Issued by Celtic Bank, the Perpay Credit Card is geared toward cardholders who want to build their credit but don’t like the idea of paying the security deposit that comes with secured credit cards.
Here’s everything you need to know about the Perpay Credit Card.
What Is the Perpay Credit Card?
The Perpay Credit Card comes from the buy now, pay later company Perpay. Through the company’s online marketplace, you can purchase a number of products from brands like Apple, Nintendo and KitchenAid.
The card itself is an unsecured credit card designed for building credit. Consumers with low credit scores or limited history have a higher chance of being approved for the card versus other unsecured credit cards.
This is ideal for consumers who don’t want to provide a security deposit for a secured credit card or rely on the deposit to be their credit line. But there are a few caveats to consider.
For instance, to keep your card active, you must set up a minimum direct deposit from each paycheck. The deposit is aligned to your pay cycle so you won’t be charged outside of that. However, you will be charged every month even if you don’t have a balance on your card.
When you have no balance, Perpay says your funds will be available for you to do the following:
— Withdraw the funds to a verified bank account
— Use the funds to shop at the Perpay Marketplace
— Use the funds in the future to pay down a balance
And while there’s technically no annual fee, the card does come with other fees (and limitations) to be aware of.
[Read: Credit Cards for Building Credit]
Pros and Cons of the Perpay Credit Card
Pros
— Earn rewards. The Perpay Credit Card offers 2% back on all payments — not purchases. Rewards are then applied within 10 days from the statement closing date.
— Build credit. The Perpay Credit Card acts like a credit-building product, allowing consumers with low credit scores a higher chance of approval.
— Apply with no impact to your score. Perpay pulls your data from Clarity Services, not FICO or VantageScore. Clarity is a part of Experian and specializes in alternative data the big three credit bureaus don’t normally consider. However, once you have the card, Perpay will report your payment activity to all three bureaus.
Cons
— Limited redemption options. You may earn 2% back, but you earn those rewards in the form of Perpay online marketplace credits. So, dissimilar to cash back that you can spend anywhere, Perpay rewards must be spent at the Perpay Marketplace.
— Extra fees. While the Perpay Credit Card doesn’t technically have an annual fee, you do have to pay a monthly account service fee of $9. There’s also an account opening fee of $9, which means you’ll pay $117 in the first year alone.
— Payments pulled from paychecks. As mentioned above, the Perpay Credit Card pulls its payments directly from your paycheck. Depending on how you feel about this, though, this could be a pro or a con.
[Read: Secured Credit Cards]
Perpay Credit Card Alternatives
There are plenty of secured and unsecured credit cards that don’t come with monthly service fees and offer better rewards redemptions.
For example, the Capital One Platinum Secured Credit Card has a $0 annual fee. And while it may require a security deposit, you can put down a deposit as low as $49 to get an initial credit line of $200.
As someone who actually had this card when starting my credit-builder journey, I found it extremely helpful. You’ll also be considered for a credit line increase in as little as six months. And when you’ve outgrown the card, you can request an upgrade from Capital One, just like I did.
If you’re interested in rewards, the Capital One Quicksilver Secured Cash Rewards Credit Card offers 1.5% Cash Back on every purchase, every day, and the Discover it® Secured Credit Card offers earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, automatically. You’ll still earn unlimited 1% cash back on all other purchases.
At the end of the day, the Perpay Credit Card has stiff competition, and you’d be better off not having to jump through hoops to earn rewards or keep your unused cash.
More from U.S. News
Services That Allow You to Buy Now, Pay Later
Your Guide to the Big 3 Credit Bureaus
How to Upgrade and Downgrade Your Capital One Credit Card
What Is the Perpay Credit Card, and Is It Worth It? originally appeared on usnews.com
Update 04/13/26: This story was published at an earlier date and has been updated with new information.