First, a few disclosures. I don't work for any Thai bank. I don't receive any kind of benefit; direct or indirect, implied or not from any Thai bank or this site. These are my own personal experiences; yours may be similar or not.
Some background on me. I am a single (unmarried with no dependent children) American and have been in Thailand now for about four years and have been working at my university for just over three years on a yearly renewable 12-month contract.
My monthly base salary is easily more than B50,000 but slightly less than B100,000 and is directly paid into my bank account. I do earn some extra income by doing special assignment work, but that is not consistent.
I have paid Thai income taxes and have tax clearance letters from the Revenue Department. Naturally, I hold a valid work permit for this work. I rent a condo in Bangkok from a (private citizen) Thai national on a renewable yearly lease.
I don't maintain an overly large savings account balance at my local Thai bank as I remit the bulk of any saved funds back to the US for ongoing investment purposes. I don't maintain any substantial investments or other assets in the Kingdom.
Ok let's move on.
I'll start with some Q&A's that I was asked by fellow foreign teachers on this matter. Then review the process I went thru.
Q: Can a foreigner - an English teacher - get a true unsecured credit card from a Thai bank?
A: Absolutely yes! However, like many things in Thailand, there can be a lot of "maybe" between the ‘yes' and reality. It will require some time, planning and preparation work on your part to do so.
Q: Why do you want a Thai credit card and all the hassles that applying for one comes with?
A: Everyone has to make this decision for on their own. For me, there were two compelling reasons. First, there are some decent promotions like for dining and entertainment that are only available to Thai-issued cards; not foreign Visa/MC cards.
Second, as my goal is to remain in the Kingdom on a long(er) term basis, getting a credit card will either start or strengthen my credit report/file as maintained by the NCB which will only be an asset in the future. Remember though, you still have to manage the account and payments and just as it is with most of our ‘home' countries, failing to pay bills timely can, and usually will come with consequences.
Q: What income do you need to have?
A: Ahh, one of the magical numbers. My experience was that B50,000 per month, was the bare minimum for any card. Yes, for a Thai, the minimum was commonly around B15,000.
Your math is correct; the foreigner must have an income that is more than 300% higher than a Thai. Fair? I'll talk about that later on. I will say this, remember that minimums are bank-specific, and not set by Thai law, so they'll vary from bank to bank. It is my experience that if you are not making B50,000 at minimum (and that's on-the-books income via a work permit-based job) that your odds are not all that good.
A few words on this "income" part. My experience was that the income you need to meet their minimum, must have come from a/the job in your work permit(s) and/or that income had to be shown in your bankbook- and with the correct ‘salary' deposit code not just a regular cash deposit (if your bank uses such). I did ask several banks what if you had an informal second job (one where you didn't have a work permit for and/or were paid in cash) and was told by more than one bank that it wouldn't be accepted as means to meet their minimum income threshold.
They did say that it might be used to establish a higher credit limit, but only if I met the minimum income via income that came from a work permit based job and salary that was "on the books" as in shown in my bank book. Lastly, two of the four banks looked closely that my salary deposit was entered into my bank book using the "SAL" salary code. For Bangkok Bank (I assume others are the same) there is a specific code for deposits that are for salary purposes only and/or come from legitimate employment situations, as opposed to all other cash-type deposits which are coded differently.
Q: Does it really matter what bank I choose to apply at or the specific branch of that bank?
A: YES it does, and possibly yes it does. As one might expect, each bank had slightly different criteria (which is proprietary and therefore won't disclose to you nor are they required to disclose to you) for what a successful applicant had to present or have. All the banks naturally list minimum paperwork needed, plus minimum income levels; however, this does not mean that approval is guaranteed. So, one bank may have ‘easier' criteria than another bank - the hard part is that the banks credit card department won't directly tell you what it is. Remember all banks will periodically adjust up or down their lending criteria as overall economic conditions change, the banks performance/risk tolerance changes and/or their outlook for their credit card lending operations. Timing when you apply can impact your chances, but this isn't largely a day-to-day metric, but a longer term issue banks review.
As far as the specific branch of the bank goes; my experience and casual questioning is that YES, some branches (and even employees) may be ‘easier'. However, there is a caveat, remember that the actual approval does not happen at the branch, or even by a branch manager. Approval comes from the credit department - usually at the head office. Now, sure, a branch manager or other employee may have some "pull" or clout. The manager may have a title or have substantial seniority with the bank and may be able to pick-up the phone and get you approved, but the end, as far I can tell, branch level people cannot actually and formally say approved or not.
