The Progress Card by Capital One: Helping Consumers Rebuild their Credit
Although there are many credit card companies that are trying to distance themselves from those consumers with bad credit, there is one card that is specifically designed for credit card customers that have a less-then-stellar credit rating.
Capital One recently introduced the Progress Card, which will be available around Christmas. This card features no interest rate and incentives for paying on time.
Like any other card designed for individuals with bad credit, the interest rate is quite shocking. In fact, it may start as high as 34.9 percent. However, most individuals have few options when it comes to rebuilding their credit or being approved for a credit card.
Incentives to do Better
It is important to note that, although the Progress Card has a super-high interest rate, credit card customers can work toward lowering their interest rate, simply by paying their bills on time and paying more than the minimum payment.
For example, if you pay your bills on time for six months, and pay at least the minimum payment during that time, you will be eligible to have the interest rate reduced by five percent. As you continue to pay your minimum payment, on time, you can expect to see a five percent increase every six months. Pay on time for 18 months and that 34.9 percent interest rate is now down to 19.9 percent.
Capital One may also offer consumers an increase in their credit limit by their fourth statement if they display responsible card usage.
Working Towards a Better Credit Rating
The Progress Card, true to its name, enables individuals with bad credit to make progress and work toward a better credit rating. This card provides consumers with the tool necessary to begin building a positive credit history and credit rating.
For many individuals that have been adversely affected by the economy, the credit card crisis and the near-collapse of the housing market, this card could have not come at a better time.
Perhaps more credit card companies can take a lesson from Capital One and discover that many otherwise-responsible consumers need a second chance at rebuilding their credit and rebuilding their lives.
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