NerdWallet Launches Secured Credit Card and Credit-Building Features

Financial guidance platform NerdWallet has launched its first credit card.

The new NerdUp is a secured credit card that is designed to help consumers build and improve their credit responsibly, NerdWallet said in a Thursday (Oct. 26) press release emailed to PYMNTS.

“NerdWallet identified a major gap in the market that needed to be addressed — too many Americans are denied access to build and improve their credit, often because of current secured card terms, such as annual fees, high minimum deposits and hard credit checks,” the company said in the release.

NerdUp, which is offered in partnership with Bond, provides several features that aim to remove barriers for consumers who want to build credit, according to the press release.

The secured credit card is free, requires no hard credit check, has no annual or monthly fees, and has a minimum deposit that is lower than the industry standard — $100 compared to the standard of $200 to $300 — the release said.

NerdUp also offers a 0% interest rate as users pay off their balance each month, per the release.

In addition, users of the card earn 1% cash back on purchases, which is automatically added to their deposit account, and have access to a free credit score, tips and insights, the release said.

“We don’t strive to offer our own financial products, but in this case we saw an opportunity to address a gap in the market,” NerdWallet CEO and Co-Founder Tim Chen said in the release. “With NerdUp, we believe we can create a win-win-win for consumers, traditional card issuers and NerdWallet.”

The company can leverage its existing distribution channels to reduce costs, Chen said. As users of NerdUp improve their credit and qualify for more products and services, NerdWallet can connect them with offerings from its partners.

PYMNTS Intelligence has found that high credit scores are pivotal to accessing credit and maintaining purchasing power. Consumers’ efforts to learn more about credit and money management practices are the fastest way to increase their credit scores, according to “The Credit Accessibility Series: Declining Purchasing Power Pushes Consumers to Improve Credit Scores,” a PYMNTS and Sezzle collaboration.

The new offering from NerdWallet comes about three months after the company teamed up with embedded finance platform upSWOT to offer small businesses comprehensive financial solutions. Together, the companies will offer tools and resources to help fuel the growth and success of small business owners.