Credit-building debit cards, like the Extra debit card, are like a debit and credit card hybrid. They’re basically an alternative secured credit card but with a different security deposit and additional benefits.
Unlike traditional secured credit cards, which rely on a security deposit that sets your credit limit, credit-building debit cards are secured by a linked bank account, with the card’s credit limit determined by your account balance. When you use the card, the amount is borrowed and later paid back from your linked account balance. These payments are reported to the credit bureaus to help you build a positive credit history.
Most credit-debit cards don’t require a credit check and don’t charge annual fees or an APR like a traditional credit card. They might also come with extra perks like rewards or savings features.
Chime® Credit Builder Secured Visa® Credit Card
Step Visa Card
Extra debit card
Extra debit card
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Extra is a fintech company with banking services backed by its partner banks Evolve Bank & Trust and Patriot Bank, N.A. The Extra Card is a credit-building debit card that works by connecting the card to your existing bank account. The Extra Card's spending limit is based on your linked bank account balance, called your Spend Balance. When you use the card, Extra 'spots' you for the purchase, and then it pays itself back the next business day with your linked bank account.
At the end of the month, Extra totals up your transactions and reports the payments to Experian and Equifax, which help build your credit history. But it's not free. You'll choose between two plans: Credit Building and Credit Building + Rewards, costing between $149 to $199 annually or $20 to $25 monthly.
| Fee | From $20 per month |
|---|---|
| Minimum deposit to open | $0 |
Step Visa Card
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Step is a mobile-first banking app with a free credit-building secured card. Step helps to build credit by automatically paying off balances each month with funds held in the attached deposit account and reporting it to the credit bureaus. There's also no credit check, no APR or monthly fees. Similar to other secured cards, the Step Card only allows you to spend up to the amount in your deposit account.
Minors can also build credit with Step, though they won't start building credit until they turn 18 years old and opt in to it. Once they opt in, the last two years get reported to the three major credit bureaus.
| APY | 5.00% |
|---|---|
| Fee | $0 per month |
| Minimum deposit to open | $0 |
Varo Believe
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Varo is an online, FDIC-insured bank offering the Visa Varo Believe card that's designed to help you build a better credit score. You can set your own spending limit and enjoy no interest and no monthly fees. Varo states all credit histories are accepted, and there's no hard credit pull or minimum security deposit.
It works like this: If approved, you'll get a Varo Believe Secured Account, which is a deposit account that acts as security for your monthly Varo Believe Card payment. You transfer funds into the Varo Believe Secured Account, and the funds in the account sets your spending limit. Then you use the card, and with Varo SafePay on, Varo automatically covers purchases every month using funds from the Secured Account. The payments are then reported to all three credit bureaus. Any unspent amount in the Varo Believe Secured Account remains available to spend into the next billing cycle.
With no fees and APR, it's a solid way to start safely building your credit history. However, Varo has spending limits, and you can only move money into the Varo Believe Secured Account from your Varo Bank Account — so a Varo Bank Account is required to get the Believe Card.
| APY | Up to 5.00% |
|---|---|
| Fee | $0 per month |
| Minimum deposit to open | $0 |
Fizz debit card
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The Fizz debit card can help build your credit score, has no APR and requires no credit check. It's designed with college students in mind, but it's open to everyone. It connects the Fizz debit card to an existing bank account, which determines your spending limit and adjusts daily based on your balance. The card's outstanding balance is repaid automatically with your linked bank account, and Fizz reports payments to all three major credit bureaus: Equifax, Experian and TransUnion.
And unlike most traditional debit cards, the Fizz debit card comes with cashback rewards — something we typically see with regular credit cards. When you spend with participating merchants and build up at least $5 in rewards, you can transfer the rewards to your linked bank account.
| APY | N/A |
|---|---|
| Fee | $0 per month |
| Minimum deposit to open | $150 |
Cleo Credit Builder Card
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| Fee | $14.99 per month |
|---|---|
| Minimum deposit to open | $1 |
Experian Smart Moneyâ„¢ Debit Card
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| Fee | $0 per month |
|---|---|
| Minimum deposit to open | $0 |
Chime® Credit Builder Secured Visa® Credit Card
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Chime is a fintech company with banking services through its partners, The Bancorp Bank, N.A. and Stride Bank, N.A. Chime offers many banking products, including its Credit Builder card, which is a secured credit card. While not an actual debit card, it has no credit check, no annual fees or APR. You must move money from your Chime account over to the Credit Builder card to determine the spending limit — similar to a security deposit requirement with other secured cards. When you use the card and pay off the outstanding balance, the payments are reported to all three credit bureaus: Experian, Equifax and TransUnion.
