Chime Credit-Building Myths: Busted

If you’re a long-time debit card user, you might be concerned about using a credit card – and that makes sense.

Some credit cards with high spending limits can make it tempting to spend more money than you should and slip into debt. At the end of 2022, Americans collectively shared $930.6 billion in credit card debt.³

Debit cards, on the other hand, only allow you to spend money you already have in your Checking account. There is often no debt risk (unless your bank allows overdrafts on debit and you don’t pay it back). The tradeoff? Debit cards don’t allow you to build credit.

But what if you use Chime Credit Builder?

Chime Credit Builder is a safe way to build credit

hime Credit Builder is a secured credit card that reduces the risk of overspending. With Credit Builder, the amount you move into your Credit Builder secured account from your Chime Checking Account is the amount you spend – you’re in control!

With the Safer Credit Building feature, the money you previously added can automatically pay your monthly balance – and after some time, you should see an improvement in your credit scores.⁴

And for all you debit card stans out there, you can even use your Chime credit card to withdraw cash at an ATM, just like a debit card. As long as you make the withdrawal at one of Chime’s 60,000+ fee-free ATMs, there are no fees or interest charges.⁵

Committing to a credit card is a big deal. You should find one that you can use responsibly at all the places you love (and need) to spend money.

But some people think they can only use secured credit cards, such as the Chime Credit Builder card, at certain places. Is it true?

And should you use a credit card when you’re making a big purchase, and are worried about paying it back?

You can use Credit Builder wherever Visa® is accepted, for whatever you like

We might call our card the Credit Builder conversationally, but its full name is the Chime Credit Builder Visa® Credit Card – and that’s important.

Because we’ve partnered with the Visa payment network, you can swipe your credit card – or use it digitally – at any merchants that accept Visa credit cards.

Visa is one of the world’s most widely accepted payment networks. You can use Visa cards in more than 200 countries and territories at more than 80 million merchant locations.⁶

Plus, if you think credit cards shouldn’t be used for large purchases, rest easy. Since you are using your own money and determining your spending limit, you don’t have to worry about not being able to pay it back at the end of the month.

If you’ve been brushing up on how to improve your credit score, you probably know that credit utilization – how much of your available credit you actually use – is one of the factors that the credit bureaus consider when calculating your score.

That would seem to mean that the more you swipe your credit card, the higher your credit utilization will climb and the lower your credit score will drop.

Does that apply to the Chime Credit Builder credit card?

You can use your Credit Builder card as much as you’d like without impacting credit utilization

Traditional unsecured credit cards have preset credit limits, and most secured credit cards only let you spend up to the value of your initial security deposit.

The Chime Credit Builder Visa® Credit Card is different. There’s no preset limit. You can add as much or as little money as you’d like to your Credit Builder account.

That means Chime doesn’t report on credit utilization to the credit bureaus, no matter how much you spend. 

Remember, on-time payments are one of the key factors of healthy credit. If you’ve turned on the optional Safer Credit Building, which automatically pays off the card with the funds you’ve deposited in the account, you don’t have to worry about missing a payment each month.

Starting your credit journey can be hard. Lenders want you to have a good credit score before they approve you for a credit card, but a credit card is helpful for improving your credit score.

Catch-22, huh? Borrowers with bad credit or no credit may feel discouraged. Can they qualify for a credit card, or is it not worth their time?

Chime doesn’t run a credit check when you apply for Credit Builder, so borrowers with poor credit – or no credit – can apply

It may be more challenging for borrowers with a bad credit score or no credit history at all to get approved for traditional unsecured credit cards, but many secured credit cards, like Chime Credit Builder, are designed to help you establish credit history and improve your scores.

That’s why Chime doesn’t run a credit check when you apply.

And to help out members who are new to credit or who have had negative experiences in the past, we keep things easy: no annual fees, no interest⁵, and no minimum security deposit required.⁷

You might’ve heard of people carrying high outstanding balances on credit cards who are unable to pay off the debt.

But what about with secured credit cards like Chime Credit Builder?

Chime makes it easy to pay off your Credit Builder balance

With Credit Builder, you can only spend up to the amount already moved into your account. You control the spending limit on your credit card!

Each month, the money you already added to the secured account can be used to pay off the card – taking your unpaid balance down to $0. If you enable Safer Credit Building, this payment will happen automatically.

Then you can simply move more money into the Credit Builder account and start spending again. You can even opt into Move My Pay so that a portion of your direct deposit paycheck automatically goes into your Credit Builder account every payday, which is the easiest way to keep Credit Builder funded.

If you’re used to the familiarity of your neighborhood bank, where you can chat with a teller whenever you have a question, you might be intimidated by the thought of an online-only financial technology company.

Will you get the same level of customer service if everything’s digital?

Chime is available around the clock to help you out

If you have questions about any Chime product – Credit Builder, the Chime Checking Account, or the Chime Savings Account – a real human is here to help 24/7.

Wondering how to contact Chime customer service? You can chat with us in the app, give us a call, or shoot us an email, no matter what time it is.

The Chime Credit Builder Visa® Credit Card isn’t like traditional credit cards, and it’s even different from other secured credit cards.

With the built-in tools, cardholders can use Credit Builder to improve their credit scores, shop wherever Visa is accepted, and even take out money at an ATM.

Ready to improve your credit scores? Set up a qualifying direct deposit with Chime to apply for Credit Builder and start building credit – with your own money!¹