How to get installment cards with a poor credit history

Is there a probability of getting a card with a bad credit history

No, there is no such probability. Every credit institution, in accordance with legislative requirements and the regulations of the regulator represented by the Central Bank of the Russian Federation, is obliged to study the financial profile of the borrower. Since 2005, such information has been contained in the BCH, or Bureau of Credit Histories. Every Russian citizen who has ever taken out a loan or used another banking product from an MFO or bank is entered into the database. Thus, obtaining installment cards with a bad credit history will only be possible after the bank's scoring system processes your request for a banking product and checks the data through the BCH database.

Credit history contains the necessary data on the borrower, including information on their repaid and overdue credit obligations. A bad credit history can also affect the bank's decision to issue funds, but only in one case: if there are current outstanding obligations. For those who have data from past periods, a special scoring system has been developed that analyzes the borrower's reliability based on certain criteria. Each borrower has their own score, based on which the credit organization makes a decision to approve or deny the issuance of funds.

What to do if there is no credit history

As a rule, such borrowers initially have a bad credit history, meaning there is a signal that no one knows what financial actions the borrower has taken. Typically, these categories include adult borrowers who have turned 18, as well as those who for some reason have never taken out a single loan in their life.

However, for installment cards with a bad credit history, in the absence of such information, the bank may make a positive decision, but there are a number of restrictions:

• The absence of current credit debt is a big plus for such a borrower, but the lack of any information lowers the degree of trust from the financial and credit institution.
• Upon the first application, the borrower gives consent to review the information in the credit history bureau (CHB) database, but it is impossible to get a response since there is no data in principle, which deters the lender.
• If the bank takes the risk of working with such a borrower, the initial credit limit will be close to the minimum.

However, even in this case, a refusal may occur, as banks are reluctant to accommodate such borrowers. What is the way out in this case? It is recommended to apply for a consumer loan or a microloan. Microfinance companies will also carefully consider your candidacy, but still, there is a chance that you will get 100% approval. Next, you need to repay the loan; you can take a second loan and successfully repay it as well. Next, you will have a situation where your credit history improves for the first time. This will allow banks, in turn, to approve a loan or installment card for you. The approximate waiting time for this option, if you take out a loan, will be 3 months. During this period, you acquire an improved credit history.

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The presence of overdue payments as an element of a bad credit history

There is an additional category considered for installment cards for those with a poor credit history if there are overdue payments. In this case, the lender looks not at the delinquency itself, but at its severity. Even if you have made payments, if there are clear instances of being overdue, you develop a unique profile regarding the degree of your failure to meet financial obligations to the lender.

Please note that if you have active overdue payments, it is best to settle them as soon as possible. If a bank denies your credit application and suggests reapplying in 30-45 days, it is advisable to clear your overdue payments during this period before submitting a new application.

If you have overdue payments, the maximum credit limit on a card for those with a poor credit history will be 15,000 RUB. During this time, you must not allow any further delinquencies, and it is best to pay off the allocated limit early. If you fail to do so, your maximum credit limit will remain at the same level.

To increase the limit on an installment card with a poor credit history, you must do the following:

• Use the card frequently and consistently.
• It is advisable to use the full amount of your allocated credit limit for purchases.
• Repay your debt, preferably early.
• Do not allow any violations regarding the banking product.

If you meet all the necessary requirements, the bank will 'see' your commitment to improving your credit history, which leads to an increase in your credit line. In about 7-12 months, you may see the first results of an increased credit line, potentially reaching the maximum available for an installment card, including up to 300,000-350,000 RUB.

Do installment cards affect the formation of a bad credit history

Certainly, if you do not meet the minimum requirements for using the banking product, the lender will report the delinquency to the Credit Bureau (BKI), which negatively affects your credit history.

• If there are one-time overdue payments of no more than 10 days, the lender may not report the information to the BKI.
• If there is a persistent failure to meet payment deadlines, occurring 2 or more times, the bank will report the data to the BKI.
• After information is sent to the BKI, if the borrower corrects the payment situation, the records are updated, but the history of the delay remains as part of the information base.
• Constant failure to meet credit obligations negatively affects the borrower's entire credit history.

A borrower's level of responsibility is formed based on available data. Thus, if you have often been late but still made payments, your reliability rating increases. If you are constantly late, your trust rating decreases.

In general, all banks use their own scale to determine the level of trust for a borrower with a poor credit history.

Currently, the issuing banks that consider applications from those with a poor credit history for an installment card include the following organizations:

• Qiwi Bank. 'Sovest' installment card, 65-70% approval rate.
• Home Credit Bank, 'Svoboda' card, up to 60% approval rate.
• Sovcombank, 'Halva' installment card, up to 80% approval rate.

As you can see, banks approve more than half of the applicants who have a poor credit history.

Our financial services matching platform offers you the opportunity to apply for installment cards even if you have a poor credit history. You can follow the link to the issuing bank's official website, fill out an application, and wait for the operator's decision. Preliminary approval of the application will be announced no later than 10 minutes after submission. Within 1 hour (sometimes up to 24-48 hours), a bank operator will call you to provide exact information on your next steps for receiving the installment card. If you are denied, you will likely be asked to reapply in about 30-45 days. Try to request your credit history report during this period. You can request your credit history data for free once a year. If you encounter any difficulties, we will help you order a report from the credit bureau.