The best credit cards for building credit of July 2024

If you want to build or rebuild credit, certain credit cards are available specifically for people with no credit history or poor credit. Opening a credit card could help fill out your credit report and improve your credit score, as long as you practice responsible financial behavior.

Here are CNBC Select's best credit cards for building or rebuilding credit based on security deposit minimums, fees, rewards programs, APR and more. (See our methodology for more information on how we made this list).

Who's this for? If you have average credit and are looking to build up to a good or excellent credit score, it's a good idea to consider a credit card designed for average credit applicants, such as the Capital One Platinum Credit Card.

Standout benefits: This card has travel benefits that can save you money and protect you against unexpected issues. These benefits include no foreign transaction fees, *Emergency Card Services, Mastercard ID Theft Protection™, and Fraud Coverage.

Minimum deposit: N/A

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Who's this for? The Discover it® Student Cash Back is our top pick for students looking to build good credit while attending college. You must be over 18 and a U.S. citizen to apply.

Standout benefits: This card provides a generous cash-back program and welcome bonus. It also has no foreign transaction fees, so you can study abroad or vacation outside the U.S. without worrying about paying the typical 3% fee other cards charge. In addition, there's a helpful 0% intro APR for the first six months on new purchases (after, 18.24% to 27.24% variable).

Minimum deposit: N/A

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Who's this for? The Discover it® Secured Credit Card is ideal for those looking for a secured card with many of the same perks as a standard card, such as a robust cash-back program, no annual fee and no foreign transaction fees.

Standout benefits: You'll earn cash back on all everyday spending, including elevated returns for gas station and restaurant spending. Plus, starting seven months from account opening, Discover will automatically review your credit card account to see if you can transition to an unsecured line of credit and return your deposit.

Minimum deposit: You must put down a minimum deposit of $200 to open a Discover it® Secured Credit Card, or as much as $2,500. Your credit limit is equal to your deposit.

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Who's this for? If you're looking for a secured card, but can't afford the typical $200 deposit, look at the Capital One Platinum Secured Credit Card.

Standout benefits: In addition to lower security deposits, Capital One will automatically consider you for a higher credit line in as little as six months with no additional deposit needed.

Minimum deposit: This card has varying minimum security deposits starting as low as $49, $99 or $200 — based on your creditworthiness. If you qualify, you can access a $200 credit limit while only depositing $49 or $99.

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Who's this for? If you want to build credit while earning cash back, consider the U.S. Bank Cash+® Visa® Secured Card.

Standout benefits: The U.S. Bank Cash+ card offers up to 5% cash back on certain purchases. If you spend within your credit limit and pay your bill when it's due, over time, U.S. Bank could upgrade you to the U.S. Bank Cash+® Visa Signature® Card. Once you're upgraded, your security deposit will be returned.

Minimum deposit: You must put down a deposit of between $300 and $5,000 which acts as your credit line.

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Who's this for? The Petal 2 "Cash Back, No Fees" Visa Credit Card is ideal if you're an applicant without credit history because it considers a range of other factors such as bank statements and earnings to determine eligibility. However, if you do have a credit history, that does factor into the credit decision.

Standout benefits: The Petal 2 card charges zero fees*: no annual fee, no late payment fee and no foreign transaction fees. It also offers a rewards program with higher returns for those who pay their bills on time.

Minimum deposit: N/A

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Who's this for? The U.S. Bank Altitude® Go Visa® Secured Card is one of the few travel-focused secured credit cards on the market. So if you want to earn travel rewards on your purchases while building your credit, this card may be a great fit for you.

Standout benefits: This card offers generous bonus spending categories that even compete with some non-secured credit cards. You're also eligible for a $15 credit for annual streaming service purchases. In addition, it doesn't have foreign transaction fees, and you can choose the due date for your bill.

Minimum deposit: You must put down a deposit of between $300 and $5,000 which acts as your credit line. If you spend within your credit limit and pay your bill when it's due, over time, U.S. Bank could upgrade you to the U.S. Bank Altitude® Go Visa Signature® Card. Once you're upgraded, your security deposit will be returned.

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Who's this for? The Bank of America Business Advantage Unlimited Cash Rewards Secured credit card caters to small business owners who need to strengthen their credit profile.

Standout benefits: This card keeps it simple with 1.5% cash back on every purchase. You don't have to navigate spending categories or worry about capped cash back.

Minimum deposit: To open an account, you need a minimum security deposit of $1,000, and your credit limit is equal to your security deposit.

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Who's this for? The Chase Freedom Rise℠ is geared toward Chase banking customers starting to establish a credit history.

Standout benefits: The Freedom Rise earns 1.5% cash back on every purchase, which is a flat cash-back rate on par with many of the top cash-back cards that require good to excellent credit.

