Author: Monique Crapper is a marketing strategist and copywriter with over 15 years of experience helping fintech brands grow and connect with their audiences. Known for combining data-backed strategy with authentic, human-centered storytelling, Monique crafts content that not only informs but also inspires action. Her work turns complex financial topics into engaging, accessible narratives that resonate with real people.

How to Build Credit Without a Credit Card

Not everyone has access to credit cards, and not everyone wants one. If you can’t access one or choose not to have one, it may feel like you’re locking yourself out of the credit system. However, it’s possible to build credit without ever swiping a plastic card. 

Here are practical tips to build credit without a credit card, whether you’re new to credit, rebuilding, or looking for safer options.

7 Proven Ways to Build Credit Without a Credit Card

While credit cards are one way to build credit, they’re certainly not your only option—and not always the most ideal—depending on your financial situation. These practical tips can help you lay a strong foundation for building your credit history without needing a credit card.

1. Become an Authorized User

One of the best ways to build credit without owning a credit card is to be added as an authorized user to someone else’s credit card account. This allows you to boost your credit through shared payment history. The best part? You don’t need to use the card yourself to reap the benefits. Your credit score improves as long as the primary account holder manages their account wisely.

2. Get a Credit Builder Loan

Credit builder loans are designed for individuals with little to no credit who want to build their credit history. Here’s how they work. You “repay” the loan in installments before getting the funds, allowing you to create a payment history while growing your savings. You can apply for these loans at credit unions, local banks, or online lenders.

3. Consider an Auto Loan or Personal Loan

Establish a credit profile through auto or personal loans. You can boost your credit over time by making consistent, on-time payments throughout your loan term. If you decide to go this route, consider current interest rates and down payment requirements, and only take out loans you’re confident you can repay.

4. Repay Existing Debts Consistently

Many assume larger debts from cars or personal loans are the only ones impacting their credit score. However, even small debts like buy-now-pay-later balances, old utility bills, unpaid medical bills, or phone financing plans can negatively affect credit if unpaid. Focus on paying off any open accounts and staying current with recurring payments.

5. Report Your Rent Payments

Rent payments often go unreported, but third-party services like Rental Kharma or PayYourRent can help add your positive rental history to your credit file. This is especially valuable if rent is one of your most significant monthly expenses.

6. Get Credit for Utility and Phone Bills

The fastest way to build credit is to use tools like Experian Boost, which let you include utility, phone, and even streaming service payments in your credit report. This is a simple way to leverage bills you’re already paying to build your score.

7. Use a Secured Credit Card (If Possible)

While it’s technically still a credit card, secured credit cards tend to be a lower-risk option. They require a cash deposit as collateral, which can be a safe way to build credit without overspending. This option is perfect for beginners and those trying to rebuild their credit.

Can You Still Have a Credit Score Without a Credit Card?

Yes, you can have a credit score without using a credit card. Your score is calculated using data from multiple types of credit, like loans, rent, and reported bill payments. These accounts can contribute to a healthy credit profile if reported to the major credit bureaus.

What Impacts Your Credit Score?

Your credit score is calculated using five key factors. If you want to learn how to build credit without a credit card, understanding them helps you focus on what matters most.

• Payment history is the most important factor. Making on-time payments shows lenders you’re reliable and helps build a strong credit profile.

• Credit utilization measures how much of your available credit you’re using. Keeping balances low, especially on revolving accounts, helps increase your credit score.

• The length of your credit history reflects how long your credit accounts have been open. A longer history, paired with timely, consistent payments, strengthens your profile.

• New credit looks at how often you apply for new accounts. Opening several accounts in a short time can lower your score, so space out applications and only apply when necessary.

• Credit mix considers the different accounts you manage. A healthy mix of credit types, like loans, rent, and utility payments, shows you can handle various responsibilities.

How to Start Building Credit from Scratch

If you have no credit history, figuring out how to build credit without a credit card may seem near impossible. Fortunately, building credit from scratch is doable with the proper steps and mindset.

Here’s how to get started:

• Check your credit report: Even if you think you don’t have any history, it’s worth checking. Sometimes accounts you didn’t know were being reported, like student loans or utilities, may already be helping you. Visit AnnualCreditReport.com to access your free report from all three bureaus.
• Start small and intentional: Instead of applying for multiple accounts, begin with one low-risk option that reports to the credit bureaus, like a personal line of credit from your bank.
• Don’t chase shortcuts: It can be tempting to open multiple accounts to “speed up” your credit growth, but instead, focus on one or two well-managed accounts and build from there.
• Consider a secured credit card or store card: If you’re ready to dip your toe into traditional credit, a secured credit card can be a safe start. You’ll make a refundable deposit up front and use it like a regular card. With responsible use, it can lead to an unsecured card later.

Getting started with credit is less about how much you borrow and more about showing you can borrow responsibly. Focus on consistency, keep your balances low or nonexistent, and aim to make every payment on time.

For organizations looking to support employees on their financial journey, Instant’s employee benefits are designed to promote smarter money habits from day one.

What Is the Fastest Way to Build Credit?

The fastest way to build credit is to combine multiple positive actions, like becoming an authorized user and opening a credit builder loan. These methods build payment history quickly and show lenders you’re trustworthy.

How to Build Up Credit Over Time

Building a healthy, long-term credit profile takes consistency. Pay your bills on time, avoid unnecessary debt, and maintain a healthy mix of account types. Your credit score will reflect steady progress over time.

Is a Cosigner a Good Option?

Yes, a cosigner with a good credit score is an excellent option if you’re having trouble getting approved for loans on your own. However, you should manage the loan responsibly since your actions will also affect their credit score.

How to Establish Good Credit Habits

Forming healthy credit habits early pays off in the long run. Practice these foundational behaviors:

• Always pay bills and loans on time
• Don’t borrow more than you can afford
• Avoid opening multiple accounts at once
• Keep outstanding balances low
• Monitor your credit report regularly

These steps work whether you have a credit card or not.

Check Your Credit Report and Monitor Progress

Reviewing your credit reports regularly is one of the smartest habits you can build, especially if you’re just starting to build your credit profile. Check reports from each of the three major credit bureaus (Equifax, Experian, and TransUnion) because they collect information separately, and your report (and score) might vary slightly between them.

Here’s what to check for:

• Personal information: Ensure your name, address, Social Security number, date of birth, and employment information are correct.
• Account details: Confirm that both open and closed accounts are yours, and verify that the payment history, balances, and credit limits are accurate.
• Credit inquiries: Ensure all inquiries listed are from companies you’re familiar with. If there are any you don’t recognize, this could be a sign of fraudulent activity.
• Collections: Check any accounts in collections, ensuring they’re yours and the information is correct.
• Public records: Verify that any public records, such as a bankruptcy, are yours and that the information is accurate.

If you spot an error, file a dispute directly with the credit bureau that reported it. Most offer simple online forms; they must investigate and respond within 30 days.

Avoid These Credit Mistakes

Credit mistakes can linger for years, so proactive management is key. Here are some of the common credit mistakes that may affect your score:

• Missing payments or paying late
• Maxing out secured credit cards
• Only paying the minimum balance on secured credit cards
• Applying for too many accounts at once
• Ignoring bills that get sent to collections
• Letting small debts go unpaid
• Ignoring your credit report
• Taking out cash advances

Empower Your Team with Financial Wellness

Financial wellness should be within reach for every employee. At Instant, we help organizations like yours deliver flexible pay solutions that empower your people to take control of their finances, including learning how to build credit without a credit card.

Request a demo today and see how Instant helps your team build brighter financial futures.