Portugal’s banking system offers a diverse selection of credit card options to suit various financial needs and lifestyles. As a resident in Portugal, understanding the types of credit cards available, their benefits, and associated costs is crucial. This guide covers everything you need to know about obtaining a credit card in Portugal including the reward programs available, installment payment options, and additional perks like airport lounge access.

Understanding the Basics of Credit Cards in Portugal

Credit cards are now widely accepted for daily purchases and online transactions in Portugal, and some shops and services only accept Portuguese debit or credit cards, so they can be handy to have. Banks and financial institutions offer an array of options tailored to specific needs, such as travel rewards, cashback, or premium benefits.

To apply for a credit card, you must meet eligibility requirements, including having a Portuguese taxpayer number (Número de Identificação Fiscal or NIF), proof of identity, residency, and income. Many banks also require applicants to open a current account, which is often linked to the credit card for managing payments and fees.

While credit cards provide convenience, they also carry costs such as annual fees and interest rates, which vary depending on the card type. Selecting the right card requires careful evaluation of its features, costs, and potential benefits.

Types of Credit Cards in Portugal

Portuguese banks cater to a wide range of financial needs with different credit card offerings. These cards vary in their features, fees, and target users. Below are the main types of credit cards available:

1. Standard Credit Cards

• These cards are straightforward and offer essential credit services without additional benefits
• They typically have low annual fees or none at all, which makes them ideal for individuals looking to pay with credit but not take on any additional expenses.
• Standard cards are best suited for day-to-day purchases and occasional use, with interest rates ranging from 13% to 20% APR.
• Many standard cards offer a grace period for interest-free payments if the balance is cleared within the billing cycle.

Caixa Geral de Depósitos, for example, is the largest state-owned bank in Portugal and has an array of credit cards for every day use here.

2. Rewards Credit Cards

• Rewards cards are designed to provide added value for everyday spending by offering points, cashback, or discounts.
• Travel miles are a popular feature, with some cards allowing users to earn miles on every euro spent. These miles can be redeemed for flights, hotel stays, or car rentals.
• Discount programs are also common, with banks like Millennium BCP and Santander Totta partnering with retailers, gas stations, and restaurants to offer exclusive savings. Other cards in Portugal include comprehensive insurance packages, 24/7 Concierge & Lifestyle Management services. University students can even enjoy cards that recognize student status internationally and can help you get student discounts around the world. Not to be left out, teachers can also get credit cards that help accumulate points and trips for TopAtlântico, one of the biggest travel agency groups in Portugal.
• These cards often come with moderate annual fees and may require a minimum income to qualify.

3. Premium Credit Cards

• Premium options, such as Visa Gold and Mastercard Platinum, come with higher credit limits and enhanced perks.
• These cards offer benefits like comprehensive travel insurance, 24/7 concierge services, and priority customer support.
• Many premium cards include access to airport lounges in major cities like Lisbon and Porto, providing added comfort for frequent travelers.
• The annual fees for these cards can range between €50 and €150, and they typically require higher income levels.

4. Co-Branded Cards

• Co-branded credit cards are issued in collaboration with airlines, retail chains, or other organizations.
• For example, TAP Air Portugal offers co-branded cards with Millenium bcp bank that reward frequent flyers with additional miles and travel benefits. Choose from Classic, Gold, Platinum, and Business, ranging from €41.60 per year to €312 per year in annual fees
• These cards often combine standard credit card features with exclusive perks, such as discounts on specific products or services.

Note: In our research, Visa has a much greater presence in Portugal compared to Mastercard, and most credit cards that you apply for will be Visa.

Credit Cards and Mortgages

In Portugal, many banks include credit cards as part of bundled financial products, especially for customers applying for mortgages. This practice is common as it allows banks to cross-sell multiple services while simplifying the financial setup for customers.

