A quarter (23%) of Brits have been denied credit due to their poor credit score. This equates to over seven million people across the UK. Moreover, around four in ten (43%) Brits want an easier way to build their credit score. Specifically, one that does not involve taking out new lines of credit.

A new app, using open banking, aims to enable consumers to build their credit score simply by spending on small everyday items, using the BuildMyCreditScore debit card.

BuildMyCreditScore is designed to improve outcomes for these individuals and others whose credit score is preventing them from achieving their financial goals.

Product will appeal to a number of market segments

It is aimed at a number of customer segments. Examples include someone who has recently moved to the UK, someone who hasn’t borrowed money before, or someone who has previously been declined for a financial product such as a credit card.

BuildMyCreditScore is a Mastercard debit card that allows people to build their credit score without changing their spending habits.

BuildMyCreditScore references its research suggesting that six in ten (58%) people in say they feel more comfortable using a debit card than a credit card for everyday spending. This rises to two-thirds (66%) among 18–34-year-olds. BuildMyCreditScore is an easy way to build their credit score without taking out a credit card.

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The debit card works instantly like a regular bank card. But the money is collected via Direct Debit by BuildMyCreditScore around two working days after. This allows transactions to be reported to credit reference agencies. Consumers therefore build their credit score by demonstrating their ability to manage rolling outgoings and repay credit promptly.

Credit scores boosted within three months in trial phase

In the pilot phase, BuildMyCreditScore has already helped hundreds of people improve their credit score. The app was tested by a pilot of 632 customers between December 2022 and June 2023. Of that number, the majority saw an increase in their credit score of between 11 and 55 points within the first three months of trialling the product.

James Lynn, CEO and co-founder of BuildMyCreditScore, said: “Having a strong credit score can be life changing. For many people it can open the door to opportunities they would never have been able to access otherwise. But the fact is, millions of people across the country have a low score and thin credit file. This is leaving them with less fair, less affordable options when it comes to accessing credit. This isn’t good enough.

“Traditional credit builder products typically rely on someone making prompt repayments on credit they’ve taken out. If they fail to do so for any reason, they risk falling into debt and harming their credit score further. BuildMyCreditScore’s innovative use of open banking disrupts this model. It integrates seamlessly with a person’s usual spending habits. This allows them to build their credit score in a safe, low-risk way through their everyday spending.”

The team behind BuildMyCreditScore has partnered with Mastercard to deliver multiple innovative debit card products in recent years.

Embodies the essence of open banking

Darren Deal, Senior Vice President for Business Development at Mastercard UK and Ireland, added: “At Mastercard, we are always looking at new ways to bring essential products and services to underserved groups. Now more than ever, people are looking for innovative solutions to help manage their finances. We’re pleased BuildMyCreditScore provides an opportunity for people to have more control over their financial futures.”

Richard Newman, Corporate Affairs Director, Open Banking Limited, said: “This initiative embodies the essence of open banking. It empowers individuals to seize control of their financial well-being. It allows them to elevate their credit scores effortlessly through everyday spending. And all without the necessity of acquiring additional lines of credit.

The card launches with three pricing plans: £7.95 per month, £7 per month (paid semi-annually), or £6.25 pm (paid annually).