The Indigo Credit Card is a card designed for people who want to build or rebuild their credit score. It is an unsecured card, which means you don't need to pay a security deposit to get approved. However, it also comes with some drawbacks, such as high fees, low credit limits, and a few others.

In this article, we will review the features, benefits, and costs of the Indigo Credit Card and help you decide if it is a good option for you. We will also provide some tips on using the card responsibly and improving your credit history. So, let’s get right into it.

What is the Indigo Credit Card?

The Indigo Credit Card, offered by Celtic Bank and managed by Genesis FS Card Services, is specifically created for individuals grappling with poor or limited credit histories, aiming to bolster their credit scores. Unlike many cards targeting those with suboptimal credit, the Indigo Credit Card stands out by not necessitating a security deposit for approval. Prospective applicants can evaluate their eligibility through a brief online pre-qualification form without impacting their credit score.

However, certain drawbacks accompany the Indigo Credit Card. Users may encounter an annual fee ranging from $0, $59, or $75 for the first year, escalating to $99 subsequently. With a modest credit limit of $300, cautious spending is crucial to avoid maxing out the card, which could adversely impact the credit utilization ratio.

While serving as a valuable credit card for rebuilding credit, users should be mindful of its limitations, including high fees, low credit limits, etc. Though they're other things that you should also know about Indigo Credit Card. Fret not; we'll get into it later in this article. So, be sure to stick to it.

Why Indigo Credit Card?

If you're looking for a credit card to assist in improving your credit score, the Indigo Credit Card might catch your eye. Here’s the catch. It is perfect for individuals with poor or limited credit history seeking to build or rebuild their credit; this card has distinctive features. The Indigo Credit Card offers several advantages, making it an attractive option for those aiming to enhance their credit profile:

No Security Deposit Required

Unlike some counterparts, such as secured cards, the Indigo Credit Card doesn't mandate a refundable deposit for approval. This means there's no need to have cash upfront, providing a more accessible entry point for potential cardholders.

Pre-Qualification Available

One of the Indigo Credit Card benefits is that the prospective applicants can assess their eligibility for the Indigo Credit Card through a brief online form without impacting their credit score. This pre-qualification step helps avoid applying for cards beyond reach, preventing potential harm to your credit score due to unnecessary hard inquiries.

Monthly Reporting to Credit Bureaus

The Indigo Credit Card takes a proactive approach to credit-building by reporting payment activities to major credit bureaus like Equifax. The best part is that it has consistent, timely payments contribute to fostering a positive credit history, potentially resulting in an improved credit score over time.

No Foreign Transaction Fee

For those who prefer international online shopping, the Indigo Credit Card stands out by not charging any fees for transactions conducted in foreign currencies. This feature is particularly advantageous for travelers or those engaging in cross-border e-commerce.

After looking at these benefits, you can surely understand if the Indigo Credit Card is ideal for you or not. With that being said, let's also learn about some cons that can help you clearly analyze and help you make the best decision.

Potential Drawbacks of Indigo Credit Card

While the Indigo Credit Card comes with benefits tailored for credit building, it's essential to be aware of potential drawbacks that could impact your financial strategy:

High Annual Fee

Depending on your credit profile, the Indigo Credit Card may require an annual fee ranging from $0 to $99 after the first year. This fee diminishes your available credit limit, affecting your borrowing capacity. For instance, with a $300 credit limit and a $99 annual fee, your usable credit drops to $201.

High APR

The card carries a fixed interest rate of 24.9% on purchases and cash advances, surpassing the average APR for U.S. credit cards. Maintaining a balance can result in substantial interest payments.

Low Credit Limit

With a modest $300 credit limit, overspending may quickly max out your available credit. This can negatively impact your credit utilization ratio, a pivotal factor in your credit score. Keeping your spending below 30% of the credit limit is advisable for optimal credit health.

No Rewards or Perks

The Indigo Credit Card lacks a rewards program or additional benefits commonly found in other credit cards for individuals with limited credit history. Missing features such may limit long-term advantages.

Tips on Using the Indigo Credit Card Responsibly

To make the most of your Indigo Credit Card and build a positive credit history, follow these responsible usage tips:

Timely Payments: Ensure you pay your credit card bill on time each month to avoid late fees and negative impacts on your credit score.

Full Monthly Payments: Whenever possible, pay your balance in full each month to avoid accruing high interest charges.

Credit Utilization: Keep your credit utilization below 30% of your credit limit to positively influence your credit score.

Budget Wisely: Create a budget and use your card for essential expenses, staying within your means to prevent overspending.

Regular Monitoring: Regularly check your account statements and credit reports to spot any discrepancies or unauthorized transactions promptly.

Wrapping it Up!

The Indigo Credit Card is a card for people who want to improve their credit score and have trouble getting approved for other cards. It has numerous benefits, such as no security deposit, pre-qualification, etc. However, it has some drawbacks, such as high annual fees, APR, etc.

The Indigo Credit Card is not a card for long-term use but a tool to help you build your credit history. Once you improve your credit score, you can apply for a better card with more benefits.