How to build credit without a credit card

The current U.S. credit card debt for the first quarter of 2025 sits at nearly $1.2 trillion dollars. Yet, about one in ten Americans is “credit invisible,” which means millions of people don’t have any credit whatsoever. No credit cards, no loans, no record with any credit bureau.

Credit is complicated and tricky to navigate if you don’t have it. Credit card debt, however daunting, does have a silver lining: the more you use it, the more credit you build, and that history has lasting positive impact over time. Credit building means helping you get other loans or achieving life events like getting a mortgage or other loans or even renting an apartment.

There are many other ways for people to build credit without spreading payments across several credit cards, including leveraging perks to help build credit. We’ll guide you through the specifics of why credit is important and other ways to build credit without a credit card.

Why credit building is important

Credit building tells the institution you’re borrowing from that you can, in fact, pay your bills on time and (eventually) in full. It futureproofs you for any new or additional loans. For example, you may need to take out a loan to pay for a car. Good credit standing means you’ll have more favorable credit terms and interest rates because you’ve done the work of paying against the credit you’ve built. 

A solid credit standing, often measured by a credit score ranging from 300 to 900, means you can qualify for other things like a mortgage, or show a potential landlord that you have the financial goods for payment. 

Credit is one snapshot in a large financial portrait. It’s much more nuanced than just good or bad credit. This can fluctuate. 

People get into good and bad credit all of the time. For instance, using your credit card consistently and paying at least the minimum amount can provide you so-called good credit. So-called bad credit, on the other hand, gestures toward financial irresponsibility, particularly if you’re not able to make payments on time. Why you can’t doesn’t mean you are bad, but the situation is. 

For the credit invisible, this puts them at a disadvantage for so much. There are a number of valuable reasons to not have a credit card, but this one way to build credit can leave them in the lurch for other opportunities and benefits. 

Do I need a credit card to build credit? 

The short answer is no, you don’t need a credit card to build credit. We’ll get to that later, but here’s the reason why many use credit cards to build credit. 

Having a long history of on-time monthly payments to your credit card will help you build credit quicker. 

People who have a strong credit history (i.e. a history of making credit payments on time) are seen as less liable to miss a payment, which makes things easier for the credit provider. 

There are quirks to using credit cards to build your credit. For example, applying for a new credit card can actually have negative initial effects on your credit score. 

There are other ways to build credit, especially if you’re currently unable to obtain one or don’t want to have one at all. 

Five ways to build credit without a credit card

Your credit score is almost like a muscle. It won't magically change overnight, but with the proper habits and some time, you will start to feel the positive impacts, like seeing your credit limit grow. 

Building credit without a credit card or bad credit history can feel intimidating, but it’s not impossible. If you’d prefer to build credit in other ways—don’t fret, there are plenty of options out there for you. 

1. Get credit for your rent

There’s a chicken and egg situation with rent and credit: you need it to rent an apartment but if you don’t have it from credit cards, how do you do it? 

There are many new companies, such as Boom, that help credit-invisible people with low credit scores report their rental payments to credit bureaus. For those of us who have always and consistently paid our rent in full and on time, this is an incredible opportunity to use this to our advantage and get meaningful credit as a result. 

ZayZoon offers access to Boom. Report your rental payments and increase your credit on average by 28 points in two weeks. You don’t need to use our earned wage access (EWA) payouts to get it. Learn about these perks and more. 

2. Get a secured credit card

A secured credit card is a fairly easy way to build credit. Users will essentially pay for the card upfront with a small amount—somewhere between $200 and $500. Their limit will be that amount and they can use it and pay the interest or pay it off altogether. The more use it gets, the more credit is built. 

Once the card becomes unsecure, or if a user decides to close it up entirely, that deposit is returned to them.

This is a great option for someone who primarily uses cash and has it on hand to make the deposit. Interest payments will still remain relatively low compared to cards with higher limits. 

3. Try a credit-builder loan

A credit-builder loan is a loan taken out specifically with the intent of paying it off to improve your credit. Credit builder loans,such as Kikoff, prove to credit bureaus that you can be trusted to make payments in a timely manner.

Unlike a traditional loan, you won’t receive the money upfront. With credit builder loans, you will determine the amount you would like to work towards and make payments until it's paid off. Once the loan payments have been made, you will then receive the full loan sum from the financial institution and a boost to your credit score.

Like all credit-building strategies, this won’t improve your score overnight, but a credit builder loan will provide you with an additional source of credit reporting. This can be used to improve your credit score over time to help secure a real personal loan. 

4. Pay loan installments on time

This one may seem a little obvious, but on-time payments are crucial to improving your credit, and forgetting to do so could end up costing you.

You likely already have some installment plan in place, whether it be credit card bills, mortgage payments or student loans. Staying mindful of them, especially as you look to expand your credit score efforts, is very important. 

One way to not miss upcoming payments? Earned wage access (EWA). Access your wages early to make payments when bills are due.

5. Become an authorized user

Many credit card companies allow additional users on a credit card. For example, if you’re in a household and one family member has a credit card, you can be added as an authorized user to that card and build credit for it. Activity and payments will be reported to credit bureaus. 

Keep in mind that whoever adds you as an authorized user to the card is financially tied to you and vice versa. You can impact each other’s credit. 

Financial wellness and credit building

Building good credit takes time. It’s important to remember that credit is a useful financial resource to get loans or help with utilities and renting properties. The person isn’t bad or good, the credit is, and it’s one signal of many for financial health and wellness. 

Feeling financially well provides a sense of safety and security. Employers can offer employees financial perks and benefits to help them in a crisis, manage their current financial picture, or plan for the future—or help break the debt cycle.