How To Build Credit Without A Credit Card?

How To Build Credit Without A Credit Card

Planning to get a new credit card and don’t have sufficient credit to get one? Are you thinking of improving your credit? If yes, then let me tell you how you can build your credit without a credit card. 

One can build credit in many ways without a credit card. While the most commonly known way is to take a personal loan or a loan for credit building, there are many other ways to grow credit. However, one must choose the credit building way that suits him the best. 

Let me explain you some of the ways that you can follow to build your credit without a credit card: 

7 Best Methods To Build Credit Without A Credit Card:

Let me enlighten you with the ways of building credit without using a credit card. New users can apply these methods. Also, people who have a poor credit record can follow any of these methods to overcome the situation. 

Here are the 7 methods that you can follow to build credit even if you don’t utilize a credit card:

1. Apply For A Credit-Building Loan:

Taking a credit builder loan is the easiest and a common way to build your credit. A credit loan is not like a general loan. Here, the lenders would give you an amount as a loan, generally between $300- $1000, and deposit the amount to a secure account. 

In contrast to general loans, here, you are not allowed to use the money immediately after you get the loan. Here, the system is that first, you have to pay back the full amount through monthly installations. Only then, you can access the loan amount. 

It is an efficient way of credit building as you pay back the money via regular installations on time without spending extra. This record would be added to your credit record and passed on to credit bureaus. In this way, your credit would go up. 

2. Take A Personal Loan:

You can request a personal loan to a bank and by paying back the amount on time, you can enhance your credit record. 

Note that personal loans come with considerable APR. If you can’t pay the loan amount fast, it would be a burden for you. But if you can manage to pay quickly, it would add value to your credit and credit report. 

If you can’t pay back the amount fast, you can choose a credit-builder loan over a personal loan as the APR is less here. 

3. Apply For A Car Loan:

You can consider applying for a car loan only if you can keep paying the installations on time. On-time payment would help you to enrich your credit record. 

You can’t take cash to use this benefit. So make sure that you choose a plan that won’t charge a high APR. Otherwise, it would be difficult to pay back the amount. 

4. Pay Back The Loans:

Do you have an existing loan? If yes, then you already have a chance to improve your credit by paying back the due amount and getting rid of the loan. 

You may have taken a student loan, house loan, car loan, etc. that you haven’t paid back yet. If you are willing to improve your credit rating, it is important and useful to repay the loans on time. 

5. Report The Regular Payments:

Do you report your regular payments to credit companies? I assume you don’t because most people are not aware that this can improve their credit rating. 

You must be paying some bills each month on a regular basis. You pay electricity bills, telephone bills, Internet bills, house rent, and so on. Now, when you responsibly pay certain bills each month, this regular payment record can enhance your credit record too. So, you already have an opportunity right there to build credit. 

Tell the authorities (to whom you pay the bill) to report your details to the credit companies. You may also directly get in touch with a company. 

6. Get A Secured Credit Card:

While most people apply for an unsecured credit card, you can go for a secured credit card. With a secured credit card, you need to make a deposit. The amount you deposit is equal to your available credit. 

It means that you spend your deposit (credit) when you make a purchase without any risk of debts or late payments. This ultimately benefits your credit rating as you only get to spend the amount you deposit. 

7. Be An Authorized Card User:

There are credit companies that allow adding authorized users. Authorized users are those who don’t own an account but get a credit card and can access the credit of another cardholder. 

By doing this, you can use the card just as you would have used your own card. All your credit card activities would be added to your credit report. But if the cardholder fails to pay back on time, your credit rating would be affected. 

Can You Build Credit Overnight Without A Credit Card?

I can’t say you can improve your credit overnight. But you can definitely make a difference in your credit rating if you regularly follow some simple steps. The day you start applying these tactics, you can start building your credit:

  • You must check your credit report and try to get rid of all the negative points mentioned there. 
  • You must pay your bills regularly and report the data to credit companies.
  • You can sign up as an authorized user to improve your credit. 

These are the best ways to improve your credit report gradually but actively.


If you are responsible and disciplined about your money, you can grow your credit eventually. You may follow multiple ways together to get a better result. However, if you are taking loans, be attentive about paying back on time. Scrutinize the associating factors before deciding. 

So, which method are you going to follow to build credit without a credit card? 

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