Having a good credit history and score is important. If you want banks to lend you money, for a personal loan, mortgage, or you want to be approved for credit cards that have benefits like rewards or cashback, you need a good credit record.
But to get a good credit score, you need to have previously borrowed money and managed that credit well.
While this seems like a Catch 22 scenario, there are a number of credit cards which explicitly target borrowers who are new to credit.They offer a chance to prove you're a responsible borrower, before moving onto more exciting credit cards.
What to look out for
Firstly, it’s important to be aware that these cards come with extremely high rates of interest, so you should always endeavour to pay off your credit balance in full every month.
It’s very easy when paying with a card to not think about how much you’re spending, so you should regularly check your online statement to make sure you’re not going overboard.
If you are refused a card, don’t simply move straight on to the next card in the hopes of securing credit. If you apply too many times for credit in a short space of time, lenders will be less likely to lend to you, as you’ll look increasingly desperate with each application.
There are other ways to improve your credit score besides sensible card usage – find out how to put these to use and build an excellent credit score, and learn how to avoid damaging it.
Is a poor credit score ruining your credit card applications? Check yours now for free
Best credit builder cards
These cards are all specifically designed with new borrowers in mind, though some are also an option for those looking to rebuild a poor credit history.
|
Credit card |
0% period on purchases |
Representative APR |
Credit limits |
|
None |
29.8% |
Up to £1,000. This can be increased every five months up to £3,500. | |
|
Three months |
34.9% (will be reduced after 12 months if you always pay on time and stick to credit limits) |
Between £150 and £1,200 | |
|
None |
39.9% |
Between £150 and £1,000 | |
|
None |
49.9% |
Between £100 and £300 |
From the table, you’ll see why it was necessary to mention the high rates of interest – they really are off the charts when compared with regular credit cards, and these are in place to deter irresponsible borrowing among those who have a shaky, or non-existent history.
The Aquis Visa Credit Card has the lowest representative APR among these cards, but it's still extremely high at 29.8%. The Barclaycard Initial is the only card here to offer a 0% introductory rate on spending. However, you shouldn’t build up a large balance just because you’re not being charged interest. After the three months are up, you will be slapped with a massive interest rate of 34.9%.
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A stepping stone
Think of these cards as a stepping stone to a better deal in the future. They’re not free money, and should be used with real care, because irresponsible use could both damage your credit score and cost you a lot of money in interest repayments.
Once you’ve built up a decent credit score, then you are more likely to be accepted for cards that give you real benefits, like long 0% periods on purchases, cashback or other rewards. A good score and clean credit report will also look great if you apply for a bigger loan such as a mortgage or personal loan.
Is a poor credit score ruining your credit card applications? Check yours now for free