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In the current financial state of the world, your credit score means everything. It helps you to take out bank loans on low monthly payments among other special financing schemes.
A credit-builder account or credit score is a track record for the bank to assess and predict your financial future. So, how does it relate to an online shopping service like Amazon?
Quick Summary
To answer your questions, we will be looking at the following things in this article:
- What is Amazon Credit Builder?
- How does it work?
- Advantages and Disadvantages of Amazon Credit Builder
Without further ado, let’s get started.
Amazon Credit Builder
A lot of major credit bureaus work on the basis of credit limits and credit scores. Each of these things is tied to a single person.
A credit score is similar to a report card that a bank or a bureau uses to assess your performance. You get different treatment and benefits based on this performance.
As the world transforms into a digital landscape, the online markets look for new ways to make sure that their customers get the most out of it.
Due to this reason, Amazon has developed a number of money management tools like Amazon Pay.
One of these tools is the Amazon Credit Builder.
Amazon has partnered with Synchrony Bank to develop a secured credit card. It is designed for not just credit scores but alternative credit data as well.
Just like any other bank, you are able to make eligible purchases with a bill payment history. Since a lot of banks don’t provide store card features, Synchrony Bank acts as an intermediary for your credit score and monthly payments.
What is Credit Score and Credit Limit?
Let’s check out both these concepts.
Credit Score
The concept of Credit Score is quite simple.
Let’s say you are in a school.
How does a school assess your performance over a certain period of time?
They assess it with the help of a grade sheet.
It shows your strong and weak areas.
Just like that Credit Score is your grade sheet but for a bank.
It shows multiple things.
These things include your security deposit, bank balance, loan status, foreign transaction fee, and credit history among other things.
It enables the bank to predict your behavior and conclude if you are going to meet your minimum payment requirement on your credit cards and loans as well.
Moreover, the customer data also allows the bank to develop rewards points. This helps them to reduce the risk of dealing with delinquent accounts.
Credit Limit
The next aspect of credit score is the credit limit. This is basically a filter that enables the bank to avoid any fraudulent activity or larger purchases that can otherwise harm a user.
When you buy a credit card, your credit card information includes multiple things. One of these things is the Credit Limit.
To ensure responsible use, the bank puts a limit on your starting balance. This allows new cardholders to better understand their financial product.
So, how does credit score affect your credit limit?
Once you get through the trial deposits stage, every purchase you make adds to your credit score. Every charged interest adds to your credit score.
In simple terms, anything you do with your credit card or bank account is added to your credit score. It can either be negative or positive.
This helps the bank to make precise financial decisions related to your account. A high credit score means that you are good on your down payments and monthly installments.
A low credit score means that you are often late with your installments. This impacts the bank’s decision when they are offering you a loan.
A high credit score customer will get better offers and interest rates while a low credit score customer might not even get the offer to avail a small loan.
Amazon Credit Builder Account
People who have an eligible Amazon Prime membership can apply for the Amazon Credit Builder Trial Deposit service.
Since Amazon has paired up with Synchrony Bank, they are giving an electronic funds transfer utility for people with limited or non-existent credit scores.
They can use an Amazon Prime secure card to make purchases with a free credit reporting system provided by Synchrony Bank.
Moreover, you can get free FICO score access to keep your security deposit submission in check. It is quite handy especially when you purchase on credit.
You can easily make an Amazon Credit Builder Account and start to build credit. All you have to do is pay a small amount of the annual fee.
Amazon Prime members only have to provide their personal information so that it can be integrated with the Synchrony Database.
After your first deposit has been successfully submitted, you can do Amazon.com purchases. But you have to provide accurate information to avoid any additional inquiries.
Furthermore, you can get deferred interest finance offers from other banks once you get a stable credit line.
Amazon Secured Credit Card
Once you fulfill all the requirements, you can then do eligible purchases through your Amazon Prime secured card.
