Finding favor with a credit card issuer if you have low or no credit can be difficult, if not impossible. But there are a few options available, including the Tomo Credit Card. This unique credit card doesn’t have an APR, late fees, or annual fees. Plus, it doesn’t require a credit score to qualify.
But is the Tomo Credit Card really worth it? Let’s break it down in this Tomo Credit Card review. We’ll examine all the major card details, explore how the card affects FICO scores and other credit scores, and more.
What Is the Tomo Credit Card?
The Tomo Credit Card is an alternative credit card that may be helpful for individuals with no or poor credit. When you apply for a regular credit card, you often have to have a good credit score or at least a credit score over a certain limit.
In contrast, the Tomo Credit Card looks at factors other than your credit score or available credit. Instead, the Tomo credit card checks the raw financial information from your checking and/or savings account or other asset account information you have. By using bank account information, the Tomo card is accessible to individuals with less than stellar credit but who still need a line of credit for purchases or emergencies emergency assistance.
The Tomo Credit Card is further different thanks to its payment system. Rather than paying a minimum monthly payment plus interest, the Tomo card platform has you make a weekly payment using an autopay system. This prevents you from carrying a balance on the card since you pay off the balance in full at the end of each week.
As you may imagine, the Tomo Credit Card is best used if you want to build credit or need an accessible line of credit without a credit score.
What’s the Credit Limit on the Tomo Credit Card?
The Tomo Credit Card has a limit to its line of credit. This is between $100 and $10,000 based on your personal information, such as how much money you have in your checking and savings account and how much money you bring in each month.
What’s the APR on the Tomo Credit Card?
By far the most interesting feature of the Tomo Credit Card is its lack of APR or interest rate. That’s right; with the Tomo card, you only ever pay back what you use from your line of credit. You don’t have to worry about interest adding to your expenses over time or how much money you’ll pay in the long run if you only make a minimum monthly payment.
However, the card does require you to make weekly automatic payments every Monday. The payments are always as much as whatever balance you have on the card, so there isn’t much flexibility.
For example, say that you use the Tomo Credit Card to spend $500. When your next automatic payment is made, it will be for the full $500 balance on the card. The card won’t carry a balance, thus avoiding the need for an interest rate or APR.
If you don’t have the funds needed to pay for your credit card balance, your account is frozen and you may lose access to the rest of your line of credit. Therefore, you have to use this credit card carefully and wisely if you can afford it.
Does the Tomo Card Have an Annual Fee?
No, nor does it have any sign-up or ancillary fees. In fact, applying for and signing up for the Tomo Card is quick, simple, and affordable no matter what your financial situation is. All you need is your ID and financial information.
Once again, note that instead of paying a late fee, your account will be frozen if you don’t make your weekly payment on time in the full balance on the card. This highlights the importance of only using the Tomo Credit Card for amounts that you are certain you’ll be able to pay back at the end of the week.
Does the Tomo Card Have Rewards?
The Tomo Credit Card doesn’t have any major welcome offer, which is a common feature for credit cards. However, it does have a 1% cashback rewards program for each payment you make with its line of credit. Instead of getting rewards from select merchants, all eligible purchases get 1% cashback.
Of course, this isn’t as high as the cashback rewards rate for many other credit cards. But it’s still a great way to earn a little extra cash credit by using the credit card frequently. You won’t be able to strategize making purchases in select categories for higher cashback rates, however.
Can the Tomo Card Help You Build Credit?
Yes! In fact, the Tomo Credit Card is expressly designed to help you build credit since it reports to each of the three credit bureaus. It’s a good type of card for starter credit and for building great credit habits over time with its automatic payment schedule.
Each time you make an on-time weekly payment toward your credit line, that information is reported to Experian, Equifax, and TransUnion. TomoCredit does not do a credit check when determining approval.
Plus, since you don’t carry a balance, your credit isn’t hit by potential late payments. If you use the Tomo Credit Card responsibly, you can build credit potentially more quickly than when using any other credit card available.
Why the Tomo Card Has Mandatory Autopay
The Tomo Card has a mandatory autopay feature because it doesn’t charge you interest. This is the only way that the card provider can make sure its debts are repaid. Furthermore, the Tomo Card doesn’t have any late fees.
The mandatory auto pay is designed to make sure that users don’t take advantage of the card’s lack of fees and APR. On the plus side, the autopay feature means you don’t need to remember to pay off your card’s balance. It’ll happen automatically at the end of each week!
As a drawback, this does mean that the Tomo Card can’t be used for some of the same operations or financial tricks as other cards, like standard Mastercard and Visa cards. For example, you can’t do a balance transfer with the Tomo Card to adjust bank account balances.
Do You Need Credit History To Qualify for the Tomo Card?
No. Instead, you need to link a checking or savings account to your line of credit. This account will be used for the automatic payments put toward your credit card balance at the end of each week.
TomoCredit, the card provider, accepts other data points to determine card user eligibility. This includes the bank account balances you have in your checking and/or savings account and how you manage the money frequently. Other data points, such as how frequently you are paid, may also be taken into account during the approval process.
If you have less than stellar or no credit but have good financial history aside from that, you will likely be approved for the Tomo Credit Card. You don’t need to make a security deposit, either.
Can You Get a Tomo Card With Bad Credit?
Yes. However, you need to have a good financial history besides your credit to qualify. For example, having a checking and savings account is a good sign, as is having plenty of money in your savings. If you get paid regularly, you’ll also be more likely to be approved for a credit card.
Of course, having good credit certainly doesn’t hurt. But it’s not strictly necessary to qualify for the Tomo Card, which distinguishes it from other credit card options.
Is the Tomo Card Better Than the Petal Card?
That depends on what you need. The Petal Card is also very accessible and designed to help you build credit. However, the Petal Card does require a credit score (usually 690 or above). Plus, any balance you carry will increase due to an interest rate.
The Tomo Card could be better if you have subpar or no credit and you want to be able to carry a credit balance without paying interest. It’s also ideal if you only make small, affordable purchases on credit cards and want to build credit rapidly. Remember, the Tomo Card reports to the major credit bureaus on a weekly basis. That’s better than many of the best credit cards with monthly payments and high card rates.
What’s the Bottom Line on the Tomo Card?
Ultimately, the Tomo Card is an excellent credit building credit card for individuals with low or no credit. However, it’s not the best for carrying long-term balances. You are unable to carry a balance on the card for longer than a week, so it’s only suitable if you have good cash flow or savings.
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Sources:
Credit Reports and Scores | USAGov
