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If you’ve been looking for options to build your credit, you have probably heard of Kikoff. It doesn’t work like other credit builder loans.
There are many products and services on the market designed to help a person with no credit or bad credit build a better credit record – we’ll dive into how Kikoff measures up.
How Does Kikoff Credit Builder Work?
Like other credit-building tools, Kikoff extends credit to you and places a new tradeline on your credit report. It then gives you the opportunity to pay your debt easily. That builds a positive payment record.
This process works in several steps:
- You apply for a credit line with Kikoff. There is no credit check. No hard inquiry will be placed on your credit record.
- Kikoff will extend you a $500 credit line. That is the only size available. This will be reported on your credit record as revolving credit, like a credit card.
- You can only spend Kikoff credit in the Kikoff store. The store sells a variety of ebooks on wellness and personal finance, at $10 and $20.
- You make purchases and pay them off in a series of 5-10 monthly installments.
- Kikoff reports your payments to Equifax and Experian, two of the three major credit reporting bureaus.
- These reports form part of your credit record and will help you establish or improve your credit.
- It may take up to six months for your Kikoff account to be reflected on your Experian and Equifax credit reports.
Kikoff charges no interest on the credit they extend, and there are no fees. Kikoff makes its profit on the sale of items from its store.
Is Kikoff Credit Legit?
Kikoff is legit. It does what it says it will do. You will get a revolving credit line. You will be able to make purchases, and your payments will be reported to two credit bureaus. That will help you establish a credit record.
Kikoff is a legitimate way to build credit. Whether it is the best way for you to build credit is another question. Let’s look at some details that will help you decide.
Important Details (Features, Fees, Penalties)
Kikoff’s main selling point is that it’s easy, simple, and cheap. It succeeds on all three levels.
The application is easy and straightforward. There is no credit check and they will extend credit to people with no credit record. You don’t need a bank account or an income. You do need to be over 18.
Kikoff does not charge interest and there are no fees. They will freeze your account if you fail to pay, but there is no fee for late payments.
The only cost is the price of the items that you buy in the store. We can’t assess those products because Kikoff does not disclose what they sell.
Pros: The Advantages of Kikoff
These are some of the positives we see in Kikoff’s model.
• It’s Easy
The application is simple and the requirements are minimal. Almost anyone can use Kikoff. The Kikoff app is free and available for both iOS and Android.
• It’s Cheap
Kikoff does not charge interest on your balance and there are no fees.
Because the purchases are inexpensive, your installments will be small. If you purchase a $10 item and pay in 5 months you will pay only $2 a month. That makes it easy to keep up.
• It’s Simple
The basic functionalities of the Kikoff platform are clear and easy to work through.
• It’s Designed to Build Credit
Kikoff’s credit limit is much more than you’re likely to spend on ebooks. That keeps your credit utilization low, which helps your credit.
Kikoff’s low monthly installments make it easy to pay on time. On-time payments are the single most important part of your credit score.
A Kikoff account doesn’t expire, so it will always contribute to the average age of your accounts.
• It’s Safe
Kikoff’s security features are fully compliant with federal law and will protect your privacy and user personal data.
Cons: The Downside of Kikoff
Like every other method of building credit, Kikoff has disadvantages. Here are some to consider.
• Kikoff Only Reports to Two Credit Bureaus
Kikoff reports to Experian and Equifax. It will not establish your credit record with TransUnion.
• You Can Only Use Credit at the Kikoff Store
If you don’t find the products useful, you will have to buy things you don’t want in order to build credit. This might be worth it if it’s the only credit line you can get, but you won’t want to keep doing it.
• You Will Have to Keep Buying
Active accounts have more impact on your credit than dormant accounts. If you want to maximize Kikoff’s impact on your credit you’ll need to make a new purchase once you’ve paid off the last one.
• It’s Not Available in Every State
You can’t use Kikoff in Delaware, Nevada, Indiana, South Dakota, or Rhode Island.
How to Use Kikoff
You’ll get the most impact from your Kikoff account if you use it strategically. Consider these recommendations.
- Buy one item at a time. Don’t make a second purchase until the first is paid off. You want to keep the account active without spending too much.
- Select the longest available payment plan. There’s no interest, so a longer-term won’t cost you anything. It will keep your account active.
- Make payments on time. You may wish to set up an automatic payment.
- Evaluate the items. Once you’ve read some of the ebooks, decide whether you find them valuable.
- If you like the items, keep buying one at a time. That will keep your credit line active.
- If you don’t like the items, move to a more versatile form of credit as soon as possible. You don’t want to spend money on items that you don’t find useful.
Kikoff will get you started with building credit. As you move on you will want to diversify your credit record with other accounts.
Is Kikoff Your Best Choice?
Kikoff will help you build credit. It may not be the best credit-building choice for everyone. Consider other options.
- Use a credit builder loan. Many credit unions and banks offer these products, or you can use an online lender like Self or Credit Strong. These loans are available with no or low credit. They place an installment loan on your record, which helps your credit mix, and at the end of the loan term, you have a lump sum of money.
- Get a secured credit card. Secured credit cards are available to users with poor or no credit. You can use them anywhere you want. You will need to have discipline to avoid overspending.
- Become an authorized user. Asking a reliable person to add you as an authorized user on their credit card can build your credit. You won’t have to spend anything. Be sure the issuer reports authorized users to the credit bureaus.
- Use a rent reporting service. Rent reporting services can place your rent payments on your credit record. Choose your provider carefully.
- Use your bill payments. Services like Experian Boost and eCredable Lift can put your utility bills on your credit record.
Here at Digital Honey, we recommend that you get three credit cards and one installment loan to boost your credit score to 800+. Having different account types on your credit report will build a diverse credit mix and strengthen your credit profile.
Kikoff is one of the most accessible forms of credit that you can find. There’s no credit check and you don’t need a bank account. The only requirement is imposed by government regulations: You have to be over 18 years old.
Kikoff is a legitimate credit-building product. It will not give you great credit on its own, but it’s an effective way for people with poor credit or no credit score to start their credit-building project.
One drawback is that there’s currently no way to review what’s available in Kikoff’s store. We can’t assess the value of the products to a customer because we don’t know what the products are.
The other big drawback is that it only reports to two out of three credit bureaus. This is a limitation that most credit building products don’t have.
Even with that drawback, the risk is minimal. If you sign up for Kikoff and buy a $10 ebook, you will have a credit account and 5 months of payments will be reported. The only risk is that you may end up with an ebook that you don’t like.
Because of that question mark, we can’t give Kikoff a full endorsement. Despite that gap, we’d rank Kikoff as an easily accessible and effective way to build credit with minimal risk.
If you have no credit score or you’re trying to rebuild your credit, Kikoff is certainly worth a closer look.
If you’re looking for a more effective way to build your credit, check out our Best Credit Builder Loans article.
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Steve Rogers has been a writer and editor for over 30 years, specializing in personal finance, investment, and the impact of political trends on financial markets and personal finances. His work has appeared in The International Herald Tribune, Foreign Affairs, and The Journal of Democracy, among many others. He has a particular interest in making complex topics accessible and useful to non-specialist audiences. When he’s not working, he can usually be found paddling kayaks, rappelling waterfalls, riding mountain bikes, or coming up with new adventures for his two boys. On rare occasions he has been known to throw a shield.