hand, the Maestro card is more likely to be used. This is a girocard from Maestro. In principle, the Girocard and also the Maestro card belong to the debit payment systems.

Depending on the bank, either the V PAY or the Maestro logo is displayed on the girocard. They stand for the usability of the cards abroad. Cards with a V PAY logo can primarily be used in the EU . A more expensive chipset was used for this system, which at the same time stands for more security during payment.

So far, however, cards with the Maestro logo have mainly been recognized worldwide. However, these also mean a higher security risk. Above all, V PAY provides more security as authorization is carried out with a PIN instead of a signature.

With a credit card, on the other hand, payment is possible worldwide, depending on the acceptance of the credit card provider. The important difference is that the credit card does not belong to a checking account.

When do you even get a credit card?

When you apply for a credit card, the banks look at your finances. They are primarily concerned with your creditworthiness, i.e. how well you are financially. They usually check this with the data that credit agencies such as Schufa have stored about you. Whether money is regularly received in your account can also play a role. So they want to ensure that you can pay off your credit card debt.

In many cases, age also plays a role. As a rule, banks only issue their credit cards to customers of legal age.

If you are a minor or have difficulties with your creditworthiness , however, you should not despair. On the one hand, some banks do without such strict criteria. On the other hand, some banks also have credit cards in their program that are aimed at minors or people with poor credit ratings.

The type of credit card determines how it is billed

There are a total of four types of credit cards:

  • revolving credit cards
  • charge credit cards
  • debit credit cards
  • prepaid credit cards 

They differ mainly in the type of billing and in their conditions. There is also a mixed form, the virtual credit card. 

1. Revolving credit cards

Revolving credit cards are called “real” credit cards. The type of credit card widely used in America is characterized by the fact that you actually receive a loan from the bank . If you pay with a revolving credit card, the costs incurred will be paid off in monthly installments. The installment repayment is made either as a fixed amount or as a fixed percentage at the end of the month.

But be careful: this is by no means a cheap loan! As with a classic installment loan, interest is charged on the borrowed money. The bank sets the interest rate in advance. Often this is higher than with a classic loan. As with every loan, there is also a credit check. Based on the credit ratingthe credit limit for your credit card is set. Endless payment and overdraft is not possible with it.

FeatureRevolving credit card chracteristics
Billing typeBilling as a monthly installment
SCHUFA examYes
Credit lineyes, based on a previous credit check
Can be used onlineOnline payment possible
Possible uses on sitePayment on site possible
Possible uses abroadPayment abroad possible
target groupat least 18 years

Revolving credit cards in summary:

  • Credit card billing: monthly as an individual installment
  • SCHUFA exam: yes
  • Credit line: yes, based on a credit check

2. Charge credit cards

Charge credit cards are the most common type of credit card in Germany. The interest-free loan that the bank grants you with this type of credit card is billed monthly, similar to the revolving credit card.

With the Chargecard, however, the billing amount is not paid off in installments. You have to pay the booked sales in full at the end of the month. The credit card is often billed to your current account. So that you do not become over-indebted, the bank sets a credit limit based on your creditworthiness.

FeatureCharge credit card characteristics
Billing typeSettlement of sales at the end of the month
SCHUFA examYes
Credit lineyes, based on a previous credit check
Can be used onlineOnline payment possible
Possible uses on sitePayment on site possible
Possible uses abroadPayment abroad possible
target groupat least 18 years

Charge credit card in summary:

  • Credit card billing: monthly crediting of all sales
  • SCHUFA exam: yes
  • Credit line: yes, based on a credit check

3. Debit credit cards

The debit credit card is not a classic credit card: unlike the revolving credit card or the charge credit card, you are not granted an interest-free loan. The booked transactions are immediately booked from your checking account on the debit card.

The debit credit card is comparable to an EC card, which you can also use to withdraw cash from machines. Unlike the EC card, the debit credit card is only issued by credit card companies.