Minimum deposit: N/A

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The Capital One Platinum Credit Card doesn't offer a rewards program, so you don't have the opportunity to earn cash back, points or miles from your everyday spending. But with no annual fee, it can be a good starter card if you want to eventually upgrade to another card in the Capital One family.

Rewards

None

Welcome bonus

None

Annual fee

$0

Notable perks

The Capital One Platinum Credit Card charges no foreign transaction fees. This perk will save you the typical 3% fee many other cards charge on each purchase made outside the U.S. For example, the average American spends $2,154 a year on travel, and depending on how much of that is done abroad, you could potentially save up to $65 with the Platinum Credit Card from Capital One (and even more depending on your travel spending habits).

This card also offers fraud coverage that provides $0 Fraud Liability for unauthorized charges, if your credit card is lost or stolen, you can get an emergency card replacement and a cash advance, subject to available credit and Mastercard ID Theft Protection™ that is available to help should you become the victim of Identity theft- all at no extra cost.

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Financial experts often stress the importance of building credit at a young age, and opening a credit card while you're a student is one of the easiest ways to establish credit. The Discover it® Student Cash Back stands out for being one of the more rewarding student credit cards on the market.

Rewards

• 5% back for up to $1,500 in purchases in rotating quarterly bonus categories you activate (then 1%)
• 1% back on all other purchases

Welcome bonus

Discover will match the cash back you earn during the first year with no minimum spending requirement or cap on the match.

Annual fee

$0

Notable perks

Outside of its cash-back earnings, the Discover it® Student Cash Back offers no annual fee and no foreign transaction fees, so you can study abroad or vacation outside the U.S. without worrying about paying the typical 3% fee other cards charge. There's also a 0% introductory APR for the first six months on new purchases, which is perfect for financing textbooks or dorm room essentials. After the intro period, there's a 18.24% to 27.24% variable APR.

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The Discover it® Secured Credit Card gives you access to many of the perks and benefits available to people with higher credit scores. You must put down a minimum deposit of $200 to open a Discover it® Secured Credit Card, or as much as $2,500. Your credit limit is equal to your deposit.

Rewards

• 2% back at gas stations and restaurants on up to $1,000 in combined purchases each quarter
• 1% back on all other purchases

Welcome bonus

Discover will match any cash back you earn during the first 12 billing cycles. So, if you have $100 cash back at the end of the first year, Discover will give you an additional $100.

Annual fee

$0

Notable perks

You will enjoy a robust cash-back program, no annual fee and no foreign transaction fees. What makes this card stand out is the ease with which you can transition to an unsecured card. Starting seven months from account opening, Discover will automatically review your credit card account to see if you can transition to an unsecured line of credit and return your deposit. This takes the guesswork out of wondering when you can transition to an unsecured card.

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The Capital One Platinum Secured Credit Card stands out from other secured cards for offering lower minimum security deposits — either starting as low as $49, $99 or $200, depending on your creditworthiness. If you qualify, you can still access a $200 credit limit while only depositing $49 or $99.

Rewards

None

Welcome bonus

None

Annual fee

$0

Notable perks

Capital One automatically considers you for a higher credit line in as little as six months with no additional deposit needed. This is a great incentive to practice responsible card management. Unfortunately, there is no rewards program or welcome bonus.

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The U.S. Bank Cash+® Visa® Secured Card allows you to build credit while earning cash back. You must put down a deposit of between $300 and $5,000 which acts as your credit line.

Rewards

• 5% back on your first $2,000 in combined eligible purchases each quarter in two categories you choose. Some categories include: TV, internet and streaming, home utilities, cell phone providers, fast food restaurants and movie theatres.
• 2% back on eligible purchases in your choice of one everyday category (like gas stations, grocery stores and restaurants)
• 1% back on all other eligible purchases

Welcome bonus

None

Annual fee

$0

Notable perks

The cashback you earn can be redeemed in one of three ways: a statement credit to your account, direct deposit to your U.S. Bank checking, savings or money market account, or a U.S. Bank rewards card (similar to a Visa gift card). If you spend within your credit limit and pay your bill when it's due, over time, U.S. Bank could upgrade you to the U.S. Bank Cash+® Visa Signature® Card, but unlike some other cards on this list, there's no clear timeline. Once you're upgraded, your security deposit will be returned.

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The Petal 2 "Cash Back, No Fees" Visa Credit Card, issued by WebBank, is a unique card that takes a different approach to the credit card application process. Instead of judging your creditworthiness solely based on credit history, Petal may ask you to link bank accounts during the application process. Then, WebBank, analyzes your bank statements and other data, such as bill payments and earnings, to determine your eligibility.

