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How does Secured Credit Building work?
Updated over a week ago

To start enjoying our Secured Credit Building feature, simply make sure you're already signed up for Credit Building!


What is Secured Credit Building?

With KOHO's Secured Credit Building, you can build your credit history using your own money. Think of it like a savings account that helps boost your credit. Here's how it works:

  • Put in $30 to $500 into your account to create a secure credit line.

  • Transfer these funds to your KOHO account for spending. It's best to use no more than 10% of your deposit.

  • On your next billing date, we'll automatically move the funds from your KOHO account back into your secure credit line. Just ensure the money is available in your Spendable.

  • Start improving your credit today 🎉!

Just remember to keep enough money in your Spendable for us to return what you spent, and we'll report this activity to Equifax, which can help boost your credit score.

With Secured Credit Building, you can also get access to our in-house Financial Coach!


How do I register?

To opt into our Secured Credit Building feature, you need to first be subscribed to Credit Building. The Secured Credit Building option is specifically offered as an additional feature to our existing Credit Building service.

Upon opting into Credit Building, all you need is to have your deposit ready, along with the required monthly fees, and then you can proceed to subscribe to Secured Credit Building!

  1. Open the KOHO app

  2. Tap the Credit button (bottom right), then tap on "Learn More and "Sign up for Secured Credit Building"


How much can I choose to deposit?

You can deposit anywhere from $30 - $500.


How long can I use this feature?

You can keep enjoying this service until you choose to cancel it through the app. We want to make managing your subscription as easy as possible for you, ensuring a smooth experience.

There's no time limit for how long you can use Secured Credit Building, but for the best results, we suggest staying subscribed for at least three months to fully benefit from this feature.


How will I know if it’s working?

Shortly after signing up for Secured Credit Building, you’ll be able to see your current credit score. Every month, once we receive and report your payment to the credit bureau, you'll see your updated credit score and how it has changed on the Secured Credit Building page.

The reporting is sent the following month to include the first month's activity. For instance, if you make payments in August, the reporting will be sent in September. Most members take three months to see improvements!


Can I change my available Credit Limit amount?

Certainly! You can change your available Credit Limit amount in the app. To do this, make sure you have the latest app version installed, and then follow these steps:

  1. Go to the "Credit" section in the app.

  2. Click on "Secured Credit Building."

  3. Find the ⚙️ icon in the upper right corner and tap on it.

  4. Select "Change security deposit 💰."

Just a quick tip: If you want to increase your deposit amount, ensure you have enough money in your Spendable. However, if you want to decrease your security deposit, you can't go below the amount you've already taken out from your Secured Credit Building account.


How do I withdraw funds from my Secured Credit Building?

Head to the Secured Credit Building dashboard from the Credit menu and click on "Move money".

Select the amount you wish to withdraw using the slider (we recommend no more than 10% of your total line of credit), click Move, and voila! The amount will be deposited to your account immediately!


When should I repay the funds withdrawn from my Secured Credit Building?

When you take money from your Secured Credit Building and move it to your Spendable balance, you'll need to pay it back every 30 days based on your billing date not based on when you moved the money out. For example, if your next billing date is September 5th, and you moved money out August 28, we will move the funds back to your Secured Credit Building account September 5th, not September 28th. If moving the full amount is not possible, the system will collect the minimum of $10 instead.

You have two options for moving the funds back:

  • You can move it back yourself in-app before the due date.

  • Or, you can let us automatically collect it on the due date.

Either way, just make sure you move it back within those 30 days to keep everything in order.


What happens if I miss a payment?

Just like how paying your bills on time helps your credit score go up, the opposite is also true. If you don't pay your bills on time, it will damage your credit history. If you don't have enough money in your account to cover your Secured Credit Building loan or fees, we will keep trying to collect the remaining amount every time you load money until it's all paid off.


How do I access the Financial Coach?

You can start a conversation with our Financial Coach in-app by asking your question and using #coach at the end of the message. Our Financial Coach can provide you with guidance on budgeting and saving.


How do I cancel this?

When you use KOHO to build your credit, you'll typically start seeing your credit score go up after 3-6 months. The longer you keep your credit line open, the more your credit history will improve.

To stop using Secured Credit Building, follow these steps:

  1. Open the KOHO app and go to the Credit tab.

  2. Select Secured Credit Building.

  3. You'll be taken to your Secured Credit Building dashboard. Simply click on the settings icon in the top right corner of that page.

  4. Choose “Cancel Secured Credit Building”.

Once you've canceled, any remaining amount in your Secured Credit Building line of credit will be returned to your account right away.

Heads up: Cancelling Credit Building won't impact your credit history, but your line of credit will remain open for 12 months after you cancel your subscription.


Subscription Refund Policy

All KOHO subscription purchases are non-refundable. See our Terms of Use for more details.

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