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Credit Cards for Students with No Credit History

10 min read
Last Updated: July 17, 2024
Getting a credit card

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Key Takeaways

  1. A student credit card may be one of the best types of credit cards for students with no credit history.

  2. Student cards have both drawbacks and benefits, like having lower credit limits but also offering perks and rewards.

  3. Alternatives to a student card include getting a secured credit card or becoming an authorized user on someone else's card.

As a student, managing your money can be challenging, especially if you're working part-time around a hectic class schedule or relying on student loans for your living costs. This can lead to an inconsistent flow of cash. A credit card can help you cover everyday costs while managing your budget. Getting approved for a regular credit card can be tough for a college student. This difficulty arises because most credit cards need applicants to already have a credit history—a track record of borrowing money and paying it back—which many college students don't have yet.

Fortunately, lenders understand that students may have a hard time getting credit and provide options to assist them. For instance, there are student credit cards designed specifically for students who don't have a credit history. Additionally, secured credit cards are another great option for students, offering an accessible way to start building credit. As long as the issuer reports your account activity to a credit bureau, both student and secured cards, like the Discover it® Student and Discover it® Secured Credit Cards, let you build your credit with responsible use. 1

Why should you use a student or secured card to help build your credit history?

Credit card companies need a way to verify that you’re a trustworthy borrower. For many cards, your credit history (provided by a credit bureau to prospective lenders), including your credit score, helps a credit card issuer determine your eligibility for credit when you apply.

Learn More About Student Credit Cards

The better your credit habits, such as consistently paying bills on time, the higher your credit score will likely be. A higher credit score signals to credit card issuers that you're reliable in repaying your debts on time. As a result, a good credit score may lead to benefits like a higher credit limit and lower interest rates on your credit card. If you have a history of not using credit responsibly, leading to a lower credit score, it may indicate to credit card issuers that you might not repay your debts. This could mean you face restrictions like lower credit limits, higher interest rates, or even difficulty obtaining new credit. If you're a college student with limited credit history, building good credit is important to improve your credit card choices. Staying on top of your credit score is a good strategy to see how well you manage your credit.

Did you know?

As a Discover Card member, you can view your recent FICO® Credit Scores for free on mobile and online.3 A good FICO® Score can make all the difference in which credit cards you’ll qualify for down the road.

Best credit cards for students with no credit history

If you're a full-time or part-time student, you can qualify for several types of credit cards, even without any credit history. The top options for students without credit include student credit cards, secured credit cards, and store credit cards. Another possibility is to become an authorized user on someone else's card. By comparing these choices, you can decide which one aligns best with your financial needs.

Student credit cards

Student credit cards are designed specifically for college students and don't usually require a credit score to qualify. For instance, there's no credit score required to apply for Discover Student credit cards.4

Student credit cards are more accessible partly because they often have higher interest rates and lower credit limits compared to standard credit cards. Although it may seem like a disadvantage, a lower credit limit may actually help you control your debt as you're building credit and learning to manage your first credit card. Plus, by making payments on time and paying off your balance each billing cycle, you can avoid paying any interest at all.

As an added bonus, some student credit cards offer perks and rewards like cash back or travel miles. A student cash back rewards credit card may even offer unlimited cash back on all purchases. Essentially, these student cash back cards can give you a portion of your spending back as cash, which can significantly accumulate over time.

For example, with the Discover it® Student Chrome card, you can earn a 2% cashback Bonus® at gas stations and restaurants on up to $1,000 in combined purchases each quarter, automatically. Plus, you'll earn 1% cash back on all other purchases – automatically.5

You may also receive an introductory offer when you sign up for a student credit card, such as a low intro APR, which can help you avoid interest on balances you carry during the intro period. These offers can help you purchase and pay off larger expenses, like textbooks or dorm furniture, over time without interest—as long as you pay off your balance in full before the introductory period ends.

Getting Secured credit cards with no credit history

If you're looking for an alternative to a student credit card, consider applying for a secured credit card instead. Secured cards share many benefits with student cards, such as the chance to earn rewards and the availability of low introductory APR rates. They also provide an opportunity to build credit through responsible usage. Importantly, secured cards often don't require a credit history for application, making them accessible to students without credit history or individuals with lower credit.

Secured cards, like student credit cards, often come with higher interest rates and lower credit limits compared to standard credit cards. However, the way credit limits are determined on secured cards is different compared to student cards.

 

The main difference is that secured card applicants need to make a refundable security deposit to secure their line of credit, which is not a requirement for student (unsecured) cards. For example, with the Discover It® Secured Credit Card, your credit line will equal your deposit amount, starting at $200.5 If you use the card responsibly, you may be eligible to upgrade to an unsecured credit card—usually with the same features and terms—and reclaim your original deposit.

Did you know?

With the Discover it® Secured credit card, you can get your deposit back when you upgrade to an unsecured card after six consecutive on-time payments and six months of good status on all your credit accounts.6

While a secured card may seem like a debit card in that it involves your own money, it works quite differently. With a secured card, the money you spend is actually borrowed against your credit limit, not deducted directly from your deposit. Your refundable deposit simply "secures" the card as collateral. By using a secured credit card responsibly, you can improve your credit over time, potentially leading to access to credit cards with more favorable terms and lower interest rates in the future.

Store credit cards

Store credit cards can be a good choice for students aiming to establish credit. They fall into two categories: co-branded cards and closed-loop cards, each with its own advantages and disadvantages.

 

Closed-loop cards typically do not require an existing credit history, making them easier to obtain. However, their use is restricted to the specific store or chain of stores that issued the card, limiting where you can shop with them. On the other hand, co-branded cards are created in partnership between retailers and financial institutions. They may have requirements that are more strict compared to closed-loop cards. The advantage of co-branded cards is their flexibility; they can be used for purchases anywhere that accepts them, not just at the issuing store.

One example of a co-branded card is the NHL® Discover it® Credit Card, which lets hockey fans shop and earn cash back anywhere. You can earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, you earn unlimited 1% cash back on all other purchases – automatically. Another common example is gas credit cards, which generally provide rewards at the gas pump and offer deals on select items inside the store. 

Become an authorized user on someone else's credit card

If you can't qualify for a student or secured credit card, consider becoming an authorized user on a partner or family member's credit card. Being an authorized user gives you access to credit as a college student with no credit history—and it can help you build credit at the same time.

 

Here's how it works. First, the primary cardholder adds you to the credit card account and designates you as an authorized user. Next, you get your own physical credit card to make purchases.

In most cases, the primary cardholder's activity gets reported to one of the three major credit bureaus and added to your credit file, possibly helping your credit score. On the other hand, reporting also includes missed or late payments, which could negatively impact your credit score.

 

Legally, the primary cardholder is responsible for the payments—but they may expect you to cover your share of the charges. It's important for the authorized user and the primary cardholder to communicate clearly with each other so that you understand each other's expectations and responsibilities.

Applying for a student credit card with no credit history

You'll need to provide certain personal and financial information on your student credit card application. Compiling this information beforehand can help you complete your application quickly and accurately, but remember that each application may be slightly different. As a college student, here's a checklist of what you'll generally need when applying for credit cards with no credit:

  • Your full legal name
  • Your current address
  • Your current employment status
  • Your Social Security Number (SSN) or, as an alternative, your Individual Taxpayer Identification Number (ITIN) if the issuer accepts ITINs
  • Your approximate housing expenses, such as monthly rent
  • Your approximate yearly income
  • The best phone number for contacting you

Choosing a student credit card with no credit history

When searching for the best credit cards for students with no credit, you should weigh a few key factors carefully. Here are some important criteria to consider when you're comparing student cards, like Student Cash Back vs. Chrome from Discover:

  • Fees — Annual credit card fees can range from $0 to more than $500, so it’s important to read the fine print. There’s no annual fee to use the Discover it® Student Chrome or Cash Back cards.
  • Interest Rates — By comparing interest rates and introductory APR, you can determine how much interest you’ll be charged and find a card that suits your needs.
  • Rewards — Look for a card that offers generous rewards on the types of purchases you plan to make. For example, Discover it® Student Cash Back lets you earn 5% cash back on everyday purchases at grocery stores, restaurants, gas stations, and more when you activate.
  • Sign-Up Bonuses — Many credit cards provide welcome bonuses to new members for signing up. For instance, only Discover gives you an unlimited match of all the cash back you’ve earned at the end of your first year.7

Building your credit history with a student credit card

If you're a student starting with no credit history, it's important to remember that you still have several choices for getting a credit card. You could opt for a student credit card, a secured card, or become an authorized user on someone else's account. By using your card wisely and responsibly, you'll learn valuable credit management skills and begin building a positive credit history. No matter which option you select, you're setting yourself up for a more secure financial future as you move toward graduation.

Important Information >
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See Official Rules for sweepstakes eligibility and entry requirements, entry deadlines and drawing dates, details including odds, list of eligible colleges and universities, prize descriptions and an alternate method of entry.9

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  1. Build credit with responsible use(Student): Discover reports your credit history to the three major credit bureaus so it can help build your credit if used responsibly. Late payments, delinquencies or other derogatory activity with your credit card accounts and loans may adversely impact your ability to build credit.

  2. Build credit with responsible use(Secured): Discover reports your credit history to the three major credit bureaus so it can help build/rebuild your credit if used responsibly. Late payments, delinquencies or other derogatory activity with your credit card accounts and loans may adversely impact your ability to build/rebuild credit.

  3. FICO® Credit Score Terms: Your FICO® Credit Score, key factors and other credit information are based on data from TransUnion® and may be different from other credit scores and other credit information provided by different bureaus. This information is intended for and only provided to Primary account holders who have an available score. See Discover.com/FICO about the availability of your score. Your score, key factors and other credit information are available on Discover.com and cardmembers are also provided a score on statements. Customers will see up to a year of recent scores online. Discover and other lenders may use different inputs, such as FICO® Credit Scores, other credit scores and more information in credit decisions. This benefit may change or end in the future. FICO is a registered trademark of Fair Isaac Corporation in the United States and other countries.

    Discover Financial Services and Fair Isaac are not credit repair organizations as defined under federal law or state law, including the Credit Repair Organizations Act. Discover Financial Services and Fair Isaac do not provide “credit repair” services or assistance regarding “rebuilding” or “improving” your credit record, credit history or credit rating.

  4. No Credit Score Required to Apply (Student): Based on the preceding 12 months of Discover Student credit card application data, applicants without a credit score may qualify. You must meet other applicable underwriting criteria. When we evaluate your creditworthiness, we consider all the information you provide on your application, your credit report, and other information. If you have a credit score, we may use that in our evaluation. Not having a credit record may impact your approval odds.

  5. 2% Cash Back at gas and restaurants: You earn a full 2% Cashback Bonus® on your first $1000 in combined purchases at Gas Stations (stand-alone), and Restaurants each calendar quarter. Calendar quarters begin January 1, April 1, July 1, and October 1. Purchases at Gas Stations and Restaurants over the quarterly cap, and all other purchases, earn 1% cash back. Gas Station purchases include those made at merchants classified as places that sell automotive gasoline that can be bought at the pump or inside the station, and some public electric vehicle charging stations. Gas Stations affiliated with supermarkets, supercenters, and wholesale clubs may not be eligible. Restaurant purchases include those made at merchants classified as full-service restaurants, cafes, cafeterias, fast-food locations, and restaurant delivery services. Purchases must be made with merchants in the U.S. To qualify for 2%, the purchase transaction date must be before or on the last day of the offer or promotion. For online purchases, the transaction date from the merchant may be the date when the item ships. Rewards are added to your account within two billing periods. Even if a purchase appears to fit in a 2% category, the merchant may not have a merchant category code (MCC) in that category. Merchants and payment processors are assigned an MCC based on their typical products and services. Discover Card does not assign MCCs to merchants. Certain third-party payment accounts and digital wallet transactions may not earn 2% if the technology does not provide sufficient transaction details or a qualifying MCC. Learn more at Discover.com/digitalwallets. See Cashback Bonus Program Terms and Conditions for more information.

  6. Secured Card Deposit Range: If approved, you must make a minimum security deposit of $200 (or more, in increments of $100 up to $2,500), which will equal your requested credit limit. Discover will determine your maximum credit limit by your income and ability to pay.

  7. Getting your deposit back: Monthly reviews start your seventh month as a customer. We will refund your security deposit if you have made all payments on time for the last six consecutive billing cycles on all your Discover accounts including any loans, and you've remained in "good status" on all credit accounts you are responsible for whether they are Discover accounts or not. "Good status" means: (1) your credit report shows no delinquencies, charge-offs, repossessions, or bankruptcies for the six months prior to our review; and (2) your Discover secured card is not in a prohibited status at the time of our review, including, but not limited to: closed, revoked, suspended, subject to tax levy, garnishment, deceased, lost/stolen, or fraud. Monthly reviews may be delayed if you change your payment due date. We typically process your refund in 2-3 business days based on your delivery preference. If you close your account and pay in full, we'll return your deposit within two billing cycles plus ten days.

  8. Discover Match®: We’ll match all the Miles you’ve earned on your credit card from the day your new account is approved through your first 12 consecutive billing periods or 365 days, whichever is longer, and add it to your rewards account within two billing periods. You earn Miles only when they’re processed, which may be after the transaction date. We will not match: rewards that are processed after your match period ends; statement credits; rewards transfers from Discover checking or other deposit accounts; or rewards for accounts that are closed. This offer may not be available in the future and is exclusively for new cardmembers. No purchase minimums.

  9. NO PURCHASE OR CREDIT CARD APPLICATION OR ACCOUNT NECESSARY. Sweepstakes open to residents of the 50 United States (DC) and the US Territories 18 years or older. Sweepstakes starts 9/3/2024 and ends 8/31/2025. See Official Rules for eligibility and entry requirements, entry deadlines and drawing dates, details including odds, list of eligible colleges and universities, prize descriptions and an alternate method of entry. Void where prohibited.

    Sponsor: Discover Products Inc. 2500 Lake Cook Road, Riverwoods, IL 60015

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