Brigit Review

Limited Credit Card

Brigit

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5.0

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We’ve all been there at one time or another. A "must-pay" bill — maybe it’s the electric bill or the car insurance payment – is due in two days but your next paycheck won’t be hitting your bank account for five days.

Until recently, your only option (short of borrowing from family or friends) was going to a payday lender, a service which charges notoriously outrageous interest rates.

Over the past couple of years, a new category has emerged in the credit marketplace, offering consumers a safety net from overdrafts and late payments. One such product is CardName, which can provide account holders with loans of up to $250 and even has the ability to sense when you might be running low on cash.

HOW DOES BRIGIT WORK?

CardName is a financial health app for your smartphone that works in conjunction with your bank account and your existing bank card. It offers multiple tools to help with budgeting and improving your credit score.

The tools with the most impact are Brigit’s Advances and Credit Builder options.

By synching with your bank account, Brigit can track your transactions and get a sense of your financial habits, including regular deposits and monthly payments. By monitoring your transactions and watching your balance, Brigit can predict if your account will have insufficient funds to cover the upcoming bills and can automatically deposit an advance of $50 – $250 to cover the shortfall. That advance is then repaid when your direct deposit paycheck hits.

There is no minimum score required to sign up for Brigit. However, your bank account needs to have been active at least 60 days and you need to have a history of having a positive balance in the account one day after your direct deposit. Your history will also need to show at least three recurring deposits from one employer, totaling at least $800.

Brigit determines how much of an advance you qualify for based on what it calls your "Brigit Score." Basically, it’s a score based on your bank account activity – deposits, expenditures and balances. Your Brigit score is updated every time your bank provides an update, generally two times a day.

If you don’t want automatic advances, you can turn off that feature and make manual advance requests when needed.

The Credit Builder is an exciting feature that is best described as a loan/savings account hybrid. Brigit opens a $600 loan account for you, to be paid back in monthly installments over 12 ($50 payments) or 24 months ($25 payments). The proceeds of the loan are placed into a new, FDIC-insured account with Coastal Community Bank.

Each month, your payment is divided into two parts. You choose how much you want to contribute (at least $1) and the rest is paid from the loan proceeds account. Every month, your successful payment is reported to the three major credit bureaus.

At the end of the loan term, you will have successfully paid off a loan and whatever funds remain in the loan proceeds account will be transferred to your checking account.

WHAT ARE THE BENEFITS OF BRIGIT?

CardName‘s various tools provide excellent resources to help improve your overall financial health. Beyond the Advances and Credit Builder options, you also have budget tracking tools, credit alerts and fraud protection.

Brigit also provides protection against late payments and overdraft fees, two things that are the bane of the existence for anyone living paycheck to paycheck.

CAN BRIGIT HELP RAISE YOUR CREDIT SCORE?

Unfortunately, the advance repayments, made when your paycheck hits your account, are not reported to the credit bureaus. However, the loan payments made through the Brigit Credit Builder program definitely are and the impact of 12 or 24 consecutive on-time loan payments on your credit score can be significant.

Also, by avoiding late payments via the Brigit Advances, you avoid potential negative reports to the credit bureaus.

WHAT ARE THE POTENTIAL DOWNSIDES OF BRIGIT?

CardName is not free. While some of the budgeting tools are available by simply downloading the app, features such as Advances and the Credit Builder are only available with a Brigit-plus subscription, which costs $9.99 a month. While that may sound expensive, it’s easily offset by the money you could be save by avoiding overdraft and late payment fees.

Another potential pitfall of Brigit is how dependable and effective it is. That is to say, if you’re not mindful, it could be easy to fall into the habit of "deficit spending" by relying on the Advances and spending ahead of your income instead of getting on top of your monthly budget.

If privacy is a big issue for you, an app like Brigit may give you pause, as it requires you to provide access to your bank account.

Speaking of your bank account, Brigit does not yet presently work with joint bank accounts.

HOW DOES BRIGIT COMPARE TO SIMILAR OFFERINGS?

Brigit vs. CardName

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These two products seek to achieve the same goal but go about it in very different ways. The CardName is similar to the Brigit Credit Builder, however, with Self you must pay an APR on your loan.

The second layer of credit building with Self is the Secured Visa Credit Card. Your security deposit and spending limit is equal to however much you have paid into your Self-Credit Builder Account toward your loan. Again, you are subject to a variable APR if you carry a balance.

Brigit charges no interest on its Credit Builder loan or Advances but does charge a $9.99 monthly membership fee.

While Brigit works with your own bank account and debit card, Self requires that you open a new account with them. However, it also provides a pathway to graduate from the secured Visa card to an unsecured card.

Brigit vs. CardName

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To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Chime® Checking Account. The qualifying direct deposit must be from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR Original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to which Chime deems to not be a qualifying direct deposit are not qualifying direct deposits. Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A. The secured Credit Builder card is issued by The Bancorp Bank, N.A. or Stride Bank, N.A.

While Brigit connects with your existing bank account and debit card, CardName requires that you opening a new, online spending account with Stride Bank. You can then transfer an amount of your choosing from your spending account into your Chime® Credit Builder account. This amount serves as your spending limit for your Secured Credit Builder Visa Card. While this amount can be increased or decreased at your pleasure, there is no path available to graduate to an unsecured card.

Chime has no annual or monthly fee and does not charge interest¹ on purchases made with your Secured Credit Builder Visa. Brigit charges a membership fee of $9.99 for access to its premium features.

While Chime does have tools that help consumers with their budgeting and fiscal health, it has nothing similar to the Brigit Advances and Credit Builder features.

Brigit vs. CardName

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While both of these products are available to consumers with little or poor credit and provide pathways to improve your credit score, they do so in completely different ways.

Brigit is a financial health app with a monthly membership fee ($9.99) that closely monitors your banking habits and helps you avoid overdraft fees and late payments through its Advances feature (see above). Its turbo-charged Credit Builder feature provides a no-risk method of stringing together 12-24 on-time loan payments (reported to all three major credit bureaus) and walking away with a few hundred dollars cash when the payments are completed.

Secured Sable ONE Credit Card is, in many ways, a standard secured credit card, with several added benefits. There is no minimum deposit. You can deposit as much as $10,000 to set your initial spending limit.

With on-time payments, you have a chance to graduate to an unsecured card in as little as four months.

CardName charges no annual fee and no late fees. You pay RegAPR on new purchases. Among its benefits, Secured Sable ONE is a "cash back" card. You earn 2% cash back on purchases at Amazon, Uber, Uber Eats, Whole Foods, Netflix and Spotify and 1% cash back on all other purchases. Plus, Secured Sable ONE will match, dollar for dollar, all the cash back you have earned in your first 12 months as a member.

Other benefits include cell phone insurance, car rental insurance, new purchase insurance and price protection.

WHO IS BRIGIT A GOOD FIT FOR?

CardName is an excellent option for anyone looking to build or repair their credit score. The Credit Builder program is a nearly risk-free way to string together 12-24 on-time loan payments, which can have a significant impact on your credit score.

Brigit is also an excellent app for someone who lives paycheck-to-paycheck and worries about overdraft fees and late payments. With Brigit’s Advances feature, the app keeps track of your spending habits and deposit history and is able to predict when your account might be a little short. When that happens, Brigit issues you an advance of $50-$250 to make sure you can cover the bill. That money is paid back when your next direct deposit hits your account.

¹Out-of-network ATM withdrawal and OTC advance fees may apply. View the Bancorp agreement or Stride agreement for details; see back of card for issuer.