Get Bits is a digital credit card designed for those of you who want to improve their credit score without getting into debt. This Get Bits review is diving deep into what it is, how it works, and more importantly, if you should consider it.
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Credit scores play such an important role in our financial system and the best way to build your credit score is to borrow money and pay it back.
But what if you have a bad score or you’ve made some financial mistakes in the past with your debts? Generally speaking, no bank will be willing to lend to you.
You may be thinking your credit card application might get declined and get put off applying.
And therein lies the gap for you if your history is bad and no one wants to lend to you to build your credit score.
This gap is where Get Bits fit in. In this Get Bits review we will look at what Get Bits is, how they fill in that gap, and whether it’s for you.
Get Bits Review
What is Get Bits?
Get Bits is a digital credit-builder credit card which allows you to build your credit in a different way.
The Bis credit card is a virtual card therefore you can’t use it for any purchases therefore you don’t get a physical card sent to you.
How does Get Bits work?
You apply for the Bits credit card on your mobile phone by downloading the app.
You apply for the card with a fixed balance that you pay back on a monthly basis.
Your monthly payments are fixed according to your chosen schedule and must be paid back every month.
This application runs a soft check on your credit file and Bits recommends you shouldn’t apply if you’ve had a CCJ, IVA or Bankruptcy in the last 6 months.
How much will I be paying?
At the time of this writing (June 2020), there are 5 options to choose from.
All the plans are treated as a monthly subscription according to your chosen amount. The money is deducted from your debit card just like a subscription service.
The amount you’ll be paying is more than what the minimum payment would be on a traditional credit card owing the same amount of money. This is good in the eyes of building your credit score.
Due to this setup, you don’t get your money back.
How does this build my credit score?
Bits appears on your credit file as “Bits Credit Card (Fea Card Limited)”. They report your credit card repayments to Experian as a credit card that is used and always paid on time every month.
As long as you keep up your payments this guarantees that you will have a perfect payment history on your credit file, which leads to an increase on your credit score.
It’s worth noting that the impact on your score increase depends on the plan you choose. The higher amount plans will improve your score better than the lower amount plans.
Credit Utilisation
This is a technical term in the credit scoring dictionary. It’s also known as debt utilisation.
It effectively measures the amount of debt you use compared to the amount of debt you have available on credit cards.
The less debt you use compared to the amount of credit you have the better. It is often suggested to try and keep your credit utilisation under 30%.
For example in the case of the Bits credit card, if you choose the £12 a month plan, your credit limit shows as £432. This means your credit file will show that you spend £12 when you have £432 available.
Making your credit utilisation 12 / 432 = 2.8%.
This also goes in your favour when building your credit score as it shows that you don’t use all your available amount owed.
Even if you wanted to you couldn’t because Bits has no card for you to use. It’s all automatically set.
What if I want to skip a payment?
This is not advised!
If you don’t pay the due amount in a month it will be recorded on your credit file as a missed payment.
Missed payments are not what you want if you’re trying to build your credit score. Actually, you don’t ever want missed payments.
We encourage you to take the simple action of performing a Financial Health Check using our FREE guide below. There are 4 financial numbers you should know about your finances and a couple of these numbers will influence your financial strategy. Your credit score is one of them.
Alright, back to the review
Leaving Bits
In theory you can cancel your Bits credit card anytime however it’s generally advised to not open or close accounts within 12 months.
Opening and closing credit accounts quickly is actually a negative as far as credit scores are concerned.
So I’d join Bits with the intention of riding it out in a longer term. This is not a get-high-credit-score-quick plan.
Is Get Bits Worth it?
I’ll be honest, I like this!
What I like about Bits
- Where else could you build your credit score with as little as £2 per month?
- Build your credit score with no interest-bearing debt
- You don’t get a physical credit card that you spend on, which means you don’t get into more debt
- Quick email responses from customer support (they replied to my query within a couple of hours)
What I don’t like about Bits
- You don’t get your money back (money goes towards their costs)
- Can’t apply if you have CCJ, IVA, or bankruptcy in the last 6 months (however 6 months is better than 6 years)
- If you’re choosing the £20 per month option then I’d compare this with Loqbox (see below)
Worst-case scenario
You sign up to Bits and your score doesn’t improve much.
The chances of this happening are slim given that you don’t do anything else to impede your credit score.
Apart from that, there is no real risk in your signing up to Bits from my opinion.
Points to Remember
- Sign up what you can comfortably afford between £2 and £40 per month over 3 years
- Your monthly payments are subscription for the service of Bits so you don’t get it back
- As long as you don’t miss payments you’ll be fine
- You’re building your credit score with no debt
- You can set it, forget it, and let it work its magic
Get Bits alternatives
If you’re reading this Get Bits review and thinking it’s not quite for you, there are alternatives.
Loqbox solves this similar problem of building credit score without a traditional credit card in a similar fashion as Bits. The biggest difference is in the way they work.
Read our Loqbox review to see how it works compared to Bits.
On the other hand, getting a traditional credit-builder credit card is still a great option, given that you use the credit card in the right way.
Take Action
What are your thoughts based on this Get Bits review?
If you’re looking to improve your credit score, at least check out the Bits digital credit card.
Whatever you’re thinking of doing to build your credit score, do it now! Don’t delay.
Share this with your friend, family, or partner and start helping each other to build your credit score.
Download our Free Financial Health Check to give you a good overview of your financial health.
Let us know how you’re getting along by getting in touch with us, we’d love to hear from you
Knowledge is powerless without action
So take action, and take care
Thando