The rising cost of living has seen a surge in credit applications across the UK. Consequently, a large number of people are looking to improve their credit scores to achieve application success. Luckily, even the lowest scores can be improved through learning how to manage monthly bills. Credit builder credit cards can be great for this! Here are three cards that could help to improve your credit score and secure financial flexibility in these challenging times.
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1. Tesco Bank Foundation Credit Card
The Tesco Bank Foundation Credit Card offers a minimum credit limit of just £250, making it a fantastic choice for anyone who wants to limit the amount that they can borrow. Moreover, applicants are not required to have a good credit rating, meaning that you can apply for the card even if your score is not in great shape.
Compared to other credit builder cards, the Tesco Bank Foundation Credit Card has a low APR of 27.5%. As a result, the card is a safe option for users who have a history of late payments.
As well as the excellent APR, the Tesco Bank Foundation Credit Card has no service fees. it also allows users to access Tesco Clubcard benefits, which could help you to save money when you shop! Cardholders are also given access to Noddle support services that can help them repair a low credit score.
2. Vanquis Visa Classic Credit Card
The Vanquis Visa Classic Card offers one of the lowest credit limits on the market! Users can cap their spending at £150, preventing them from spiralling into too much debt.
The card is a great stepping stone for those who want to improve their credit and perhaps apply for slightly more competitive cards in the future. With a high APR, users are encouraged to pay back credit on time and adopt good credit habits.
While opting for a high APR card may seem like the poorer choice, the threat of high interest rates may force you to be more careful with your card. If you manage your Vanquis card well, you could receive a credit limit increase of up to £4,000. This could be incredibly useful as the cost of living continues to rise. The Vanquis Visa Classic Credit Card is designed for credit building. Therefore, you don’t have to have a good credit score to apply.
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3. HSBC Classic Credit Card
If your credit score is in poor shape, this could be an excellent choice for you! The HSBC Classic Credit Card offers a fairly low APR and is designed to get your credit score back on track. The card has no annual fee and offers a manageable credit limit of £250 to £1,000. The card also comes with a wide range of discounts and offers that could make it easy to eat out, shop and do more of the things you love.
Cardholders can access their accounts through a simple mobile app, making it easy to keep on top of their score. Furthermore, the HSBC Classic Card offers an impressive 56-day interest-free period on purchases. Therefore, users have more time to repay borrowing without piling up any interest.
Things to consider before rebuilding your credit score with a credit card
While using a credit builder card is an excellent way to rebuild your score, using any kind of credit card comes with its risks. When using a credit builder, your score will only increase if you make payments on time and keep your credit usage low. If you struggle to pay back what you have borrowed or spend over your limit each month, this could negatively impact your score even further.
If you have previously struggled to make credit payments on time, it’s best to apply for cards that have a low credit limit. This will put a cap on how much you can spend, which will help you avoid spending more than you can afford to pay back. It’s also wise to make the most of message notifications and use these as reminders to pay your bills.
