Best Credit Cards to Build Credit

Do you want to know your credit ratings, how to build them with credit builder cards, and some expert tips on choosing providers?

Read on as we walk you through everything there is to know about bumping up that credit score with some of the best credit builder cards on the market.

Credit Rating: What is it, and How to Check it?

Your credit rating measures how reliable you are as a borrower and how likely you are to repay your debts on time. Lenders use your credit record to assess whether to approve your credit applications, such as a credit card, loan, or mortgage.

​​Based on your credit history, your rating is impacted by your previous credit applications, payment history, and current credit balances.

Maintaining a good credit rating is essential to access credit when needed and on favourable terms.

​​How to Check Your Credit Rating

Checking how your credit looks is easy and accessible in the UK.

You can check your rating with one of the three leading credit reference agencies: Equifax, Experian, and TransUnion. 

Here is a simple how-to guide on checking your credit file:

1. Visit one of the credit reference agency websites (Equifax, Experian, or TransUnion).
2. Sign up for a free account and provide your details, such as your name, address, and date of birth.
3. Once you have signed up, you can access your credit report, which shows your credit history and rating.
4. Review your credit report carefully, checking for any errors or inaccuracies that could negatively affect your credit record.
5. If you spot errors, contact the credit reference agency to request a correction.

If you want a credit report, we have plenty more information on our website to help you gather all the details regarding your financial situation!

What if I Have a Bad Credit Score or None at All?

Understanding your financial situation is essential, as it may need to be clarified initially.

Your credit rating is usually expressed as a number or score within a range. Each credit reference agency has its scoring system, so your credit score may differ slightly depending on which agency you check it with.

Generally, the higher your rating, the more likely you will be approved for credit applications. A good rating is above 720 (out of 999) by Equifax and above 961 (out of 999) by Experian.

What Does Bad Credit Have an Impact on?

Having bad credit can impact you in more ways than you think. Getting approved for financial elements like loans, including personal loans, auto loans, and mortgages can be challenging. If you get approved, you may be subject to higher interest rates and less favourable terms, which nobody wants! 

Similar to loans, having a bad credit score can result in the rejection of credit card applications, especially those with low-interest rates and attractive rewards programs. Getting a credit builder card is your best option for improving your chances of grabbing those good rates!

Something you may have yet to think of when on the topic of bad credit is Employment opportunities. Some employers may run credit checks as part of their hiring process, and having a bad credit score could impact your ability to get hired for specific jobs.

Another popular reason for wanting to get rid of that bad credit score looming over you is housing arrangements—wanting to move out with a partner? Improving your bad credit is one step you must take between leaving home and getting those new keys!

How to Build Credit with Credit Building Cards

A sound credit file is crucial for accessing credit when needed and indicates financial responsibility, which can help you in other areas of your life, such as when renting a property or applying for a job. 

Here are some innovative strategies to improve your credit score:

Use credit responsibly.

Using credit responsibly is a critical factor in improving your credit score. This means paying your bills on time, keeping your credit balances low, and only applying for credit when you really need it. Avoid taking out payday loans or other high-cost credit products, as they can negatively affect your credit score and suggest that you struggle financially.

Stay on the electoral roll.

Being on the electoral roll is important as it shows lenders that you are a stable resident. Ensure you are registered to vote at your current address and keep your details current.

Check your credit report regularly.

Checking your credit report regularly will help you spot any errors or inaccuracies that could negatively affect your credit score. If you spot any errors, contact the credit reference agency to request a correction.

What is a Credit Limit?

A credit limit is the maximum amount of money that a lender is willing to lend to a borrower on a credit card or line of credit. 

The lender determines the credit limit based on your credit history, income, and other factors affecting your ability to repay the debt.

Once a credit limit is established, you can use your credit card or line of credit up to that limit. For example, if you have a credit limit of £5,000 on your credit card, you can spend up to £5,000 on purchases, cash advances, or balance transfers.

It's important to note that exceeding the credit limit can result in fees and penalties and negatively impact your score. Therefore, it's crucial to keep track of the credit limit and stay within the limit to avoid any adverse consequences.

Declined a Mainstream Credit Card?

Your past application for a mainstream credit card may have been declined.

If you find yourself in this situation, asking why your application was not approved, we've compiled a short list of reasons that can cause this to happen. 

• Past debt problems could be the root of the rejection.
• Holding a record of past borrowing or credit card activity can prevent applications from being declined.
• Applications can be declined if you have had an Individual Voluntary Arrangement or been made bankrupt in the previous six years.
• County Court Judgements against your name can cause the failure of your application for a mainstream credit card.
• Your application can only be accepted if you are on the electoral roll.
• Unpaid pills, both in your name or in a joint account with someone else, are a common reason these applications are declined.

If you have been declined when applying, a credit builder credit card may be the perfect way to kick-start your journey to financial stability and a great credit score!

Credit Union Loans

Suppose you're in the position of looking for your options surrounding loans and are worried about your credit score impacting this. In that case, you may be able to reach out to the Credit union, although they also have an eligibility checker.

How to Get a Credit-Builder Credit Card

To get a credit-builder credit card, you must first apply. Applications are simple and accessible online at your disposal. 

