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Flexible Credit Building
What’s the difference between Credit Building and Flexible Credit Building?
What’s the difference between Credit Building and Flexible Credit Building?
Anita avatar
Written by Anita
Updated over a week ago

Both Credit Building options work together to help you build your credit history, but they operate differently.

Credit Building with KOHO is a way to improve your credit score without putting up any collateral. We provide you with an unsecured credit line of $225 and make monthly payments on your behalf, which are reported to the credit bureau. This is a great option for those who prefer a hands-off approach to credit building and want KOHO to handle the process for them.

Flexible Credit Building offers a secure and effective way to establish and improve your credit score. It involves setting up a deposit between $30- $500 using your own money, which is then converted into a line of credit. Every month you spend from and repay your line of credit, we’ll report your activity to the bureau which establishes and grows a positive credit history. This option is ideal if you want to have complete control over your credit growth and have the money to do so.

Is it beneficial to register to both Credit Building features?

Both Credit Building features work together to build your Credit History! When you subscribe to Credit Building, you receive a line of credit from KOHO and only need to supply the subscription fee upfront. Flexible Credit Building requires you to have money to set aside as a deposit but offers more control over your credit growth.

Subscribing to both Credit Building features can supercharge your credit history. Using both gives you not one, but two(!) different trade lines, which positivity impacts your credit score calculation in a few ways:

  • You’ll have a larger total amount of credit available to you. This can be beneficial by demonstrating responsible use of the credit you have and lowering your overall utilization rate.

  • You’ll have two types of credit, which increases your credit mix.

  • When you borrow and repay both lines, your credit report will have a bigger history of positive repayments. Lenders like to see this!

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