Easiest Credit Cards to Get
In most cases, anyone that has a short credit history or bad credit, as shown by a low credit score, can hardly qualify for their next credit card. The situation becomes much more difficult for those who attempt to obtain their first credit card but do not have a good credit history. Nonetheless, certain credit cards are easier to get than others. There are some cards for beginners who are trying to build a good credit record.
In this post, we provide some useful information about credit cards. We also offer you various FinTech companies and financial institutions that provide credit cards that you might be able to get your hands on easily.
What is a Credit Card?
A credit card is not just a rectangular piece of plastic or metal that is typically swiped, tapped, or inserted into a card reader to pay for new purchases. It is issued by a financial institution, usually a bank. A credit card allows the cardholder to borrow money from the institution that issued it. In that way, it allows the cardholder to pay for products and services at merchants that accept payments via cards. During the issuing of the card, the cardholder agrees to repay the money with interest according to the terms of the institution.
Credit cards that use near-field communication and other similar trending technologies to make contactless payments are available today. Examples include those issued by CapitalOne, Klarna, and AdvCash. Also, as a result of the digital transformation in banking and payments, it is now possible to store your credit card information on an electronic wallet (e-wallet) or bank app and make payments without handling your card.
Secured vs. Unsecured Credit Cards
There is a clear difference between secured and unsecured credit cards, even though they work the same way at retail stores.
To begin with, secured credit cards are covered by a security deposit that can be refunded. This lowers the lender's risk, making it simpler for those with no credit or poor credit, to apply for credit cards. Secure cards are less difficult to obtain than unsecured cards, which, on the other hand, do not demand a deposit.
Secondly, a secured card's credit limit is normally equivalent to the security deposit. So, your limit increases as your security deposit grows. But concerning unsecured cards, the issuer establishes your credit limit based on your credit history and the information you provided in your application.
Lastly, if you eventually stop making your monthly repayment, the secured card issuer may cancel your account and take your security deposit to repay the outstanding amount and costs. On the other hand, an unsecured card issuer may sue you for the balance owed.
Secured credit cards are a popular way to establish or rebuild credit, but they are not in any way better or worse than unsecured cards when it comes to your credit. The real determinant of your credit rating is your credit history, which tells whether you are good at using credit cards or not.
Credit Card Approval Requirements
Credit card issuing companies have different requirements for application approval. When you apply for a credit card, the issuing company will try to find out whether you can be trusted to pay back the loan on time. For this reason, it may ask for the following information:
- Your credit rating or score. Note that different countries have their own credit rating systems. For example, the U.S. and the U.K. use their own scale of scores. In the US, the most popular rating systems are FICO and VantageScore. They use the same range of scores, which is between 300 and 850 points. Depending on the number of points, your chances of getting a credit card can be from “poor” to “exceptional”. In the UK there are three top credit rating agencies: Experian, Equifax, and TransUnion. Their scores range from 721 to 999, 380 to 700, and 566 to 710 points, respectively. Using this system, your rating can be one of any of these categories: fair, good, or excellent. To show you an example of how a range of credit scores are categorised, here is that of the U.S.:
- 300 to 579 = Poor
- 580 to 669 = Fair
- 670 to 739 = Good
- 740 to 799 = Very good
- 800 to 850 = Exceptional
- Your occupation, that is, details about your current work or educational involvement.
- Your earnings—weekly or monthly income.
- Your rent or mortgage payment, which is due every month.
The above factors help the issuing company ascertain whether approving your application for a credit card will be a wise business decision or not. They provide card issuers with an estimate of your capacity and likelihood to repay credit card debt. Credit card providers can also do a rigorous investigation of your credit report to find out more about your credit history. Have in mind that this might lower your credit score by some points if they find reasons to doubt your eligibility.
Easiest to be Approved
Credit cards that are easy to approve are those that come with security deposits for those that can afford them or have requirements that are not difficult to meet. They include secured credit cards and those for students and starters. We will now tell you more about them.
Secured credit cards
Therefore, when comparing secured credit card choices, look for cards that do not impose fees. Look for companies that provide chances for credit line expansions or improvements.
Student credit cards
Student credit cards are for college students who are just starting to build a credit history. They are usually easier to obtain than conventional credit cards. To receive a student credit card in your name, you must be of legal age which is 18 in many countries, including Europe and the United Kingdom. However, in the United States, you have to be at least 21 to get a credit card with a good limit.