When bundled with a mortgage, the credit card often comes with a monthly maintenance fee, typically around €8. While this may seem minor, it is an additional expense that can accumulate over time. It’s essential to account for these costs when evaluating your mortgage offer, as they impact the overall affordability of the financial package.

Many expats who continue to use international credit cards may be forced get their first Portuguese credit card when they get a mortgage.

Fees and Costs to Consider

Credit cards in Portugal come with various fees and charges, which can vary depending on the provider and card type. Understanding these costs is essential to avoid unexpected expenses. Many standard credit cards have no annual fees, but premium and rewards cards typically charge between €20 and €150, with the fees reflecting the level of benefits offered. Interest rates for credit cards generally range from 13% to 20% APR, though paying off your balance in full each month can help you avoid these charges. Cash advances come with high fees—usually around 4% of the withdrawal amount—plus immediate interest accrual. Additionally, foreign transaction fees for purchases in foreign currencies typically range from 1% to 3%, depending on the card issuer.

Portuguese credit cards often allow you to divide larger purchases into installments, usually over 3 to 12 months, often with minimal interest rates, making it easier to manage significant expenses. These cards also offer robust security features, such as chip-and-pin technology, fraud detection systems, and 3D Secure for online transactions, ensuring peace of mind whether you use them locally or abroad.

How to Apply for a Credit Card in Portugal

Applying for a credit card in Portugal is a straightforward process. Here’s what you need to know:

Eligibility Requirements

• Proof of identity, such as a Portuguese ID or passport, is mandatory.
• You must provide proof of residency, typically through a utility bill or rental contract.
• Evidence of income, such as payslips, tax returns, or bank statements, is required to demonstrate your ability to repay credit.
• A Portuguese taxpayer number (NIF) is essential for all financial transactions.

Applications can be submitted online or in person at a bank branch. Online applications often have faster processing times, with approval usually granted within a few days for eligible applicants.

Best Credit Card Providers in Portugal

Several top banks in Portugal offer a range of credit cards with diverse features and benefits. Millennium BCP provides cards with cashback, discounts, and premium perks such as travel insurance and concierge services. Its platinum card stands out with access to airport lounges and a competitive rewards program. Caixa Geral de Depósitos caters to various income levels with its credit card range, from basic to premium options. Cards like the CGD Gold offer flexible installment plans and added perks, particularly for frequent travelers.

Santander Totta is well-known for its rewards programs, which include travel miles and retail discounts.  Novo Banco emphasizes low-interest-rate cards.

Portuguese Credit Cards vs. US Credit Cards

Some of our American readers may be wondering how Portuguese credit cards compare to their US counterparts. When comparing Portuguese credit cards to those in the US, notable differences emerge in rewards, fees, and payment flexibility. In Portugal, credit card rewards programs tend to offer much less, in terms of cashback options, discounts, or travel miles, often with limited redemption options. In contrast, US credit cards typically provide more generous rewards, including higher cashback rates, substantial sign-up bonuses, and versatile points redeemable across a wide range of travel and retail partners. Additionally, Portuguese credit cards stand out for allowing installment payments on purchases, which is not a standard feature in the US. This flexibility makes managing large expenses more convenient for cardholders in Portugal.

In general, Portuguese credit cards generally have lower annual fees compared to premium US options but also offer fewer perks. For instance, comprehensive travel insurance and concierge service are reserved for higher-tier cards in Portugal, while many US cards offer these benefits more broadly, albeit at a higher cost. Approval processes also differ, with Portuguese banks focusing on income verification and local residency requirements, while US issuers primarily evaluate credit scores and credit history. For expats and frequent travelers, understanding these differences is key to maximizing the benefits of credit cards in each country.

Final Thoughts

Obtaining a credit card in Portugal is a straightforward process, but selecting the right card requires careful consideration. Many expats may decide that they would rather continue to use credit cards from their home countries while in Portugal. Make sure to compare features, costs, and perks before making your final decision on whether to apply.