Which Prepaid Debit Cards Report to the Credit Reporting Agencies?

This almost turned out to be the shortest article ever, one word…”none.”  Prepaid cards are not reported to the three major credit reporting agencies (CRAs) – Equifax, Experian and TransUnion.   I found three prepaid loadable cards that state they report to credit reporting agencies.  The three cards are Prepaid Visa RushCard, READYdebit Visa and AccountNow. They don’t report to the three major companies, but to Payment Reporting Builds Credit (PRBC).  Ever heard of them?  I didn’t think so.

PRBC

PRBC is a consumer credit reporting agency, but major creditors don’t use Payment Reporting Builds Credit to make lending decisions yet.  They capture rent payments, utility bills and other recurring bills not reported to the three major credit reporting agencies.  They help consumers build credit files as they pay bills or verify self-reported payments.

How does this information get reported to them? If you pay your bills through online automatic bill pay with a partner of theirs (such as the three prepaid cards mentioned above), the data gets reported.  If you submit your own data, you need at least six months and up to 36 months of history.  Payment Reporting Builds Credit charges you to verify the information you submit, which is $20 for rental history and $15 to verify other types of accounts such as phone, cable gas and electric.

According to the websites of these prepaid cards, companies that buy the report from Payment Reporting Builds Credit also receive a Bill Payment Score (BPS).  These companies admit that the score is not as important or significant as the FICO score, but helps in showing payment behavior.

Until this report is used by more business to grant you credit, you still need to establish credit at the three major credit reporting agencies. If you have been turned down for an unsecured credit card, the best way to build credit is to apply for a secured card.  A secured card is usually offered at a low credit limit of up to $500 and requires collateral such as a savings account with the same amount in it. There is usually an annual fee for this card. You should only charge a small amount on the card and pay it in full.  Make sure that the card issuer reports to the three credit bureaus, so you can build your credit history  Also verify that they will let you upgrade to an unsecured card after one or two years.

Credit Reporting Expert, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Credit Cards, Credit Report, Credit Score, Getting Credit, Money & Identity

This post was written by John Ulzheimer