To define a credit card for groceries, begin by defining a credit card in general. A credit card refers to funds or credit facilities extended to a cardholder by a creditor or lending institution like a bank, allowing the former to spend a borrowed amount on various lending categories. 

They include groceries, petrol, entertainment, dining, shopping (including online shopping), travelling, and utilities. The spending categories apply to local and overseas spending.

Unlike other lines of credit like personal loans, a credit card incentivizes the cardholder to spend the loan amount by giving rewards like points, cashback, a welcome bonus, and other exclusive privileges to the cardholder each time they swipe the card.

Moreover, such cards differ from mortgage loans because they allow you to spend money on diverse spending categories, except for Islamic banking credit cards-i, which forbid spending on haram goods and services, including alcohol and gambling services.

Lenders name the cards according to the spending categories that receive the maximum rewards per spending.

Therefore, a grocery credit card is a card with the highest tips for grocery shopping, offering the cardholder maximum returns or perks when shopping for groceries. 

Nonetheless, the best grocery shopping cards feature other categories, although these categories earn lower rewards.

Some card companies offering grocery shopping cards bundle two or three shopping categories, including groceries, for maximum returns.

According to one report, food price inflation in Malaysia is at an all-time high, meaning Malaysians spend more on food than ever. Therefore, a grocery shopping card will help you reduce your grocery spending.

The rewards from grocery shopping credit cards, particularly cash backs, directly lower your monthly grocery spending.

Others, like the Citi Business Platinum cards, feature an automated cashback redemption option, meaning the card credits accrue cashback into your account immediately after the cashback earnings hit a set amount.

Grocery cards in Malaysia often offer rewards in more than one shopping category. Therefore, you can select a card that offers other mega rewards on different shopping categories that constitute a significant portion of your household's monthly expenditure, including petrol and utility bills.

Besides savings, grocery cards empower you to build your credit score as you accrue and repay the card's debt. Credit cards are particularly useful credit-building tools for supplementary cardholders who may lack the monthly income to acquire credit as principal cardholders.

Also, most grocery cards issued by Malaysian banks are acceptable worldwide. Therefore, you can still earn cash back, discounts, and other rewards for grocery shopping when you swipe the grocery cards overseas.

To add to the list of benefits, grocery shopping cards function as an emergency credit facility when you cannot access your regular income for grocery shopping. Therefore, owning a grocery shopping card has way more advantages than disadvantages.

However, consider consulting the Financial experts on LoanPanda for professional insights into whether or not you need a grocery card.

Age, income, and credit history determine whether Malaysian banks and other lending institutions approve your groceries shopping card application.

• Age

You must be at least 21 to apply for a principal groceries card. On the other hand, you must be at least 18 years old to apply for a supplementary groceries card. We'll look at the differences between the two card types later.

• Income

Credit cards vary in the credit amount available to the cardholder. Banks consider income to ensure the cardholder can repay the loan based on their monthly income.

The cards are classified as gold, platinum, and infinite. Gold cards serve the low-income market, platinum cards for the middle class, and infinite cards for Malaysians with high monthly incomes.

• Credit History

Such cards are invaluable credit-building tools. Therefore, banks and other lending institutions consider your credit history, including your credit score and repayment history, before approving your grocery card application.

Therefore, consider establishing your credit score and contest any misleading information on your credit report before applying for a groceries card.

A principal credit card is a primary card attached to a credit card account. Therefore, a principal cardholder is an individual who applies for a credit card in a lending institution and has their name on the account once the lending institution approves their card application.

The principal cardholder is solely responsible for repayments, spending, and the physical whereabouts of the card. Therefore, they must report a missing card to the bank and the police to avoid unauthorized use.

On the other hand, a supplementary groceries card is issued under a principal account but held by an authorized party other than the principal cardholder. Therefore, you can only receive an additional grocery credit card when the principal cardholder requests the bank to issue one.

The number of supplementary cards attached to one principal account varies across the board, although some banks allow the primary account holder to have up to ten additional cards.