That said, I think it is always wise to apply at a branch where the branch or employee has some vested positive interest (financially or not) in your application. This person may make positive notes on the paper application, make email comments to the credit department, or call the credit department on your behalf. So, common sense says, go somewhere where they seem to want you to get the card. I walked into a smaller branch of one bank and got the immediate ‘feel' that the employee either didn't care if I was approved or didn't want to ‘deal with' a foreigner. I quickly and politely reclaimed all my documents, the partly completed (unsigned) application, and left.
I have heard from employees at three of the four banks I applied at, that as a part of the overall branch assessment, the number of credit card applications that are collected is something that is measured. So, if you have a good relationship at your bank, I'd most definitely start there as they may have some motivation to go the extra mile for you and your application.
Q: What about the need for a work permit?
A: Ahhhh. One of the other "minimums". Is it really a requirement? From my experience, YES. All four banks I went to said a valid work permit was a "must-have" item. I did ask all four banks, "What if I didn't have one?" All four said the same thing. No work permit, no card, no way. Full stop. (note: I did NOT ask about a secured card, and I clearly told them I was only interested in a true unsecured card)
Also, two of four banks required that I had held my permit for TWO full years and that is must be from the same job/same permit. Three banks required that the permit be valid for at least two months after the date of application (assume it was so that the permit wouldn't expire while my application was in-process) and one required it to be valid for six months after date of application. Point here; don't apply just before it expires. The earlier you apply the better. Again, timing here matters.
[Note: I am not a retiree and make no judgement as to retirees' finances, financial stability or creditworthiness and my article today is limited in scope to just those who are working or are under the retirement age based on current Thai rules. I cede that how banks view and process retirees can be different from those who are of working/non-retirement age.]
Q: What about proof of residence?
A: Surprising to me, this seemed to be a non-issue. None of the banks required any formal documentation as to my place of residence. What did I use? As stated earlier, I rent a condo from a private citizen (the condo owner) on a yearly written lease. So, I had a copy of the lease, signed by both of us, plus a copy of the owners ID card and blue book. Did the banks care? From what I could see, the impact was nominal. Yes, they looked at it. Yes, they made some notes, but from what I could see, having that much paperwork to prove my residence was not necessary.
Do I think this is good to have? I do. I'll explain why at the end. Think "credit story"
Q: How did you prove your income?
A: The banks will all require a copy of your bank book. Also, you'll need to have some kind of original salary slip or something in print from your employer that shows your actual pay and dates. Here's what I did. I asked my department (first asking the department head for permission) to write a customized letter to the bank by name, on original university letterhead, stamped and signed that clearly stated; a) my monthly gross salary, b) the actual dates that I received my salary for the past six months, c) my job title, d) my start date, e) the name, branch name and full account number where my salary is deposited.
his of course should match - perfectly - with the dates and amounts printed in my bankbook and match the dates and information printed in my work permit. All four banks took some time to closely check this data for accuracy and match the information on the letter to the work permit and bank book.
This item is a really important one - be sure you've got it - and that's it is accurate and clear.
Q: What else did you provide?
A: I'll list everything I provided. However remember that this list is more than what all banks asked for.
1) Passport. Copy of all of my past extensions, plus the current extension and last entry stamp.
2) Work permit. Copy of every page that has any marks or writing.
3) Bank book. Copy of the first/data page, plus all pages sequentially going back at least six months.
4) Salary Slip. Original letter from the university, on letterhead, stating salary, payment dates, job title and time/length of tenure. Plus specific name and contact number of someone who can verify this information.
5) Contract. Copy of my prior and current employment contract.
6) Tax clearance letter. From Revenue department which states my income as reported and tax paid (or refunded) for the tax year.
7) Condo lease. Original letter from my landlord stating rental terms, plus a copy of the last two years contracts, plus a copy of his ID card and house book.
Q: It is helpful, or not, to give the bank more information than they require?
A: Hard to say for sure. But here is my take on it. The onus to "prove" credit worthiness falls on you; not the bank. The bank only sets minimums, not maximums. Therefore, in my opinion, anything that I can provide that improves the perception of my creditworthiness will at minimum be positive, not negative.
Yes, a few banks that did not explicitly require a copy of my contract or residence information, simply passed those documents back to me and didn't include them with the larger application packet that was eventually sent to the credit card department for processing, but most gladly accepted them.
Q: Did the bank verify your documents?
A: YES. First, let me say this upfront. I am wholly in favor of doing everything you can to improve your odds of approval, however, I don't advocate (in any way, shape or form) lying, falsifying or presenting information (in print or otherwise) that you know is materially false or materially misleading. All the banks verified my employment (dates, job title, pay rate, pay dates and work permit) either by a phone call or fax, to my employer. Two of them actually faxed a copy of the salary verification letter that I had presented to the bank, and asked my employer to certify that it was a genuine letter and that all the information was correct.
