How Credit Reporting Works with Chime

Credit scores are calculated and reported by the three major credit bureaus: Equifax^®, Experian^®, and TransUnion^®.

All three credit bureaus receive information from your lenders each month, like your account balances, payment history (on-time, late, or delinquent), and the age of your account. The bureaus use this information to determine your credit scores.

Your credit scores are calculated using a variety of factors, each of which has a different “weight,” or importance for your score.

FICO^® scores, the most commonly used credit score, are calculated using the following formula:^3,4

• Payment history accounts for 35% of your score and tracks your history of on-time payments.
• Amounts owed is another 30% of your score, and tracks your credit utilization – how much credit you use versus how much you have access to.
• Length of your credit history accounts for another 15% of your score and refers to the average age of a credit account in your file.
• New credit counts toward 10% of your score and tracks the number of new accounts you’ve applied for or opened in the recent past.
• Credit mix counts for the last 10%, and favors those who have a mix of different types of loans (such as installment loans, credit cards, and mortgages) rather than just one or two types.⁵

The bureaus then use this information to update your credit history and score over time.

Note: Not every lender reports to all three bureaus, which is one reason you may sometimes see differences in your score depending on where you look.⁶

Chime reports the following to all three credit bureaus:

• Payment history, including both your on-time payments as well as any late or missed ones. That’s why we recommend turning on the Safer Credit Building feature to automatically pay your balance on-time each month with money you set aside in your secured account.
• Credit age, or the length of time your Chime account has been open. Remember, the longer your credit history, the better – it gives lenders a better picture of your financial habits over time.
• Current balance, including anything you currently owe as well as overdue payments. Having a current balance is normal.

Along with what we do report, there are a few things Chime does not report to the credit bureaus. These include:

• Your credit limit. Because Chime Card^™ doesn’t have a preset credit limit. Instead, the amount of money you have in your account doubles as a flexible “limit”.
• Credit utilization. Without a credit limit, there’s no way to calculate a utilization ratio – which means we don’t report one to the bureaus.

Why is this important?

Normally, with an unsecured credit card, high usage (typically 30% or more) can cause a drop in your credit score. But since we don’t report utilization on our secured credit card, your score won’t be negatively affected, even if you use all of the money in your account during the month. Just make sure to pay your balance on time.

Chime reports to credit bureaus at the beginning of the month, but the bureaus themselves can also take time to process the information. That’s why you might not see changes until a few weeks later.

Generally speaking, you should have an updated credit score at least once a month. However, the timeline isn’t always the same, especially if you have multiple accounts.

Each lender reports to the bureaus on their own timeline, and then the bureaus have to do the calculations. That’s why there can sometimes be a lag between credit activity and its effect on your score.

Building credit is a powerful key to unlock financial progress™, but it doesn’t always happen overnight. While some Chime members see fast improvements to their credit score, in other cases, it can take a little longer – but either way, it’s worth it.

The average Chime Credit Builder Secured Visa® Credit Card user sees an increase of 30 points to their credit score with consistent on-time payments.² That kind of increase can be a big deal. For example, if you started with a score of 650, a 30-point increase would push you from the “fair” category to the “good” category with a new score of 680.⁷

And if you keep up with good credit habits, you may see your score climb even higher.

The Chime Card makes it easy to build credit safely, unlocking the best of credit and banking.

If you’re ready to build credit with on-time payments without reporting credit utilization, learn how to get a Chime Card today. It only takes a few minutes, and there’s no credit check to apply!