Malaysian laws dictate that only family members directly related to the principal cardholder, like children, parents, and spouses, can have supplementary cards attached to the main account. However, the additional cardholder must be at least 18 years old.

A supplementary groceries card has similar benefits to a principal groceries credit card, including similar rewards for grocery spending and spending in other designated shopping categories.

Moreover, the supplementary cardholder can use such a card for overseas spending. The supplementary credit card may also bear the supplementary cardholder's name. However, the principal cardholder may institute a spending limit on the supplementary cardholder's groceries spending.

Also, the supplementary cardholder reaps the benefits of a good credit score associated with a principal cardholder's account but is not liable for payment; hence delayed payments and defaults do not affect their credit score.

Malaysia's Central Bank, Bank Negara Malaysia, dictates that all Malaysian banks can only issue credit cards, including groceries cards, to Malaysians earning a minimum of RM24000 annually.

However, some societal groups like students, self-employed individuals, and freelancers may have difficulty proving their annual income because, unlike salaried employees, they do not have payslips. 

In such cases, banks recommend that the groceries shopping card applicant make a deposit equaling the credit card's total credit amount as part of their application process. The deposit functions as security, protecting the bank from the risk of credit card default. Most banks refund the card security deposit once you complete payment or close your account.

The maximum credit limit depends on your annual income. Bank Negara Malaysia stipulates that principal cardholders earning no more than RM36000 annually cannot receive credit exceeding two and a half times their monthly income when applying for a credit card.

However, no restrictions apply to principal cardholders earning more than RM36000 annually. Generally, banks decide how much credit to extend to their customers.

Your annual income stipulates the maximum number of groceries cards or any other cards you can have. Bank Negara Malaysia stipulates that a principal cardholder earning below RM36000 annually can only have cards issued by up to two lending institutions.

However, it does not specify whether you can apply for more than one card at a single lending institution. On the other hand, principal cardholders earning over RM36000 per annum can apply for as many cards as they want in whichever Malaysian lending institution.

Nonetheless, lending institutions consider their credit score, history, and monthly obligations before issuing high-earners with credit cards.

Yes, most groceries cards include a cash advance option, allowing the cardholder to withdraw cash at  ATM up to a set limit.

Some banks set the cash withdrawal limit for each transaction. In contrast, others put the withdrawal limit as a percentage of the total credit amount available to the cardholder via the card.

However, cash withdrawals from a credit card have a different interest rate or facility charge from the card's annual fee. Facility charges for credit card cash withdrawals vary from bank to bank; even within one bank, they vary for different cards.

Therefore, ensure you understand the cash withdrawal terms and conditions attached to your groceries card before making any cash withdrawals.

Most banks and other Malaysian credit card companies issue a late payment fee if the cardholder fails to remit the stipulated monthly payment within the stipulated timeframe.

The late payment fee is a preset percentage of the amount owed, although most Islamic banking cards stipulate that the cost should not exceed a specified amount. 

Besides the financial penalty, missing a payment will likely taint your credit history by lowering your credit score. A low credit score limits your credit options in the future.

Some lenders charge an annual fee, while others do not charge any annual fee. Second, some lenders waive the yearly fee based on stipulated circumstances.

First, a bank may waive the annual fee for first-time credit card applicants and supplementary cardholders. The lender may waive the annual fee if the cardholder fulfils the stipulated number of minimum swipes during the year or achieves the minimum spend amount on the card.  

The decision to apply for a groceries credit card that charges or waives annual fees lies solely with you. Regardless, ensure that the rewards you receive when using the card for grocery shopping outweigh the annual fee. Also, some grocery cards do not include annual fees, yet they offer exceptional perks in the grocery shopping category.

Cashbacks are among the many rewards cardholders receive when swiping grocery cards. However, the cashback varies across different cards.

For example, the Hong Leong Wise Gold Card and the HSBC Amanah MPower Platinum Credit Card-i issue an 8% cashback rate on credit, among the highest cashback rates in any spending category. Therefore, consider using LoanPanda to compare the cashback provision on different cards and other terms and conditions.