The Credit Builder card is designed to link with the Chime Checking Account, so to qualify, you must have a Chime Checking account and make qualifying direct deposits of at least $200.
| Fee | $0 per month |
|---|---|
| Minimum deposit to open | $0 |
Current Credit Building Card
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Current is a fintech company with banking services provided by Choice Financial Group and Cross River Bank. The Current Build card is a secured, credit-building charge card. To get the Current Build card, you must have a free Current account, which comes with savings pods, early payday and more. The Build card is attached to the Current account, and the card's spending limit is based on what you deposit in your account. Payments are reported to TransUnion to build credit history. There's no credit check to apply, and no interest charges or annual fee. While there aren't any daily fees or an APR you have to worry about, know there is a 3% late fee if you're late on a payment.
| APY | 4.00% |
|---|---|
| Fee | $0 per month |
| Minimum deposit to open | $0 |
Sesame Cash
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Credit Sesame is a fintech company offering a prepaid debit card called Sesame Cash, which is backed by Community Federal Savings Bank (CDSB). To start building credit, you must open a Sesame Cash account and sign up for the credit builder product. When you move cash into credit builder, it becomes the security deposit for a virtual Secured Credit Card. Plus, you set the utilization ratio. For example, if you deposit $500 and you want the ratio to be 30%, it's a maximum of $150 with the credit builder account.
Once it's set up and you make purchases with the debit card, Credit Sesame looks for purchases that fit within the credit utilization ratio you set. An amount equal to the outstanding balance is set aside in your Sesame Cash account so you can pay off the balance each month. Sesame also offers automatic pay, so the balance is paid on time and in full each month. Sesame states they report to 'the major credit bureaus' but doesn't say which ones.
Sesame Cash costs $9.99 per month, and there's also a $3 inactivity fee. To waive the monthly fee, you must set up a deposit of at least $500 per month or spend at least $1,000 per month with the Sesame Cash account. To avoid the inactivity fee, there must be monthly movements or purchases at least once within a 30-day rolling period. The inactivity fee and monthly fee are waived for the first month.
| Fee | $9.99 per month |
|---|---|
| Minimum deposit to open | $0 |
One of the best benefits of credit-building cards is the opportunity to build a better credit history, and usually, that means fewer fees than traditional credit cards.
Credit-building products are considered safer than traditional borrowing methods, but with that safety comes some downsides.
Credit-building debit cards are best for anyone who wants to start improving their credit history, and many are often designed for college students or young people who are new to borrowing. Most of these debit-credit cards don’t require a hard credit pull, so your credit history isn’t a factor during the application process.
But you’ll need a security deposit or a linked bank account that’s funded for credit-building debit cards to actually work. They won’t build credit on their own — you have to use the card so that repayments get reported to the credit bureaus.
These cards aren’t designed for large purchases, earning cashback rewards or emergencies. They’re not made for seasoned borrowers who already have regular credit cards, either. If you’re a student in need of a regular credit line, but your credit score isn’t up to par, consider looking at student credit cards instead as they tend to have more lax credit score requirements than regular credit cards.
Both can help you build a credit history, but overall, debit-credit cards are likely to have fewer fees.
| Type of card | Credit check | Charges interest | Annual fee | Late fees |
|---|---|---|---|---|
| Credit-building debit cards | Rarely | No | Rarely | Rarely |
| Secured credit cards | Yes | Yes | Usually | Usually |
| Unsecured credit cards | Yes | Yes | Usually | Usually |
There aren’t many downsides to debit-credit cards. Many of them lack interest charges, late fees and hard credit pulls. Credit-building debit cards are worth it if you want to build your credit score.
But just like other borrowing options, credit-building credit cards could still harm your credit. While they don’t usually charge late fees, a late payment can be reported to the credit bureaus and harm your credit score. While they’re called credit building products, it’s up to you to maintain a positive payment history to actually improve your credit score.
Building credit takes time — often years of hard work. While credit-debit cards can help push you in the right direction, they’re also not the only way to boost your credit history — see more tips on how to build your credit.
No, prepaid debit cards don’t build credit history, and neither do traditional debit cards. Prepaid and debit cards aren’t a form of credit so they’re not added to credit reports. However, debit-credit cards are similar to debit and prepaid cards in that you can only spend what you’ve deposited in the linked account. Debit-credit cards are also a form of credit, so payments can be reported to the major credit bureaus to build credit history.
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