Jonathan Halloway

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Products Updated April 19, 2018

Prepaid Cards For Building Your Credit Rating

We have listed all the best pre-paid cards for people with either no credit rating, a history of bad credit or who has a low credit score. Simply choose a pre-paid card and click through to apply direct with the card issuer.


How do this cards benefit me if I have poor credit?

Have a poor credit rating that you want to improve? There is a range of ways that you can do this, and an increasingly popular method is to use a prepaid credit card for bad credit to help you improve your score through careful payments of a fee. It is easy to do, and many people find using this method to rebuild their score much easier than taking out a rebuilder loan, for example, or doing other things to help get them back into a standard credit rating. The biggest advantage is to those who have seriously damaged their credit score through defaulting, CCJs or bankruptcy judgements against them. If you fall into this category, then you could certainly benefit from using a prepaid credit card to rebuild your score.

What are the advantages?

The prepaid credit cards which are used to help rebuild your score have been specially designed to assist you in getting the score you need. They may be able to help you by ensuring that you provide a completed 'loan', which has no missed payments. The prepaid card company will update your credit history to reflect that you have had this card, and have repaid the amount owed over the 12-month period required. This score will then be noted by other lenders performing credit checks on your account, and it will show them that you can commit to some kind of repayment schedule. There is, of course, also the benefit of allowing you to have a card which acts very much like a credit card, and will allow you to shop online or in a supermarket, take money from an ATM, and conduct transactions just as you would with any other kind of card. By using the card to help you budget, you can also benefit from learned financial experience, so that you do better in the future when you get a new card.

Is the prepaid card the best way of enhancing my credit?

The best way to improve your credit score will depend very much on how bad that score is. If you have had a complete disaster with your finances over several years, then it might take more than a year to improve that score. However, most people simply have bad credit due to changes in their life, minor missed payments, and overzealous debt collectors. If your credit score is not too bad, then there are things that you can do to help it along. You might add your name to the electoral roll, install a landline phone rather than using your mobile, or check to ensure that past accounts are not left open.

There are also other ways to improve your credit score, including borrowing money in other ways to enhance your credit. In addition, there is no assurance that you will be able to improve your score using these prepaid cards, since lenders may not take that into account, or consider it relevant. They are looking for risk criteria, rather than checking the actual history of your credit. However, using these prepaid cards can boost your general attractiveness, particularly as it enhances your reliability and can reassure lenders that you are ready to improve and are in control of your finances.

How do I apply?

If you are still interested in getting a prepaid credit card to improve your bad credit, then there are several steps that you can take. There is no credit check on these cards, because you are buying them to improve your score. However, you do have to be able to prove who you are, must provide ID and documents, including driver's licence, bank statements or council tax bills.

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