Best credit cards if you have a bad credit history

If you have a bad or non-existent credit history, these credit builder cards can help you get on the right track and boost your rating.

Credit builder cards are designed for people with a poor credit history and those that don’t have one yet.

These are typically bare-bones deals, which come with conservative limits and relatively high APRs to encourage good credit card spending habits.

Used properly, they can help you get on the right track so you can access more rewarding deals in the future.

You can also find some of the best frugal tips and latest money trends over here.

Don't take interest rates for granted

Keep in mind that you may be offered a higher interest rate than the one advertised.

Credit card companies only have to offer 51% of customers the advertised rate, and if you've got a poor credit history, you're unlikely to get it.

It's worth checking what the maximum APR is, as you'll only be told about your higher rate AFTER you've applied and gone through a credit check.

Top credit builder cards

Credit builder cards are typically no-frills, but some have 0% offers on new purchases or balance transfers, although this has become less common.

Instead, you’re more likely to get lower interest rates or a higher credit limit when you responsibly use your card.

Here are some of the best credit builder cards currently available:

As well as offering the lowest interest rate on our table, Tesco Bank will allow you to earn Clubcard points on your credit card spending.

The Barclaycard Forward Credit Card has a higher interest rate (33.9%), but you can get a 3% interest rate reduction if you pay everything on time and stay within your credit limit for the first year.

If you continue doing this for the second year, your interest rate will go down by another 2%, plus you get 0% interest on purchases for the first three months of card ownership.

If you’re more interested in a 0% purchase credit card, check out The best 0% purchase credit cards.

Cheapest credit builder cards

It’s worth noting that some of the credit cards mentioned above come with hefty representative APRs.

So, after the initial window has expired or if you don’t pay off your balance in full each month, you could find yourself paying an interest rate of over 30% on any outstanding debt.

If you're looking to keep the same credit card for a while, there are several cards with an interest rate of under 30%.

Golden rules

There are a couple of things to keep in mind when it comes to using credit builder cards.

First of all, make sure you read the requirements very carefully before applying. The last thing you want is to be rejected for a card and damage your credit rating even more.

You should check your likelihood of being accepted before you apply without impacting your credit score by using an eligibility checker.

Second, it’s vital you pay your balance in full every month if you can. Doing so will boost your credit score and you’ll avoid racking up interest at an extortionate rate.

How to check and improve your credit rating

One of the ways to check your credit rating on an ongoing basis is to use Clear Score. This free service gives you access to your credit rating, provides personalised product offers and coaches you on how to improve your credit rating.

There are other ways to improve your credit score, and some are relatively easy and free, such as registering to vote.

You can read more about credit scores and how to improve them here.

Still not found the right card for you? View our complete guide to credit cards to see all your options.

More on credit and debt:

How do I get out of debt? Cheapest ways to pay off what you owe