Effective Ways to Build a Good Credit Score From Scratch in South Africa

August 29, 2019

Establishing a good credit score is important for various reasons. Having a good credit standing and building your financial reputation on your credit report can lead you to many financial opportunities. You can easily get loans, no matter what type of loan you’re applying for. You can quickly get approved for any financial investments in the future.

What if you’re just getting started? Maintaining a good credit score or even rebuilding bad credit is one thing; starting from scratch is another. You obviously won’t be able to do so overnight, as you need ample time for this task. You need to have patience and discipline to build your credit score and make sure it won’t slip in the process. 

Here are a few ways you can build a good credit score from scratch:

Open a new credit card account.

The most practical way to build credit is to open a secured card. This is because secured cards are designed for those with no credit history yet. When you aren’t eligible for other cards, you can simply get a secured one. It will require you to deposit, which serves as collateral for the issuer. So in case you stop making payments, it’s less risky for them. Opening a credit card is one thing you can do because card issuers report card balances and payment history to credit bureaus. Therefore, it’s easy to build a good credit history with a credit card.

Ask to become an authorized user on another’s card.

Another way to build credit from scratch is to become an authorized user on someone else’s card. Chances are you won’t be approved for a regular credit card on your own, so you can become an authorized user on someone else’s card instead. You can ask your parents or spouse to be one of the authorized users on the card, so you can use it the same way the primary account holder can. In this case, the credit history of the account will show up on the authorized user’s credit report as well. Credit bureaus will list the payment history on your credit report as an authorized user on the card.

Obtain a credit builder loan.

Getting a credit builder loan is a great way to start building your credit. Once you successfully apply for a credit builder loan, the lender will deposit the amount you are approved for into a savings account for you. You just have to repay the loan and the interest over time. Once paid off, you don’t necessarily walk away, as with traditional loans. The lender will give you the money with any interest earned from the savings account. Furthermore, this process establishes payment history data for your credit report.

Have non-credit bill payments counted towards your credit history.

You’re probably making rent and utility payments, in which case you can have your non-credit bill payments reflected in your credit history. In most cases, landlords don’t report rent payments to a credit bureau. Check if your landlord does through an outside service. 

Maintaining a Good Credit Score

Ultimately, all it takes to raise your credit score is a good start and making positive changes to your credit report information. Once you get off to a good start, do what you can to maintain a good credit standing. You can do this by charging only what you can afford, paying more than the minimum, and paying your bills on time. Don’t apply for lots of credit cards and don’t close your accounts. Finally, make sure to monitor your credit report on a regular basis.


If you’re looking to apply for a personal loan in South Africa, get in touch with us today to see how we can help.