When people first arrive in Australia, the first thing many of them do is open a bank account.
They install the bank app, get a card, set up an account for their salary, and send money over from Korea. Once that is done, it feels like financial life has begun.
But in Australia, opening an account and having credit are two different things.
You can open an account.
You can get a debit card.
You can receive transfers.
But you do not have credit yet.
Someone who has just arrived in Australia may have money, yet within the financial system they are a person with a thin record. If you do not understand this difference, you can run into unexpected trouble with rent, phones, electricity, credit cards and car finance.
The bottom line
- Opening an Australian bank account is relatively easy, but a credit history has to be built separately.
- Your Korean credit score does not carry over into Australia as-is.
- What matters in your early months is not a great card but a clean financial record.
- “No Australian record” can come back as a cost and an inconvenience when you apply for rent, a phone, electricity or a card.
- It is better to treat your first six months as a period for building a record with no missed payments, rather than applying for lots of financial products.
Key terms first
| Term | Meaning |
|---|---|
| Bank account | Your bank account. The basic channel for salary, transfers and paying living costs |
| Debit card | A card that spends within your own account balance |
| Credit card | A card where the provider pays first and you repay later |
| Credit history | The record of credit activity you build up inside Australia |
| Credit score | A score calculated from your credit history |
| BNPL | Buy Now Pay Later. A pay-later service like Afterpay |
The important thing is this.
Having an account does not equal having credit.
Even if your credit was good in Korea, you start fresh in Australia
People who had a high credit score in Korea, a large card limit and no trouble getting loans can be caught off guard when they come to Australia.
“But my credit is good in Korea.”
That is true. But from the point of view of an Australian financial company, they cannot see that record directly, or it is hard to use as a basis for their own assessment.
Australia looks at your record inside Australia.
How long you have kept an account.
Whether a salary comes in.
Whether you have kept up with your phone bill and utilities.
Whether you have repaid your card on time.
How you have used loans or pay-later services.
So in the first few months, it is not that your credit is bad — it is closer to not yet having a record that speaks for you.
A bank account is the entrance to daily life
When settling in Australia, it is good to open a bank account early.
You need an account to receive your salary, you have to pay rent and utilities, and you need a channel to receive money sent from Korea.
Some banks let you apply online before arrival, but actually collecting the card, verifying your identity, making large transfers and using some features may require branch or in-app verification after you land.
When opening your first account, you typically prepare things like:
- Passport
- Visa details
- An Australian address or temporary address
- An Australian mobile number
- A tax file number (TFN) can be added later
Here, TFN stands for Tax File Number, your Australian tax number. It can also affect withholding tax on your bank interest, so it is worth registering it with your bank once you have it.
A debit card is not a credit card
When you get a bank card in Australia, it makes card payments. That makes it easy to assume “I now have a credit card.”
Most first cards are debit cards.
A debit card spends the money in your own account. If there is no money in the account, the payment fails or is limited. It is not a structure where the provider lends you money.
A credit card is different.
With a credit card, the provider pays first and you repay later. That is how a credit limit, a repayment record and any missed payments come into being.
In your early settling-in period, it may matter more to use your debit card and account steadily and keep a clean record, rather than rushing to get a credit card.
Where a lack of credit history bites
Not having a credit history does not make daily life impossible.
But it is inconvenient.
Your Australian record is thin on a rental application.
Signing up for a post-paid phone plan can be awkward.
Electricity and gas connections may involve a deposit or extra checks.
A credit card limit can be low, or the application declined.
Car finance or a personal loan is harder still.
At this point, even with money, you need to be able to explain yourself.
“My bank balance is plenty” and “This person has a record of paying steadily every month” are not the same thing.
The Australian financial system prefers the second one.
The goal of the first six months is building a record
In your early months, the basics matter more than flashy financial products.
- Open a bank account and set up a flow of salary or living costs.
- Get a TFN and register it with your bank and employer.
- Pay rent and utilities on time.
- Do not fall behind on your phone bill.
- Do not apply for too many credit cards or BNPL services.
- If you change your address or contact details often, update your financial institutions.
Here, BNPL stands for Buy Now Pay Later — buying now and paying in instalments later. Services like Afterpay are the typical example.
It is convenient, but using it too much early on can muddy your cash flow. Even a small missed payment does not look good on your record.
When should you get a credit card
A credit card is not a bad thing. Used well, it is convenient and can help build a record.
But the order matters.
Applying to several cards at once as soon as you arrive in Australia is not a good idea. Application records can be left behind, and repeated declines can actually work against you.
It is safer to first set up a stable flow of income, build up a bank transaction record, and sort out your address and visa status before you approach it.
For a first credit card, a low limit, simple terms and a low annual fee may be better than a high limit.
The point of the card is not fancy perks but a record of repaying on time.
Read next
- Renting in Australia: the cash that gets locked up first
- What to do with your money before Australia
- When does tax actually start in Australia?
- Sending money from Korea to Australia
- The Korea–Australia money map
Disclaimer
This article is general information. The rules for opening a bank account, card assessment, credit scoring and telco and utility conditions differ by financial institution and company. Before applying for any product, please check that institution’s conditions, fees and the impact on your credit file.