Although some student credit cards provide rewards, you should also search for cards that include instructional tools and incentives for responsible credit usage. When you are ready to upgrade to a card with greater rewards or advantages that are more suited to your spending, go for those with automatic credit line evaluations and credits for responsible use. Thus, you can develop the habits necessary to maintain a decent score over time.
Starter credit cards
Starter credit cards are available for people who are new to credit but aren't necessarily students. Annual fees and a higher annual percentage rate (APR) are more likely to be charged on these cards.
Now, irrespective of the above categories, the best banking and financial service providers with the easiest to approve credit cards are those listed below. You can click on any of them to find out more information about them as well as their latest requirements for an easy credit card application.
Easiest to Get with No or Thin Credit
No credit indicates you have no credit history, whereas thin credit means you have some credit history but not enough to create a credit score. In any instance, you are unlikely to receive credit card approval from card-issuing corporations when you apply. As a result, the easiest credit card to obtain may be a secured or starter credit card.
Here is an example of such a credit card for people with no credit or thin credit:
Through the Varo Believe Program, you can get one of the best-secured credit cards on the market. It has no minimum security deposit, which makes it different from a conventional secured credit card. Instead, you set your own Varo Believe Card spending limit. This limit depends on the amount of money you have transferred to your Varo Believe Secured Account from your Varo Bank Account. Try Varo today.
Easiest Unsecured Credit Card
No cash deposit is required to get an unsecured credit card. It is what people often refer to when they say they have a credit card. Even if your credit score is between poor and fair, you can still obtain an unsecured credit card. Below is a good company for you.
CapitalOne offers three ways in which you can easily get an unsecured credit card. The first option is to apply for a student credit card, which you can use to make online and in-person purchases. You can enjoy using this card with no annual fee, no security deposit, added security through card lock, and the possibility to get cashback.
The second option is to obtain authorisation to use someone else’s unsecured credit card account. This person could be your parent, who already has good credit. You can get them to add you as an authorised user of their account and probably be issued your own credit card.
The third option is to get a Capital One secured credit card that comes with a deposit requirement, use the card responsibly and gradually build credit, refund your security deposit after a while, and apply for your unsecured card.
How Can I Build Good Credit?
The short and simple answer to this question is: use your credit card responsibly. That is the only way you can build good credit. It also comes with the advantage of being able to avoid interest charges.
You need to use a small fraction of the credit you have in order to keep the balance on your credit card lower than your credit limit. This system is used to calculate your credit utilisation ratio, which further affects your credit score. If you want to calculate it yourself, you should use your credit limit to divide your credit card balance. The best way to manage your credit utilisation ratio is to ensure that it does not go beyond 7%.
Furthermore, we advise you to use your credit card to help your credit score. Locking up your credit card in a physical safe or keeping it at home does not in any way help you. It would rather make your issuing company close your account, and this is something to avoid. Therefore, use your credit card regularly but ensure you pay off the balance on time. If you develop this habit well enough, you will be able to convince future lenders that you are a good credit manager and are qualified to receive a credit card from them.
Bonus Note on Credit Cards
As of December 2021, the number of credit cards in use worldwide was around 2.8 billion. This means that if we were to operate under a global financial policy of one credit card per person, about 35% of the population of the world would be credit cardholders. But that is not the case. Still, the number of credit card users is expected to significantly increase by the end of 2022.
Meanwhile, the leading issuers of credit cards being used all over the world are Visa and Mastercard. While Visa owns about half of the global credit card market share, Mastercard comes second in rank with about 30%. So, if you own or used to have a credit card, there is a high likelihood that it was issued by Visa or Mastercard. Still, there are other noteworthy issuers in the credit card industry. They include American Express, UnionPay, Maestro, and Discover.
It is expected that credit card issuing companies will remain a major player in the transformational changes in payments. Financial analysts forecast that more than a third of in-store retail transactions in 2022 will be done using credit cards. Furthermore, by 2025, the credit card business would have grown to $107.69 billion at a CAGR of 1.1%.
No matter the kind of credit card you apply for, let your focus be on using it in ways that can help you develop healthy credit-building habits. This will help to keep your finances in good shape and create long-term credit. Paying your bills on time, keeping your credit usage low, and not spending what you know you cannot afford to pay off immediately can help you build a solid foundation for future credit usage.