Most providers will first offer the chance to fill in a card eligibility questionnaire crafted to determine whether you will succeed in your application or be declined. This is a great way to check in on the chance of being accepted, and it doesn't impact your credit rating.

Read our article on getting your first credit card for expert tips and advice.

Who are the Best Credit Builder Card Providers for You?

Different credit builder cards have elements to suit people in their personal experiences. Later on, we will list the best credit builder credit cards, how these credit builder cards work and what they offer, but before you choose which provider to go with, you first need to understand the common incentives and what you would like.

Some incentives for choosing certain credit card providers can be low credit limits, as this will make it easier for you to manage your spending. For example, Aqua offers this and offers a mobile app that allows you to manage your account and track your spending. A great way to keep on top of your money!

Cashback rewards are another excellent incentive for choosing a provider. Capital One offers cash back rewards and no foreign transaction fees, making them a good option if you travel abroad often.

An initial high APR (annual percentage rate of charge) is available with providers such as Vanquis. A high APR means you'll be paying more interest charges on your outstanding balance, which can make it harder to pay off your debt and keep up with your payments.

If used responsibly, these cards are a fantastic way to improve your poor credit history and qualify for better credit products in the future.

Some cards come with features such as contactless payments and fraud protection, making them a safe and convenient option for everyday spending. Barclaycard, for example, can offer this safety.

Even the place where you do your weekly food shop may impact your choice of credit card provider, cards from Tesco Bank offer cashback on eligible purchases, have no annual fees and are a good option for people who shop at Tesco and want to earn rewards on their spending.

Understanding the incentives of different providers will unlock more benefits for your financial future!

Does a Credit Builder Card Help if I Have Bad Credit?

While the short answer is yes, we're here to give you an expert explanation of credit builder cards and the world of direct debit, so let's dive into this a little bit further.

The sole purpose of a credit builder card is to help you build your credit score over time by using it responsibly, so it's difficult to suggest any evidence against it helping your poor credit history!

By using a credit-building card and making your minimum monthly repayments, you can demonstrate to lenders that you're a responsible borrower. 

From accessing other credit products, such as personal loans, mortgages, or traditional credit cards, to better interest rates and higher credit limits, building up your poor credit score with credit builder cards is a foolproof tactic!

Although it is important to note that this isn't a quick fix for bad credit, it is your responsibility to be consistent with taking care of your financial decisions in order to see significant improvements in your credit score.

Weighing up the Pros and Cons of Using Credit Builder Credit Cards

Credit builder credit cards can be a useful tool for building or rebuilding your credit score, providing you with access to credit and helping you manage your spending. 

Here's a summary of the pros and cons of using a credit builder credit card:

Pros of Using A Credit Builder Card

✔️ Credit builder credit cards are an excellent way to establish a credit history, especially if you have little to no credit history.

✔️ Consistent and responsible use of a credit builder credit card can help improve your credit score over time.

✔️ Credit builder credit cards can be easier to obtain than traditional credit cards, which may require a good credit score or income.

✔️ Some credit builder credit cards have low fees, making them affordable for those who are trying to establish credit.

Cons of Using Credit Builder Cards

❌️ Credit builder cards often have higher interest rates than traditional credit cards, which can lead to expensive interest charges if you carry a balance.

❌️ Credit builder credit cards often have lower credit limits, which can limit your purchasing power.

❌️ Credit builder credit cards typically offer limited rewards, such as cashback or points, which may not be as attractive as rewards offered by other credit cards.

❌️ If you're not careful, using a credit builder credit card can lead to overspending, which can negatively impact your credit score and financial well-being.

8 Best Credit Building Credit Cards

Building credit is an essential step towards achieving financial stability.

One effective way to do this is by using credit cards responsibly. Here are 8 of the best credit cards to build credit:

1. Barclaycard Forward Card

This card offers a lower credit limit and is designed for students or those with limited credit history. It also offers cashback rewards for responsible use.

Barclaycard Forward Card

Credit Limit

Minimum £50

Representative % APR (variable)

33.9% APR

• 0% interest on purchases for 3 months (from the date you open your account).
• Credit limit £50 to £1,200.
• No annual fees.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 33.9% p.a. (variable) your representative APR will be 33.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

2. Tesco Bank Foundation Credit Card

This card is designed for people with poor credit scores and offers a relatively low credit limit. It also offers Clubcard points for responsible use. A fantastic option across credit builder cards.

Tesco Bank Foundation Credit Card

Credit Limit

Minimum £250

Representative % APR (variable)

29.9% APR

• Collect Clubcard points almost every time you shop.
• Credit limit £250 to £1,500.
• Access to Tesco Bank CreditView, provided by TransUnion, for 3 years from account opening.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 29.9% p.a. (variable) your representative APR will be 29.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

3. NatWest Credit Card

This card offers a higher credit limit and is designed for people with average or better credit scores. It also offers cashback rewards for responsible use.

