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You might know that you need good credit to get approved for loans. But you may not know how to get a good credit score.
Using credit cards to build credit could be the answer. Opening a credit card in your name and using it responsibly can help you establish a positive credit history. The key is finding the right card for you.
Chime’s Secured Credit Builder Visa® Credit Card is one option you might consider if you have a Chime Checking account or plan to open one. Another option is the Extra debit card if you’re interested in earning rewards while you build credit.
Chime’s Credit Builder card offers a path to start building credit¹ without maintenance fees, interest, or a credit check.
Comparing Extra vs. Chime can help you decide which card fits your needs best.
How do secured credit cards build credit?
When you open a secured credit card, you typically need to put down a cash deposit. That cash deposit doubles as your credit limit.
When you make purchases, the amount you spend is deducted from your credit line. As you pay down the balance, you free up available credit. Meanwhile, the card issuer reports your payment history and credit usage to the credit bureaus, which factor into your FICO® credit score calculation.
Chime’s Credit Builder card is slightly different since there’s no minimum security deposit requirement.² The Extra debit card, meanwhile, allows you to build credit through monthly purchases and payments, but it’s not a secured credit card.
Learn more about how secured credit cards work.
Chime's Credit Builder card
Chime’s Credit Builder card is designed to help you build credit safely.¹ The Chime Credit Builder Credit Card is a secured credit card, but as mentioned, there’s no minimum security deposit requirement.² There are also no high fees, which you might encounter with other secured credit cards.
So how does Chime help you build credit? Simply by allowing you to get credit for the purchases you make every day and by making regular on-time payments.¹ You can use the Credit Builder card anywhere Visa® cards are accepted, and Chime reports your on-time payments to the credit bureaus. Chime members see an average increase of 30 points to their credit scores while using the card.³
Here are the key features of Credit Builder:
- You pay no annual fee, no maintenance fees, and no foreign transaction fees.
- There are no interest charges on purchases made with the card.
- Chime does not require a credit check to apply.
- Chime’s Credit Builder card has no minimum security deposit requirement.² Instead, you can decide how much to spend by moving money from your Checking Account into your Credit Builder secured account.
So, how does Chime’s Credit Builder work exactly?
If you have a Chime Checking Account and receive a single $200 qualifying direct deposit, you’re eligible to apply.4 Again, there’s no credit check, which may be ideal if you have limited or no credit history. And if you don’t have a Chime Checking Account yet, you can apply for one in under two minutes.
Once your account is open, and you’ve received your $200 qualifying direct deposit, you can move money from your Chime Checking Account to your Credit Builder secured account. That means you have control over how much you can spend since you decide the amount.
You can move money manually from your Chime Checking Account, but Chime helps make building credit easier with the Move My Pay feature and the Safer Credit Building tool. Move My Pay allows you to automatically transfer part of your direct deposit to your Credit Builder secured account. When turned on, the Safer Credit Building feature makes your payments automatically, so you never have to worry about paying late.¹
Chime’s Credit Builder card pros and cons
Credit Builder can help you grow your credit history with fewer hassles. With no credit check to apply, Credit Builder is accessible to a wide range of people who may be new to using credit or are looking to rebuild credit.
Here are some of the best reasons to consider Chime’s Credit Builder card:
- Having a thin or nonexistent credit file won’t count against you
- Applying for the card doesn’t hurt your credit
- There is no minimum security deposit,² so you don’t need to come up with a lot of cash at once
- You won’t pay interest or fees with the card
- It’s possible to build credit history with all three major credit bureaus
- You have control over how much you spend
- Since it’s a Visa® credit card, you use it at a variety of merchants online and in-store
Are there any cons associated with Chime Credit Builder? No, not really. There is no rewards program, but that’s not unusual for secured credit cards. And if your goal is to get a card that helps build credit, forgoing a rewards program may not be a dealbreaker for you.
Extra debit card
Extra is a debit card that builds credit and allows you to earn rewards on purchases.5 Extra is not a credit card. Instead, the Extra card connects to your bank account and will enable you to get credit for purchases you make with the credit bureaus.
You can connect an existing bank account to Extra, which works with over 10,000 banks. Extra gives you a spending limit based on your bank balance and other factors. When you swipe your card, Extra “spots” you the money, then pays itself back from your bank account the next day. Extra reports these purchases and payments to the credit bureaus at the end of the month.
Here are some of the key features to know about the Extra debit card:
- Extra is a debit card that works with your bank; it’s not a secured credit card
- There is no credit check to apply for the Extra debit card
- Extra charges a flat monthly subscription fee ranging from $8 to $126
- Extra reports account activity to Experian and Equifax (but not TransUnion)6
- Cardholders pay no interest
- Upgraded membership includes additional benefits
The Extra debit card uses the money in your bank account to help you build credit. You won’t need an additional security deposit to open an account.
