One's credit rating is indicative of one's fiscal well-being. Lenders like credit card firms, banks, and businesses like mobile phone carriers all utilize this standard check. Credit reference agencies are mined for data to determine if you are a responsible borrower and billpayer.

A copy of your credit report can be obtained from any of the UK's credit reference organizations upon request. Inaccuracies in your credit history can be easily corrected by requesting a free copy of your credit report. You could lose points for making such mistakes.

Raising a low credit score to a good one can be challenging. In this article, we'll show you how to improve your credit score without opening a credit card account.

7 Ways To Build Credit Without A Credit Card

Credit cards are one of many choices when establishing or improving your credit history. Credit card purchases and payments are a major factor in a person's credit score, but there are other ways to determine if they are creditworthy.

Credit can be built if payments are made on time and the debt-to-available credit ratio is low (preferably around 30 percent).

1. Try A Credit-Building Loan

Getting approved for a conventional loan with a low credit score or a "thin" credit record might be difficult. A credit building loan is designed specifically for this purpose.

Credit builder loans are short-term unsecured loans that typically range from $300 to $1,000. You will need instant access to the funds like a traditional loan. Instead, you make fixed monthly payments until the loan is paid in full (less any costs), and then you receive the remaining income.

A credit builder loan can help you establish or improve your credit history with timely payments that don't strain your budget. Your credit score will rise due to your timely payments being reported to the major credit bureaux.

2. Apply For A Personal Loan

Making on-time payments and repaying the loan in full as quickly as possible will help you build credit without applying for a credit card. Although the interest rates on these loans are often higher than those of credit-building loans, they can help you get your financial footing if you have a low credit history or have failed on loans.

However, before committing to a personal loan, ensure you can repay it. If you can make your loan payments when due, it will positively impact your credit score.

3. Pay Back A Current Loan

Your credit score can rise if you make on-time payments and don't default on your current loans, including student loans. If, for instance, you are now working to repay student loans, and you are doing so by the loan's terms, this can benefit your credit score.

4. Take Out A Credit Builder Loan

Like personal loans, car loans, and mortgages, a credit builder loan has a fixed monthly payment. Credit builder loans work like traditional loans in that you borrow money, but the money becomes yours once you repay the loan.

Your timely payments on a credit builder loan are recorded and shared with the credit reporting agencies, which might increase your credit score. We don't recommend credit builder loans because you will only have access to the funds from your loan once you repay it.

5. Pay Installment Loans On Time

Whether it's a school loan, personal loan, car loan, or mortgage, chances are you already have at least one installment loan. Moreover, if you still need to get one of these loans in your name, you can expect to apply for one somewhere in your early twenties.

Although federal student loans can be obtained with little trouble regardless of credit history, auto loans may require a cosigner with an established credit history, such as a parent or other close relative.

Making timely payments on your installment loans will help improve your credit score. Making monthly loan payments on time and in full can help you build a solid credit history.

6. Rent Payments Can Be Credited

Renters with a good payment history may benefit from using a service like Rental Kharma or Rent Reporters, which shares that information with major credit bureaux. These services often have a signup and monthly fee and require verification with your landlord. Rental Kharma's setup price is $50, followed by $8.95 monthly, whereas Rent Reporters' is $94.95 upfront and then $9.95 monthly.

It's a good idea to double-check with your landlord before signing up for anything to see if they already record your rent payments to the credit agencies. This has the dual benefit of lowering your spending and improving your credit rating.

7. Enquire About A Secured Credit Card

Since applicants for secured credit cards are required to put up collateral in the form of a cash deposit, the approval requirements are less stringent than for unsecured credit cards. For example, if you deposit $200, you'll have $200 in credit; if you deposit $500, you'll have $500 in credit; and so on. In theory, secured cards are like debit cards, but they are backed by your cash deposit instead of your bank account.