FeatureDebit credit card characteristics
Billing typeimmediate debit from the current account
SCHUFA examNo
Credit lineThe overdraft facility of the current account serves as a credit limit
Can be used onlineOnline payment possible
Possible uses on sitePayment on site possible
Possible uses abroadPayment abroad possible
target groupat least 18 years

Debit credit card in summary:

  • Credit card billing: immediately from the current account
  • SCHUFA exam: no
  • Credit line: the current account’s overdraft facility serves as a line of credit

4. Prepaid credit cards

Unlike traditional credit cards, prepaid credit cards do not grant you a temporary loan. The prepaid credit card is a type of prepaid card. You can top up the prepaid credit card via the credit card account. You determine how high the credit should be on the credit card. You can make payments within this credit.

If the credit is used up, no more payments are possible. Since there is no credit check here, the prepaid credit card is particularly suitable for people with a poor SCHUFA score , for young people or students who need to keep track of their expenses.

FeaturePrepaid credit card characteristics
Billing typeimmediate debit from the current account
SCHUFA examNo
Credit lineno credit line
Can be used onlineOnline payment possible
Possible uses on sitePayment on site possible
Possible uses abroadPayment abroad possible
target groupalso available under 18 years of age

Prepaid credit cards in summary:

  • Credit card billing: immediately after using the credit card
  • SCHUFA exam: no
  • Credit line: no credit line, as you determine the credit personally

5. Virtual credit cards

With virtual credit cards, you will not receive a physical credit card. You only receive the access data such as card number, expiry date and check digit. The virtual credit card is mainly used for online shopping and for payments on the Internet. 

The virtual credit card is comparable to the prepaid credit card, where you can only use the credit you have previously paid in. Since virtual credit cards are still rarely issued and with unfavorable conditions, a prepaid credit card is recommended.

FeatureVirtual credit card characteristics
Billing typeimmediate debit from the current account
SCHUFA examNo
Credit lineno credit line
Can be used onlineOnline payment possible
Possible uses on sitePayment on site not possible
Possible uses abroadPayment abroad is not possible
target groupalso available under 18 years of age

Virtual credit cards in summary

  • Credit card billing: immediately after using the credit card
  • SCHUFA exam: no
  • Credit line: no credit line

What are the costs and fees for credit cards?

  • Annual fees
  • Foreign transaction fees
  • Debit interest
  • Withdrawal Fees

Annual fees

The annual fees are billed once a year for the use of the credit card. Some providers also make the credit cards available to customers free of charge, so this fee is not applicable.

Foreign transaction fees

Most credit cards can be used for the payment in the EU are used without the one charge arises. In contrast, it is different in foreign currency areas . Most providers charge customers a foreign transaction fee for each transaction . This is often a low percentage of sales. They are not listed during the payment process and only appear on the credit card statement. It is therefore advisable to take a look at the fee schedule before using your credit card abroad.

Debit interest

The target rates are incurred when the authorized credit claimed is. However, this is only the case with Revolve credit cards. Charge credit cards, on the other hand, are interest-free.

Withdrawal Fees

Depending on the credit card, fees are charged for withdrawing money from the machine. There are big differences here between the individual providers. With some, only withdrawing in Germany is chargeable and with others only abroad or in foreign currency areas. You should also study the provider’s fee schedule for this.

The best online comparison tables for the best credit cards for Expats in Germany

How to use the comparison table

Simply fill in these options:

  • Annual turnover in the eurozone (Jahresumsatz im Euroland)
  • Annual turnover in non-euro area (Jahresumsatz im Nicht-Euroland)
  • Card company (Kartengesellschaft)
  • View / Status (Ansehen / Status)
  • Payment method (Zahlungsart)

NOTE: The comparison lets you sort the table with the following payment menthods:

  1. all
  2. immediate debit from the account
  3. monthly invoice
  4. installment function
  5. prepaid
  6. all including prepaid

You will get the 5 best credits cards in Germany for Expats

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Expaturmhttps://www.expaturm.com/
Expaturm aims to help educate Expats in Germany on key issues that they will have to deal with while living in Germany by providing everything you need to know about Banking, Healthcare, Lifestyle, and Housing in Germany
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