You can choose between a Credit Building account and a Rewards + Credit Building account. If you opt for rewards, you can earn up to 1% in points for everyday purchases. You can spend points on gift cards or merchandise in the Extra debit card rewards store.
While Extra charges on interest, you will pay a monthly fee to use the debit card to build credit. The fee for the Credit Building plan is $8 per month; for Rewards + Credit Building, it’s $12 per month.
Extra debit card pros and cons
The Extra debit card might appeal to you if you’re looking for a way to build credit without applying for a credit card. Extra can work with your existing bank account to help you build credit history based on your daily spending.
Here are some reasons why you might consider the Extra debit card:
- There’s no credit check to apply
- It’s not a credit card, so there’s no risk of creating debt
- Cardholders pay no interest
- You have an opportunity to earn rewards on purchases
- It’s possible to build credit with two out of the three major credit bureaus
Now, why might you think twice about the Extra debit card?
First, there’s the monthly fee to consider. If you’re paying $8 per month for the Credit Building plan, that adds up to $96 per year. That’s similar to what others might pay for an unsecured premium rewards credit card. The Rewards + Credit Building plan is even more expensive, at $144 per year.
Earning rewards back on what you spend can help to offset the fee. But it’s important to be realistic about how much you might be able to earn in reward points based on your typical spending habits.
Also, Extra determines your spending power with the card. So you might have much less purchasing power with this card compared to what you might get with a traditional secured credit card.
Chime vs. Extra: What's the best card to build credit?
Using secured credit cards to build credit can make sense if you cannot get approved for a traditional credit card yet. Whether it makes sense to choose Extra vs. Chime for building credit can depend on what you’re looking for in a card and how much flexibility you’d like to have in managing it.
Here’s an overview of how these two cards compare.
|Chime’s Secured Credit Builder Visa® Credit Card||Extra Debit Card5|
|Minimum Deposit||No Minimum2||No Minimum|
|Initial Credit Limit||Depends on how much you move from your Chime Checking Account||Depends on your bank account balance and other factors|
|Monthly Fee||None||$8 or $12 per month, depending on which plan you choose|
|Minimum Credit Score to Apply||None; no credit check is required||None; no credit check is required|
|Other Requirements||Applicants need a Chime Checking Account and a single $200 qualifying direct deposit4||Applicants will need a compatible bank account|
|Foreign Transaction Fee||None||None|
|Rewards Program||No||Yes, for the Rewards + Credit Building plan|
|Helps Build Credit||Yes, with reporting on-time payments to all three major credit bureaus||Yes, with reporting to Equifax and Experian|
Chime’s Credit Builder Credit Card could be the best secured option if you:
- Have a limited credit history and your main goal is to start building good credit scores1
- Are looking for a secured credit card with no minimum security deposit requirement2
- Don’t want to pay interest on purchases or annual fees
- Want to be able to control what you spend, with no pre-set spending limit
- Have a Chime Checking Account or plan to open one
- Are not concerned with earning rewards
The Credit Builder Secured Credit Card has the edge over the Extra debit card since it reports to all three of the credit bureaus. It also doesn’t have an annual or monthly fee.
So, is there any scenario where the Extra debit card could be a better fit?
The rewards program might be tempting, but it’s essential to consider the monthly fee. If you can’t earn back enough in rewards to cancel out the $12 you’ll pay for the card each month, then it likely isn’t worth it.
How quickly does Chime build credit?
The time it takes you to start to build credit with Chime can depend on how often you’re using your Secured Credit Builder Visa® Credit Card. Generally, you may begin to see an impact on your scores in as little as one to two months, though it can sometimes take longer to see a noticeable increase in your scores. Based on an Experian® study, members saw an average credit score increase of 30 points after 8 months.7
What is my Chime credit limit?
There is no pre-set spending limit for the Chime Secured Visa Credit Builder Credit Card. The amount you spend is determined by how much money you move from your Chime Checking Account to your Credit Builder secured account. There is no minimum security deposit requirement² either.
Does the Extra card report to TransUnion?
At this time, the Extra debit card does not report your account activity to TransUnion. The card does, however, report to both Equifax and Experian.
Using credit cards to build credit can be a convenient way to establish a credit history. Paying on time and keeping your balances low can help establish a solid foundation for a healthy credit score.
Chime’s Secured Credit Builder Credit Card helps make it easier to build good credit without high fees or interest charges.¹ The Extra debit card can help you build credit while also earning back a percentage of what you spend in rewards. Ultimately, the best secured credit card for you is the one that offers the smoothest path to building good credit.
Already have a Chime Checking Account? All you need to apply for Chime Credit Builder is a $200 qualifying direct deposit.