NatWest Credit Card

Credit Limit

Minimum £250

Representative % APR (variable)

12.9% APR

• Low rates on purchases and balance transfers.
• No balance transfer fees.
• No foreign transaction fees on purchases.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 12.9% p.a. (variable) your representative APR will be 12.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

4. Aqua Classic Credit Card

This card is designed for people with poor or limited credit history and has a relatively low credit limit, making it easier to manage your spending.

Aqua Classic Credit Card

Credit Limit

Minimum £250

Representative % APR (variable)

34.9% APR

• Smart credit limits from £250 – £1,200.
• Build better credit with expert support in the Aqua app.
• Ability to build your credit score, if you manage your account well.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 34.9% p.a. (variable) your representative APR will be 34.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

5. Capital One Classic Credit Card

This card offers a low credit limit and has lower acceptance criteria, making it an excellent option for those with limited credit history.

Capital One Classic Credit Card

Credit Limit

Minimum £200

Representative % APR (variable)

34.9% APR

• For people with bad credit or building credit.
• Credit limit £200 to £1,500.
• Interest-free period up to 56 days on purchases each billing period for cleared balances.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 34.94% p.a. (variable) your representative APR will be 34.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

6. Vanquis Bank Classic Credit Card

This card offers a lower credit limit and is designed for people with poor credit scores. It is a good option for those looking to rebuild their credit. This is a very popular credit builder card.

Vanquis Bank Classic Credit Card

Credit Limit

Minimum £250

Representative % APR (variable)

39.9% APR

• Interest-free period up to 56 days on purchases each billing period for cleared balances.
• Credit limit £250 to £600 (subject to status).
• No annual fee.

Check my eligibility See more details

Representative Example – If you spend £250 at a purchase interest rate of 39.9% p.a. (variable) your representative APR will be 39.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

7. TSB Advance Credit Card

This card offers a higher credit limit and is designed for people with average or better credit scores. It offers cashback rewards and other benefits for responsible use.

TSB Advance Credit Card

Credit Limit

Minimum £500

Representative % APR (variable)

12.9% APR

• 0% interest on purchases for the first three months.
• 0% interest for the first three months on balances transferred within 90 days. 0% balance transfer fee applies in the first 90 days. After 90 days, a 5% fee will apply.
• Can be used with Apple Pay and Google Pay.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 12.95% p.a. (variable) your representative APR will be 12.9% APR (variable). Your APR and credit limit may vary depending on your circumstances.

8. Sainsbury's Bank Everyday Credit Card

This card is designed for people with average or better credit scores. It also offers Nectar points for responsible use.

Sainsbury's Bank Everyday Credit

Credit Limit

Minimum £1,000

Representative % APR (variable)

29.4% APR

• Qualify for a reduction in your APR.
• An initial credit limit between £1,000 – £2,000.
• Collect up to 3 points per £2 spent at Sainsbury’s, Argos, Habitat & Tu clothing when you pay with a Sainsbury’s Bank Credit Card & scan your Nectar card or app. And you’ll get 1 point per £5 elsewhere.

Check my eligibility See more details

Representative Example – If you spend £1,200 at a purchase interest rate of 29.4% p.a. (variable) your representative APR will be 29.4% APR (variable). Your APR and credit limit may vary depending on your circumstances.

What Other Types of Credit Cards are There?

The credit cards and providers that we have already discussed are your best helpers and tools to get you on the road to good credit, but we understand that not everyone is looking for these types of cards, so here's a rundown on a few other types that may pique your interest!

Credit builder cards not sounding like the choice for you, or don't have a poor credit history?

0% Purchase Credit Card

A 0% purchase credit card is a credit card that offers an introductory period during which you can make purchases and pay no interest on the balance. This means that if you pay off your balance in full within the introductory period, you will not be charged any interest on the purchases you made with the card.

These can be a good option for those of you who want to make a large purchase and pay it off over time without incurring interest charges. However, it's important to ensure you can pay off the balance within the introductory period, as the interest rate can be quite high once the promotional rate expires.

Cashback and Reward Credit Card

A cashback and reward credit card is a type of credit card that offers cashback or rewards points for making purchases with the card.

Cashback credit cards typically offer a percentage of the amount spent on purchases back to the cardholder in the form of cash rewards. For example, a card may offer 1% cash back on all purchases, meaning that for every £100 spent, the cardholder will receive £1 in cashback rewards.

On the other hand, reward credit cards offer points or miles for purchases made with the card. These points can then be redeemed for rewards such as travel, merchandise, gift cards, or statement credits.

For example, a card may offer 1 point per £1 spent on all purchases, and the cardholder can redeem those points for rewards such as airline tickets, hotel stays, or gift cards.

Balance-Transfer Credit Card

A balance-transfer credit card is a credit card that allows you to transfer the balance from one or more credit cards onto a new card, typically at a lower interest rate.

By transferring balances to a balance-transfer credit card with a lower interest rate, you can save money on interest charges and pay off your debt faster.

Read our article on balance transfers for a more in-depth explanation if this sounds like a good fit for what you want in a credit card!

Related Guides:

• How To Get Your First Credit Card: Tips & Advice
• Best Credit Cards for Bad Credit in the UK
• Can You Withdraw Money From A Credit Card?
• Best Credit Cards in 2023
• Best Business Credit Cards for Bad Credit