Rewards

• 1% cash back on eligible purchases right away, which can increase up to 1.5% cash back after you make 12 on-time monthly payments
• 2% to 10% cash back at select merchants

Welcome bonus

None

Annual fee

$0

Notable perks

The Petal 2 Card charges no annual fee, no late payment fee and no foreign transaction fees. The ability to earn up to 1.5% cash back after making 12 on-time monthly payments is not only a nice perk but a great way to encourage responsible behavior. The card also stands out for consumers trying to build credit because there's no security deposit required.

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The U.S. Bank Altitude® Go Visa® Secured Card stands out for being one of the most rewarding secured credit cards on the market. When redeemed, points are valued at 1 cent each, providing you with virtually 1% to 4% back on your purchases. You must put down a deposit of between $300 and $5,000 which acts as your credit line.

Rewards

• 4X points per dollar spent on dining
• 2X points per dollar spent at grocery stores, gas stations and streaming services
• 1X points per dollar spent on all other eligible purchases

Welcome bonus

None

Annual fee

$0

Notable perks

The U.S. Bank Altitude Go Visa Secured Card doesn't have an annual fee or foreign transaction fees, and you can choose the due date for your bill. You're also eligible for a $15 credit for annual streaming service purchases. As your credit improves, you may be given the option to upgrade to the U.S. Bank Altitude Go Visa Signature Card and claim your security deposit.

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The Bank of America Business Advantage Unlimited Cash Rewards Secured credit card provides small businesses a path to building credit while earning rewards.

Rewards

• 1.5% cash back on eligible purchases

Welcome bonus

None

Annual fee

$0

Notable perks

This card requires a $1,000 minimum upfront deposit, but Bank of America will occasionally review the account and if your credit has improved you may be able to switch to an unsecured card. Perks include travel accident insurance, rental car insurance, lost luggage assistance and emergency ticket replacement. You can also monitor the progress you're making with your credit through the Bank of America Business Advantage 360 platform, which allows you to view your Dun & Bradstreet business credit score for free.

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With the Chase Freedom Rise℠, you can build credit and have a path to upgrading to more rewarding Chase credit cards in the future.

Rewards

• 5% cash back on Lyft rides through March 31, 2025
• 1.5% cash back on eligible purchases

Welcome bonus

Earn a $25 statement credit after enrolling in automatic payments within the first three months of opening the account.

Annual fee

$0

Notable perks

This card is a good credit-building option for Chase customers because it's easier to qualify for when you have at least $250 deposited into an existing Chase checking account or savings account.

It has a solid list of insurance protections for a no-annual-fee credit-building card, including purchase protection, extended warranty protection and trip cancellation/interruption protection. It offers several straightforward redemption options for your rewards, such as travel, statement credits and gift cards.

There's also a limited-time partner offer to enroll and receive three months of free DoorDash DashPass when activated by Dec. 31, 2024. Once the free months end, you'll automatically be enrolled in DashPass at 50% off for the following nine months.

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Deciding which credit-building card is best for you depends heavily on your situation and how you plan to use the card.

Know what cards you're eligible for

Your credit score goes a long way in determining what cards you can qualify for. If you're looking to boost your credit score from average to excellent to increase your approval odds for a home loan, an unsecured credit card could work for you. Credit cards for average credit may also have rewards and other benefits for you to take advantage of. If you're new to credit or recovering from bankruptcy, you may need to start with a secured credit card.

Some credit cards offer pre-approval or pre-qualification, which doesn't guarantee you'll be approved for a card, but it can save you from applying for a card you're likely to be rejected for. In some situations, it may make sense to apply for a card issued by the bank where you have checking or savings accounts because that could boost your approval odds.

Understand what matters when building credit

By making on-time payments, credit cards allow you to slowly rebuild your credit score or fill out your personal credit report. When you keep your credit card balance low, or ideally, pay it off fully each month, this also helps boost your credit score. So building good financial habits is more important than finding the most rewarding credit card.

When you want to use a credit card to establish your credit history, think of rewards as icing on the cake. Don't look for lucrative welcome bonuses or overspending to earn rewards on unlock benefits.

There are different types of credit scoring models, such as FICO Score and VantageScore, but the most popular scores use the information found on your credit report. They typically use the information available from the three major credit reporting bureaus: Experian, TransUnion and Equifax.

By opening a credit card, you're adding to your credit profile. However, how you use the credit card is what matters the most.

Pay your monthly bill on time

Your payment history is a huge part of your credit score. So it's important to pay your credit card bill on time and consistently. As these payments are documented in your credit report, your credit score is more likely to improve over time.

Keep your balance low

Your total debt also factors heavily into how your credit score is calculated. Having less debt and using a smaller percentage of your available credit (keeping a low credit utilization ratio) will have a positive impact on your credit score.

This makes having a budget in place an important part of building credit. It can be easy to overspend with a credit card and if you find yourself in this situation, it could hurt your credit instead of help it.