The Amazon store card does charge an annual fee per the company’s guideline but it comes with an increased ‘Purchases Rewards Rate’.
Your Amazon Prime store card has its statement credit like other retail cards which you can use to earn rewards like gift cards on Amazon.
This is a part of the promotional financing offered by Amazon to push users towards a rather secured way of credit building.
You also get access to Synchrony Bank reports as an Amazon Prime member to maintain accurate information about your credit line.
In the current market, many retail cards prefer special financing offers for people with good credit history.
The concept of Amazon Credit Builder is to help people looking to build or rebuild their credit score from scratch.
The issuer guarantees that a smooth funds transition between you (the customer) and the merchants.
Furthermore, the credit information is collected independently by the bank through reasonable efforts. This is to make sure that there is no possible fraudulent activity.
Amazon cardholders also get a notification email once their purchases are approved to make sure that they have everything on record.
You can also message both of these companies to get more information about the whole thing without paying a single penny.
The Amazon customer care department automatically directs all additional inquiries to the bank to make sure that all your concerns are being overlooked by professionals.
Amazon Secured Card Account and Scams
Recently, a lot of people have been reporting through social media posts and to Amazon care service as well about suspicious messages.
A new wave of scammers has been trying to steal people’s personal information through suspicious emails.
Several users have shown their concern about the action required to avoid this.
Many have reported that they got three separate messages or a suspicious email blast saying that their account is at risk.
So what is this scam about?
The scam opens up with the subject line:
‘A successful trial deposit has been made from your Amazon account.’
Following is another example of a scam.
What does it mean?
A lot of people have fallen for it due to its careful structure and design. It is made to look like this email is from Synchrony Bank or Amazon itself.
In fact, the email is from a scammer who approaches you via call asking if you have received such an email.
Once you give confirmation to their question, they proceed to tell you that you are using an unsecured credit card and you need to secure it.
How do they do it?
By masking themselves as Amazon spokesperson, these scammers try to gain your trust and share your credit card information.
After they get your information, they will tell you that the unsecured Amazon card has been upgraded to a secure one.
While on the contrary, nothing happened in the first place. Your card wasn’t unsecured or had any issues.
Why does it happen?
This has been a frequent issue with Amazon CreditBuilder users. Mainly due to the fact that the service is new and people are susceptible to such things.
But Amazon and Synchrony Bank are taking radical steps to stop the highly alarming number of people affected by this scam.
What to do if I receive an email about monthly payments?
The first and foremost thing you need to do is read the email carefully. Make sure that the email is sent by Amazon or Synchrony Bank themselves.
This is the root cause of the scam and can be easily stopped right here. The whole scam depends on you not reading your email carefully.
What about an unsecured card?
The next thing to keep in mind is that even if you have an unsecured Amazon store card, you will be contacted via email from Amazon customer care rather than a voice call.
How does Amazon contact a user?
Amazon customer care never calls first to discuss any problem. People often misunderstand this as the company’s goodwill to contact their customers.
But Amazon doesn’t do this. If you are contacted by an Amazon representative regarding your unsecured/secured card. You need to be cautious.
What are other red flags?
The next red flag is the representative asking you for credit card information in one way or another.
Amazon customer care spokesperson never asks you about your credit card information. If you are being asked about it, it is most likely a scam.
What you should do?
You are always advised to use a second email for such purposes. This removes the possibility of you mixing up the important messages with scams like this.
Amazon has advised their cardholders to be more vigilant towards such trouble makers. In case of money or information loss, Amazon will not compensate them.
Wrapping Things Up
Amazon Credit Builder is a highly convenient service for people that need a fresh start with their credit scores.
It provides an independent service for people that are mostly buying stuff from Amazon. You can build credit scores in a positive way while making day-to-day purchases on Amazon. All you have to do is sign up for this service.
But lately, scammers have been trying to contact people with the Amazon Prime version. They usually target the credit card information of such people.
We hope this article proves to be highly informative for you.
Do let us know about the importance of credit building.