Q: Do you have to have an account (savings/current or otherwise) with the bank to get a credit card?
A: No. Based on the four banks I applied to, none of them stated having a deposit account as a prerequisite for an unsecured credit card. Now, do I think it helps? I absolutely do, again, I come back to the notion that you're making a "credit story" for the bank to approve you - and having an established track record with them I would think would only be a help. However, since it appears that no bank makes this a mandate, I think that whatever help it may provide, will be minimal at best.
Q: So what's the actual process? How did you do it?
A: Most all banks will accept applications; 1) in-person at a branch office, 2) by post mail, and/or 3) via their website/online (with follow-up mailing of required documents). I chose only option number one - in person. I did this because my experience has been (unfortunately) that if something is not right or correct, some front-line staff may choose to simply not "deal" with it (for any number of reasons), and that would end up being a denial, versus taking the time, effort and possible hassle, of calling you - a foreigner - to get it fixed. This is not a condemnation of Thai staff, but just a simple realization that I want my application to be "adjudication-ready" the first time.
Here's the step-by-step that I took:
1) Prepare: I made four complete sets of all the paperwork I needed, plus optional paperwork (like the copies of my contract) that I planned to give as well. I also drafted a short cover letter which outlined the papers I was presenting, and making a short paragraph-long "credit story" case for why I should be approved.
2) Review: I looked over every single piece of paper, every copy, every line.
I walked into each bank, with a freshly pressed suit and tie, took a number for new accounts or credit applications and took a seat to wait. I was helped by a banker, and not a traditional teller employee.
(Note: As is customary here, I'd suggest you ‘dress to impress'. While there was no box on the application marked "was the applicant dressed neatly?" as most know, outcomes of interactions can be influenced by dress/appearance - so wear something business like!)
Each bank did about the same thing. I presented my documents to the banker. S/he would review them - painstakingly so - and made sure I had all the necessary documents, they were originals when needed, signed, dated, stamped, covered the right time period, etc. The banker checked the information on my salary against the name and job in the work permit. They checked to the dates and amount of my salary against the entries in my bank book.
After the review (which lasted a solid 10 to 15 minutes with me just sitting there) the banker pulled out a credit application and filled in the necessary information based on the documents I presented. Applications at three of the four banks were all in Thai, only one was in English. After the banker was done, I was asked to sign in about five to seven places. The banker counter-signed as witness.
Warning-be sure ALL your documents are correct to 100%. If it says six months of paperwork, don't give them five months and 29 days; they'll reject that. If it says an original, don't come with a color copy; they'll reject that. Be sure you sign (preferably in the presence of the bank officer) EVERY place where it's required-that will be about five to seven times (assuming you are not applying joint with spouse or applying for a second/additional card holder)
Bring your original passport, original bankbook, original work permit.. They will usually ask to see it and compare that to the copies. If you can bring originals of other papers, do so - banks appear to love originals and verifying originals.
Once you've signed, turned over all your paperwork, you just need to wait.
Don't be surprised if the bank calls you. Several of the banks did call me on my mobile phone to "confirm" some information:
a) Where do you live?
b) What is your national tax ID number?
c) What is the address/full name of your employer?
I personally find it a bit odd. All the banks that did call me, were calling about information that they already had on my application itself or one of the original documents I submitted. My suggestion is to be sure your verbal answers match 100% to what is stated on the paper application or originals.
Another warning. All the banks did verify my employment status, salary amount and dates. Three banks required my employer to either send a letter (via fax or postal mail) confirming the details of my salary slip or sign a fax that was sent to them; only one accepted a verbal confirmation. So, my suggestion is to alert your employer or staff member(s) who would answer your office phone or be empowered to answer these kinds of calls/faxes/letters/inquiries that you are applying for credit. I suspect that ANY deviation in answers would lead to a denial.
Waiting.. Trust me, you'll wait..
From the date I walked into the branch office, to the date I was told (usually by a SMS or phone call) that I was approved was no sooner than 19 calendar days to as long as 37 calendar days! Once approval was communicated to me, cards physically arrived at my condo in about 5 days thereafter by registered mail.
A few comments..
Remember that a credit card (again, I am referring to a traditional credit card, not a secured card) really is a personal loan by the bank, and is wholly unsecured. Unlike a house loan or car loan, there really is no asset that the bank can quickly and realistically "seize" that will meaningfully cover their losses if you default. Yes, some applicants may have assets like a condo or car in their name which may be something the bank may be able to target in a legal/default action, but the process that bank would need to follow to actually get legal custody of that asset is not an overnight or cheap process.