Rewards and travel benefits shouldn't be the priority when building credit. Rather, you should use a credit-building card to establish responsible credit habits. Once you're in a situation where you can consistently pay off your credit cards in full and on time, then you're ready to consider credit cards with larger welcome bonuses and useful benefits.

Secured credit cards

Secured credit cards require an upfront deposit and your credit limit is based on that deposit. Secured credit cards like the Discover it® Secured Credit Card are less risky for card issuers and are typically easier to get. You can often qualify for secured cards with no credit history or if you have a weak credit score.

Unsecured credit cards do not require a security deposit and have a credit limit based on your income, credit history and other factors. There are unsecured credit cards available to those with average or fair credit, but in general, if you have no credit or bad credit, an unsecured credit card will be your best option for moving your credit score forward.

Student credit cards

If you're interested in opening your first credit card, are over 18 years old and are enrolled in an eligible college, consider a student credit card like the Discover it® Student Cash Back. These cards are designed with students in mind and are often available even if you don't have a credit history. Many of these cards also don't require a security deposit and some even offer rewards.

Your credit score is based on the information in your credit report. To build your credit you need activity, like credit card and loan payments, to be reported to credit bureaus. Your credit score is generally based on factors such as payment history, the age of your accounts and total debt. When you open a credit card and pay the balance on time consistently, this improves your credit score and is a signal to creditors that you're a reliable borrower.

However, having a credit card can work both ways. If you miss payments or are late paying, that harms your credit score. Also, if you pay on time, but accumulate debt that can hurt your credit score. Overall, the best way to build credit is to have a long history of positive activity (i.e. paying on time) with creditors such as banks and credit unions.

There's no set formula for building credit. Instead, your habits, over time, will move your credit score in one direction or another. However, there are a few tips that can help you get things headed in the right direction.

Understand how credit scores work

Knowing what goes into your credit score is key to building a healthy credit profile. While there are multiple types of credit scores, the most popular credit scoring models are largely based on factors such as:

• Payment history
• Debt
• Types of credit
• Age of accounts

Each of these factors are weighted differently, and your payment history and debt typically are more important. It's important to develop the habit of paying bills on time and creating a plan to stay out of debt or pay down your existing debt if you want to improve your credit score.

Get added as an authorized user

If your lack of credit history is preventing you from getting approved for a credit card or a car loan, it might make sense to get added as an authorized user on someone else's account.

When you're added as an authorized user, the credit history of that account could be added to your credit report. This can be a double-edged sword, so it only makes sense to go this route with someone with a history of paying their credit cards on time and in full.

Monitor your credit

A credit monitoring service can help you maintain an error-free credit report by alerting you when anything changes on your credit report. There are free credit monitoring services that are useful, but if you want to cover all the credit bureaus you may want to opt for a more robust paid service.

PrivacyGuard, named one of CNBC Select's best credit monitoring services, provides the ability to monitor all three major credit bureaus and offers identity protection.

Use credit-building tools

Some services can help your credit score by allowing you to include additional information on your credit report. Tools like *Experian Boost™ and eCredable Lift® allow you to add payment history for accounts such as utilities, phone, internet and TV services. Experian Boost works with your Experian credit report and eCredable Lift works with TransUnion.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best credit cards for building credit.

To determine which cards offer the best value for rebuilding credit CNBC Select analyzed over 250 major credit cards issued through FDIC-insured banks and NCUA-insured credit unions that are widely available in the U.S.  

We compared each card on a range of features, including rewards (e.g., cash back, points and miles), annual fees, welcome bonuses, introductory and standard APR and balance transfer fees and foreign transaction fees. We also considered additional perks (e.g., ongoing travel or merchant statement credits), cardholder protections (e.g., purchase protection, $0 liability protection and travel insurance), the application process when available (e.g., is there a credit pull or required credit score) and how easy it is to redeem points (e.g., are rewards are tied to a specific brand; if transferable, to how many/which partners, can you redeem for straight cash back). 
 
We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.  

For the cards that offered a rewards program, we considered consumer spending data forecasts from location intelligence firm Esri to determine where U.S. consumers are spending the most money, like on dining and travel. We used this to help determine what bonus categories are most useful for consumers. Since the value of a point or mile varies based on what they can be redeemed for, we also considered things like transferability and the ability to redeem for cash-back. 

When choosing the best credit cards for rebuilding credit, we focused on cards that are available to consumers with lower credit scores or those with no credit history. While rewards and other benefits were also factored into our decisions, these were secondary considerations.

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Petal 2 Visa Credit Card issued by WebBank.

For rates and fees of the Discover it® Student Cash Back, click here.

For rates and fees of the Discover it® Secured Credit Card, click here.

*For Capital One products listed on this page, some of the above benefits are provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply.

Information about the U.S. Bank Altitude® Go Visa Signature® Card has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.

*Results may vary. Some may not see improved scores or approval odds. Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost.