Chime Card Review: Access to Credit, With Guardrails and Rewards

No credit check

Most credit cards — even secured ones — will conduct a hard inquiry on your credit report when you apply, which helps the card's issuer evaluate your creditworthiness. Even if you're then approved for the card, these hard pulls can temporarily ding your credit scores by a few points, which isn't ideal if you're new to credit. But the Secured Chime Visa® Credit Card doesn't require a credit check, meaning it's a good fit for those with poor credit or no credit.

» MORE: NerdWallet's best credit cards with no credit check

Adjustable credit limit

The money in your Chime Checking Account is the amount you can spend on your card, meaning you can change your credit limit. Other secured credit cards have set credit limits, and you may have to use the card for several months before becoming eligible for a credit limit increase. You can use the Secured Chime Visa® Credit Card to make purchases wherever Visa is accepted.

No interest charges

The Secured Chime Visa® Credit Card charges no interest because it doesn’t let you spend more than what you have available in your account. In some ways, it’s a credit card that bears similarities to a reloadable debit card. This is helpful because you don't have the same risk of getting into high-interest credit card debt that you do with most credit cards.

Maxing out the card won’t affect your credit scores

With the Secured Chime Visa® Credit Card, your credit utilization isn’t reported to credit bureaus, so you don’t have to be mindful of the percentage of your total available money you can spend. But unlike with a prepaid debit card, your payment history and other factors will be reported, so making on-time payments is important. If you miss a payment, your card will be disabled until you pay the balance. And if your payment is more than 30 days late, this will be reported to credit bureaus and can affect your credit scores.

» MORE: What's the difference between prepaid debit cards and secured credit cards?

Autopay feature makes on-time payments effortless

The Safer Credit Building feature — which is a variation on the autopay option available on more traditional credit cards — can prevent an accidental missed payment.

Whenever you use the card to buy something, the total purchase amount is put on hold in your Chime account. Once your bill is due, the on-hold money is automatically used to pay it. This keeps you from paying late and not having the money available to pay your bill in full. (This feature is optional and you do need to opt in.)

» MORE: 3 credit card alerts worth setting up

It can earn rewards

The Secured Chime Visa® Credit Card boasts potentially high rewards rates for a credit builder card, although as noted above, those rates are capped and depend on how much you direct-deposit into your Chime Checking Account.

In the Chime app, you choose your 2% or 5% spending category from the following list:

• Grocery stores.

• Gas.

• Restaurants.

• Taxi and ridesharing.

• Travel, including flights, hotels, car rentals, booking platforms and more.

• Monthly bills, including cell phone service, internet, cable and household utilities, among others. (Medical bills and insurance bills don't qualify.)

A Chime Checking Account is required

The link between the Chime Checking Account and the Secured Chime Visa® Credit Card facilitates the card’s unique user experience, but opening an account is still an extra step.

The opensky® Secured Visa® Credit Card is an option for anyone without a bank account. You can fund the security deposit with a debit card, check, money order or transfer from Western Union.

» LEARN: Opensky — is it legit?

Rewards are limited and conditional

The Secured Chime Visa® Credit Card can offer solid rewards rates, but only if you set up direct deposit into your Chime Checking Account, and only if you deposit enough there.

On top of that, only certain spending qualifies for rewards: Earned cash back is limited to one category, and there's a rewards cap of $30 per month for Chime Plus members, and $75 per month for Chime Prime members.

Put another way, once you've spent $1,500 in your eligible rewards category, you're done earning rewards until the following month. And if you don't select a category at all? You won't earn any rewards at all.

Of course, when you're working to strengthen your credit, rewards aren't the main priority. But they're nice to have, and they're findable among other cards in this class without any deposit conditions. For instance, the $0-annual-fee Discover it® Secured Credit Card earns 2% cash back at gas stations and restaurants on up to $1,000 in purchases each quarter (then 1% back), plus 1% cash back on all other purchases.

And unlike with the Secured Chime Visa® Credit Card, new cardholders are eligible for a bonus offer, which Discover phrases this way: "INTRO OFFER: Unlimited Cashback Match for all new cardmembers—only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards."

No upgrade path to another credit card

The Secured Chime Visa® Credit Card can help you strengthen your credit, but once that happens, there's no higher-tier unsecured card to move to. If you decide you're ready for a credit card that offers better rewards and benefits, you'll have to open up a new account with an entirely different issuer, which will often trigger a hard pull on your credit.

The aforementioned Discover it® Secured Credit Card, on the other hand, has a well-defined upgrade path. After you’ve had it for seven months, Discover will start reviewing your account each month to determine if you’re ready to shift to an unsecured card.

It doesn’t provide practice for managing more traditional cards

The Secured Chime Visa® Credit Card makes it very easy to stick to a budget and pay your credit card bills on time. This is good news for your credit scores, but any credit card you eventually graduate to will function very differently.

Once you start using an unsecured credit card, the training wheels come off in a major way. Revolving credit cards allow you to spend up to your credit limit, make just a small minimum payment while taking on debt and then spend up to the limit again. And if you make a late payment, you could get slapped with a late fee, a higher interest rate and a big dip in your credit scores.