Credit Builder Could Help A Poor Credit History

Credit builder could be a way for you to have a completed loan appear on your credit file without the risk of running up unnecessary debts.

People who have had little or poor credit history can often find it difficult to obtain credit as to lenders they are not seen as a particularly safe bet.

I found this out for myself when applying for a credit card.

I had no credit history as I thought by playing it safe and only spending what I had would stand me in good stead further down the line – how wrong I was.

I was continually turned down for credit for well over 3 years, to say it was frustrating was an understatement as in my opinion surely I was a safer bet than someone with a chequered credit past, especially when I saw people who had been, or still were in debt management programmes able to obtain credit with ease.

But, can a prepaid card with Credit Builder really have much of an effect on your chances of obtaining credit? Let’s take a look;


CashPlus and icount: What’s so special?

The CashPlus and iCount prepaid cards are pretty standard deals.

Just like other prepaid accounts on the market, cardholder can load money at any Post Office branch or via a BACS transfer and then spend it like you can on any debit card.

The card issuers make their money by charging a monthly fee on their Pay Monthly accounts or a transaction fee usually around 2.5% on their Pay As You Go accounts. They also earn from ATM withdrawals.

What makes these two different from other prepaid cards and useful to those with a damaged credit history is the credit building facility.

Credit Builder

The Credit Builder facility works like this:

  • Cardholders pay a monthly fee to hold the card
  • The fee must be paid for a full 12 months
  • At that point, the card appears as a completed loan on credit records

The cost of the two accounts are as follows:

Sign up fee Monthly Fee Annual cost
Cashplus £4.95 £4.95 £64.35
icount Money £4.95 £9.95 £124.35


Is it worth it?

That is the question on most people’s lips when looking into a product of this description as it is a cost and no actual means of credit is given to the consumer.

The benefits

Having a completed loan on your credit file is most certainly beneficial, especially with no missed payments.

To any potential lenders looking at your credit file it says “this person can manage their finances responsibly and is able to make payments on time and in full. They’re a safe bet”

Who wouldn’t want our credit reports to say that?

Are there other ways to improve a damaged credit score?

Yes there are a few simple things you can do to help improve or repair your credit score.

Check your credit file for any mistakes

Sounds simple right? But if there is any sort of mistakes on your credit file you will most probably be turned down by lenders. There are three main credit reference agencies I would recommend you check:

If you do spot any mistakes, challenge them by complaining to the credit reference agency.

They have 28 days to remove the information or tell you why they don’t agree with you.

During that time the ‘mistake’ will be marked as ‘disputed information’ and lenders aren’t allowed to rely on it when assessing your credit rating.

How to improve your credit rating – things you can do now

  • Stop applying for credit until you have ironed out any issues on your credit file and improved your credit score.
  • Get on the electoral register. If your name is not on there the likelihood of you obtaining credit is slim to none. Register online or by post.
  • Cancel unused credit cards. This will also reduce the risk of falling victim to fraud if they were to be stolen.

How to improve your credit rating in the longer term

If you have had previous debt, you need to show lenders that you are a responsible borrower. In time, this will improve your credit score.

Pay on time

Pay your bills on time and if possible settle credit accounts early. This will show you are sensible borrower.

Credit-builder credit cards

There are credit building credit cards available if you have a poor or no credit history.

Be aware that they come with very high interest rates, and if you go down this route you need to pay off whatever you spend in the same month to avoid having interest rates added to your monthly bill.

Otherwise you’ll get into debt that you may potentially struggle to pay off, reducing your credit score even further. Credit limits on these cards are typically low.

Stay away from expensive credit repair companies

These type pf companies claim to be able to repair your credit score. Most of them simply negotiate with companies who have sort County Court Judgements (or decrees in Scotland) against you.

Others may claim they can do things – legally they can’t, and some may try to encourage you to lie to credit reference agencies.

They charge a small fortune so DON’T consider using such firms. There is no reason that you cannot improve your credit rating yourself so don’t pay someone else to do it!

The Verdict

Credit Builder can be a good way of rebuilding your damaged credit history but it may not be right for everyone.

There are no credit checks for either CashPlus or icount prepaid card so by applying you’re more or less guaranteed to be accepted.

To be able to apply for  Credit Builder you must be a ‘Total Access’ customer for both accounts, meaning you will need to be able to provide certain forms of identification to prove who you are and where you live.

The documents you can provide are listed below:

A. ID – certified copy (NOT Originals): B. Financial statements – original: C. Other – original:
UK Driver’s Licence, Provisional or Full (both card and paper parts) Bank or building society statement Utility bill
EU Driver’s Licence Credit card/store card statement Council tax bill
Passport Inland Revenue/HMRC Correspondence (i.e. confirmation of tax code or NI number) Council rent card or mortgage statement
EEA member state ID card Tenancy agreement from a council or housing association
Home insurance certificate


As I am saving for a mortgage and I have very limited credit history (1 credit card for 4 months) I am going to seriously give this some consideration.

It is going to take me in excess of a year to save for my deposit so having as many positive footprints on my credit file as possible is only going to be beneficial when it comes to applying.

You can apply for CashPlus and icount prepaid cards by following these links*

Have you used Credit Builder? If so we’d love to hear your feedback.

The post was written collaboration with icount Money, the award winning prepaid account.

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David Naylor is the editor of the Thinking Thrifty blog. An award winning personal finance and lifestyle blogger, he shows how it is possible to live extremely well for less.
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