Best Unsecured Credit Cards for Bad Credit for May 2023

When you have bad credit (a credit score typically around 580 or lower), there are just two types of credit cards that you can qualify for. The first are secured credit cards. These cards act like standard, unsecured credit cards, except that you have to submit a refundable security deposit before your account can be opened. 

The other type are unsecured credit cards for those with bad credit. These cards don’t require the payment of a security deposit, but they do have other costs. Because of the higher risk associated with borrowers who have bad credit, most of these cards will have a higher interest rate and higher annual fees compared to cards marketed towards those with higher credit scores. 

However, if you have a fair credit score (typically ranging from 580 to 669) or no credit history at all, you may have a wider range of credit cards available to you, with more favorable terms, such as lower interest rates and lower fees.

Our recommendations:

Best overall: card_name

The card_name is our best overall unsecured credit card for people with bad credit because it combines several desirable features. First, it has annual_fees annual fee and no foreign transaction fees, which is rare for a credit card for people with bad credit. It also offers cash back for purchases from select local and national merchants. Applicants can expect a credit limit of between $300 and $5,000, which is generous for cards of this type. 

Petal can do this because it utilizes alternate credit data, such as bank account information, in order to offer credit to some people with bad credit who might not qualify for competing cards. 

Best for earning cash back: Credit One Platinum Visa For Rebuilding Credit

CreditOne Bank specializes in offering unsecured credit cards to applicants with bad credit, and its Platinum Visa For Rebuilding Credit offers 1% cash back rewards on eligible purchases. Qualifying purchases can include gas, groceries, mobile phone and internet service, as well as cable and satellite TV services. However this card does have a $75 annual fee the first year, which becomes $99 the after that, billed at $8.25 a month. But with on-time payments and little debt, you may qualify for a card for those with fair credit within a year. 

Best for low annual fee: card_name

Prosper offers the card_name for those with bad credit that doesn’t require a security deposit. It has a low, annual_fees annual fee. Other benefits include instant access to 50% of your available credit while waiting for your card to ship to you. Prosper also regularly reviews your credit for potential credit line increases. 

Best for travel: card_name

The card_name is a very simple card that’s designed for those who have had problems with their credit. Like all Capital One cards, it’s a great option for travelers, as there are no foreign transaction fees. It offers emergency card replacement and there is <annual_fees annual fee for this card. 

Best for no annual fee and high credit limit: Tomo

Tomo credit is another card issuer that approves applicants based on information other than a traditional credit score. That’s one of the reasons it's able to offer a credit card with no annual fee for applicants with bad credit. However, Tomo requires you to link your bank account and set up autopay, and it doesn’t charge interest rates. So it’s not a card for those who need to borrow money. There’s no annual fee for this card.

The Tomo credit card can offer limits of up to $10,000 because it approves applicants based on information other than a traditional credit score. Just keep in mind that Tomo requires you to link your bank account and set up autopay and doesn’t charge interest rates. But if you have a high balance in your bank account, then you might receive a high credit limit from this card. There’s no annual fee for this card.

Best for fair credit: card_name

When your credit improves enough to be considered Fair, then you should take a close look at the card_name. This card offers 1.5% cash back on all purchases, with no limits. There’s a annual_fees annual fee for this card, and no foreign transaction fees. 

Best for no credit: card_name

The card_name is also our top card for those with no credit history. That’s Petal because Petal utilizes alternate credit data, including your bank account information, rather than rely on traditional credit information. It also has annual_fees annual fee and no foreign transaction fees, and it even offers cash back for purchases from select local and national merchants. 

Best to rebuild credit: card_name

The card_name isn’t just a credit card, it’s part of an entire system for rebuilding credit. To receive the credit card, you first need to open a Self Credit Builder account. You then have to make three monthly, on-time payments and have $100 or more in the savings. However, you need no additional security deposit and accounts in good standing may have their credit limit increased. With both the Self Credit Builder account and the Self Visa credit card, you may be able to rebuild your credit even faster than you thought. 

Methodology

To find the best unsecured credit cards for people with bad credit, we looked through all of the credit cards of this type on the market. A review of the top cards was then conducted by one of the nation’s leading credit card experts with more than 15 years of experience. After review, the top cards for each category were selected. 

Types of unsecured credit cards

There are several types of unsecured credit cards available, but most will require a fair, good or average credit score. Of those remaining, there are those that are ideal for rebuilding credit and others that offer rewards such as cash back. Others have features and benefits that are suited towards travelers. 

A new kind of unsecured credit card for people with bad credit will use alternative sources of credit information. This allows card issuers to extend credit to those with poor credit, without charging as many fees as card issuers that only rely on traditional credit reports and credit scores.

How to select the best unsecured credit card for bad credit

Looking for the best credit card for bad credit is like shopping for many other things. You first have to decide which features and benefits are a priority. For example, you might be seeking a card for travel or a card that offers cash back. Other credit card users might be looking for a card with the lowest possible annual fee, or the highest credit limits. 

But regardless of how you plan to use this credit card, you’ll want to look out for the following things when shopping for an unsecured credit card. First, you’ll want to look carefully at the fees. Many of these unsecured credit cards will have high annual fees, and some may even have application fees. Other fees to look out for include foreign transaction fees, additional cardholder fees and balance transfer fees. 

Next, make sure this is truly a card for those with bad credit. Some cards are best for those with no credit, or for those with fair credit. However, the best card in the world is of no use to you if you can’t qualify for it. 

Finally, look out for the card’s standard interest rate. When you’re trying to rebuild your credit, you should be trying as hard as possible to avoid interest and debt by paying your statement balance in full each month. But if you need to carry a balance, you’ll want a card with a reasonable interest rate. But you shouldn’t expect to qualify for a card with a low interest rate if your credit isn’t good.

Frequently asked questions (FAQs)

Can I get an unsecured credit card with a 500 credit score? 

Yes, there are several unsecured credit cards that are offered to those with credit scores of 500 or less.

What is an unsecured credit card for bad credit?

These are cards that  are designed for people with bad credit. While many credit cards for those with bad credit, most require the payment of a refundable security deposit. Unsecured cards for people with bad credit may not charge a refundable security deposit, however many have significant annual fees.

Are secured or unsecured credit cards best for rebuilding credit?

Both types of credit cards can help you to rebuild your credit, so long as you use them responsibly. This means paying your bills on-time and carrying very little, if any debt. The difference is that secured credit cards require the payment of a refundable security deposit before your account can be opened, and are less likely to charge an annual fee. 

Can a secured credit card become unsecured?

Yes. Some secured credit cards will offer cardholders a refund of their deposit after consistently making their payments on-time, and avoiding debt. 

Can you get a credit card after bankruptcy?

Yes. You will have to qualify for a credit card designed for people with bad credit, like the ones mentioned in this article. 

How can I get approved for a credit card with bad credit?

It’s important to only apply for credit cards that are designed for applicants with bad credit. While these cards may require a security deposit, or charge a significant annual fee, you can still be approved. 

Can I prequalify for credit cards with bad credit?

Some credit cards for people with bad credit offer a prequalification process, which is sometimes called pre-approval. You can typically prequalify for a credit card without it having any effect on your credit.