Banks know that as a foreigner, the (ugly) truth is that, unlike a Thai national, it is far easier for you to simply default on your accounts and permanently leave the country. Yes, the bank can still pursue legal options against you - in Thailand - in your absence. In the end, once you leave the Kingdom, the reality is that the banks chances of any meaningful financial recovery from you are very small. Yes, a Thai can also default on their account, but unlike a foreigner, they are less likely to permanently leave the country expressly as a means of avoiding repayment, therefore by remaining in the Kingdom they would still be "contactable" for legal proceedings and any judgements levied against them.
As a foreigner you have less mobility in terms of jobs. A Thai can largely move from job to job as they please and do so with minimal paperwork/permits needed. By contrast, a foreigner would commonly need a whole new work permit, (possibly) a new visa and some jobs are statutorily excluded to foreigners. Banks do however recognize that as a rule, foreigners who apply for a credit card tend to earn higher salaries than a typical Thai who also applies. Yes, every case is different, but the impression I got was that the large disparity in minimum income levels was a means to offset these kinds of risks.
Referring to teachers explicitly, the banks are aware that many foreign national teachers must have a license - TCT/Krusapah issues - and this can be "problematic" and that not all teachers who apply today will be able to maintain the requisite licenses/permits indefinitely into the future. For the banks, this translates into another aspect of non-national applicant credit risk.
The overall message I got was that like all applications, you are essentially making a "case" for an unsecured loan. I did ask if it was ok, helpful, unhelpful or neutral to provide more documents than the bank's minimum paperwork that might show you to be credit worthy? The answer was that it depending on the banks policy, it would, at minimum be neutral, to at best be positive. However, I did also get a fair warning that banks are aware of and do look for fakes, forgeries and other less-than-honest applicants.
Your application will pass thru about three to five people or steps. The first is a document checker (which if done correctly at the branch level, should be a non-issue). If all the documents are correct in every detail, then it goes to processing. If ANYTHING is wrong, even in the minutia, expect a phone call at minimum to fix it, or more likely, an outright rejection.
Step two is where the credit report authorization is requested and received. After the credit report is received, it goes to the third step, the credit analyst. Here is where you get a ‘yes' or ‘no'. If it's yes, they usually also indicate the credit limit you'll start with. After this person, it's usually checked by someone senior who reviews the analysts ruling and overall application for completeness. Here is where a ‘no' might be turned into a ‘yes' if you've made a good story. On most of the applications you can see some boxes where these people must ‘sign-off' when their roles are completed.
A few words about credit reports. They are becoming more common, and all the banks I used required I consent to having my credit file (with the NCB, the Kingdom's only national credit reporting entity) sent to them. If you have one, I'd be 100% sure that it's accurate. If it's not, get it fixed before you apply - not after. I suspect that a "bad" or adverse report is an instant no-go situation.
Also, as best as I can tell, a Thai credit report does not factor how many times or places you have applied for credit in the past. This is different than how the US operates. In the US, your credit score commonly gets reduced a few points each time a creditor formally "pulls" your report due to a credit application. That does not seem to be the case presently in Thailand. Therefore, there does not seem to be any real downside to applying to more than one bank at a time or sequentially.
Lastly what would I do IF I didn't meet the banks minimum salary levels? Here's my opinion. Since granting credit or not is purely an internal and subjective decision on the part of the bank, I'd say that IF you are close and can make a bona fide "credit story", then I'd go for it! There is no application fee (meaning to just apply) and there is no rule about how often you can apply or must wait if you're denied earlier. Therefore, aside from your time and some incidental costs to make copies, it doesn't cost you a whole lot to apply.
This is where my term "credit story" comes into play. If you can make a convincing credit story - via documents you can present; and can be verified (as you won't be able to personally appear at the credit card approval department) - then I'd do it! However, I also think you need to be honest with yourself and assess your case against what the bank posts as their stated minimums and other qualifying factors.
Am I happy I did it? Yes. I use many of the promotions that come with the cards and having a Thai-issued credit card gives me one more financial tool that I didn't have before.
However, as I noted at the beginning, it is something that you will need to manage and budget properly (interest, if you carry a balance, is not cheap) and any misuse/mismanagement can potentially cause problems in the future. As the use of a credit report is becoming more and more common, I'd want to be sure I protect my score.
Best of luck to those who want to try. It can be done.
Note: This is just my opinion and my experiences. It is not meant to be a definitive answer as each person's situation can and will be different and each bank has their own credit granting formulas and policies. Your experience may differ from mine. This is only to provide those who have been considering applying one person's experiences and viewpoints on the matter.