Creating a Credit Score Without the Credit Card

Austin, Texas //

In an effort to help consumers build credit and savings simultaneously, Austin Capital Bank has launched Credit Strong, a nationwide credit-building account that combines both an installment loan and an FDIC-insured savings account.

“Consumers usually build credit by opening up a credit card and then spending on purchases,” said Erik Beguin, CEO and president of Austin Capital. “By opening a Credit Strong account with us, consumers can instead establish or build their credit by setting aside savings.”

Traditional forms of establishing and building credit, such as secured credit cards and credit builder loans, require a large upfront cash deposit, but more than 40 percent of Americans don’t have enough cash in savings to cover a $400 emergency, according to a recent study by the Federal Reserve. This lack of savings can make building positive credit a challenge for consumers, potentially trapping them in a cycle of high-cost credit.

With a Credit Strong account, consumers make a commitment to set aside savings each month and demonstrate a responsible pattern of on-time repayment that lenders look for when extending credit on favorable terms. At account maturity, accountholders will have up to 24 months of installment payment history reported to the three major credit bureaus and have set aside up to $2,000 in their savings account. Customers may close their accounts at any time with no prepayment or early withdrawal penalty.

With no upfront security deposit, no hard credit inquiry or credit score required, and low monthly payments, a Credit Strong account makes building credit easier and more affordable. Consumers can apply online and be approved within minutes, and they also receive a free monthly FICO Score to track progress.

“Credit Strong makes the ability to build good credit accessible to almost anyone, ranging from working class individuals with an imperfect credit profile and recent graduates who want to start establishing a credit history, to sophisticated users of credit looking to round out their profile with an affordable installment tradeline,” said Beguin. “With the creation of this product we have eliminated the barrier of an upfront security deposit and have also removed the temptation and risk of over-spending that’s often associated with credit cards.”

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