Almost 1 in 5 Americans have no credit score at all. While most of these individuals are younger adults who are just beginning their financial journey, millions of other Americans simply haven’t had the time or understanding of how to build their credit.
One of the best ways to build credit is through the use of a credit card; if you’re able to make payments on time, then you’ll show lenders that you’re financially responsible. However, the only caveat is that you often need good credit to be qualified for a credit card. What a catch-22, right?
Lucky for you, there are many credit cards and credit card companies out there that will accept applications from people with no credit. While you’re not likely to earn lots of cashback or travel rewards with cards like these, here are our top picks for the five best credit cards for no credit in 2020.
Best Credit Cards for No Credit
With no annual fee and no monthly charges, the Discover it Secured card is great for those looking to build credit without paying more fees. As a secured credit card, you’ll have to make a deposit, though. Whatever you pay as the deposit will be your credit limit, which means that it’s likely to be lower than most unsecured credit cards (the minimum deposit is $200).
This card does offer you the chance to earn cashback, however. Earn up to 2% cash back on the first $1,000 spent at restaurants and gas stations each quarter. And Discover takes it one step further; they’ll match the cash back rewards that you earn during your first year.
Similar to the Discover it credit card, the Citi Secured Mastercard is also a secured card. This means that you’ll have to pay a deposit to open the account, but that also means that they’ll accept users with little to no credit history. With no annual feel, this is a great low-cost card in terms of maintenance.
One of the biggest perks of the Citi Secured Mastercard is that the minimum deposit amounts are lower than other secured cards; pay as little as $49 or $99 to open the account. Then, purchase small items on the card and pay them off promptly each month. Citi will automatically consider you for a higher credit line in as fast as six months.
If you can afford the $39 monthly fee, the Capital One QuicksilverOne Cash Rewards card is a fantastic way to earn money while building your credit. Earn unlimited 1.5% cash back on every purchase while working towards building your credit. Capital One will accept applicants with credit scores as low as in the 500s, making it ideal for students and young professionals who have credit but not very long credit history.
As a precursory card to the Capital One Quicksilver Cash Rewards Credit Card, this card is ideal for those who know they’re going to build their credit long-term and are looking to continue their credit journey as their credit score improves. Plus, you can access all of Capital One’s standard features found in the Capital One mobile app.
Self is an online bank that works to give savvy savers the chance to increase their financial health. To get a Self Visa credit card, you’ll need to open a Self Credit Builder account. After making at least three monthly payments on time and having a minimum of $100 in your account, you’ll be able to set your credit limit and get your card.
There’s no extra deposit needed and no hard inquiry that shows up on your credit report. That’s great news, especially if you have bad credit or no credit. The fact that you really have total control over this account, yet it helps you build credit is what makes it one of the best credit cards for no credit.
Small business owners and entrepreneurs with no credit need access to funds, too. Now, they can easily access them via the Brex Card for Startups. To evaluate creditworthiness, Brex looks at the company’s investors, spending patterns, and cash balance. This ties it less to your personal finances and more to your business.
On top of that, however, you’re also able to earn rewards with this card. There’s no foreign transaction fee, and you can earn 75,000 Brex Rewards points when you sign up. Tack on the travel rewards, 7x points for rideshares, and automated expense matching features, and it’s easy to see what makes this such a great card for well-funded startups.
Watch Your Credit Improve
As you begin to use your credit card for no credit, you’ll quickly be able to watch your credit improve. In fact, it’s one of the best parts of beginning your credit journey. Not sure how to check your credit score?
Checking your credit score with Float is free, and we update it every two weeks for you. We’re also the first app that allows you to control how much information your share, making it fun and easy to learn where your friends and family are in their credit journey.
Interested? Download the app to get started today.