Indigo Credit Card: Credit-building Tool or Trap?

Applying for a credit card can be daunting, especially if your credit score is not in the most appealing situation. This is why it is suggested to use store cards or secure credit cards that have specific characteristics to aid you in rebuilding your credit. The Indigo credit card is advertised for the same purpose, but finance experts take it with a pinch of salt. Here’s why:

Indigo Credit Card

Indigo Credit Card 2022 Review

Intro Bonus: None

Regular APR: 24.90%

Credit Score: 300 to 670 (Bad to Fair)

Annual Fee: $0 to $99


  • The card offers prequalification that uses a soft credit pull to prevent adverse impacts on your credit.
  • The issuer reports to all three credit bureaus: Equifax, Experian, and TransUnion.
  • There are three tiers for the cards based on one’s creditworthiness, and they will determine the price of the annual fee you are going to pay.
  • The card has no rewards programs.
  • It only offers a max credit limit of $300.

Indigo Credit Card Full Review:

Indigo credit card comes with very enticing colors, making them visually appealing. There are even free extra card designs for you to choose from. However, behind its physical glamour is an awkward combination of features that will make anyone question it as a tool for credit building.

Indigo Credit Card designs

Indigo credit card is available in different designs, which make it attractive. How about its features?

As mentioned before, the card is meant for individuals struggling to build their credits. Most of these people are probably the ones who are already experiencing financial challenges. Yet, the Indigo credit card’s annual fee isn’t entirely $0 at all. The card has three tiers with different yearly fee charges: $0, $59, or $75, with the last one increasing to $99 after the first year. The tier that will be approved depends on the creditworthiness of the applicant. That means regardless of your current credit score situation, you might still end up paying a $99 annual fee.

Indigo credit card pre-qualification

Indigo credit card allows pre-qualifying of application, but the card’s annual fee isn’t entirely $0 at all.

The tier will also determine the credit limit of the card users, and this is where things get challenging: it has a $300 max limit. The problem? You shouldn’t max out your credit according to the rule of credit utilization ratio (one of the elements in calculating your credit score). Here, you basically shouldn’t use more than 30% of the credit to keep your credit score in a healthy state. In this case, you are stuck at $90. Worse, the credit you can use can even go lower if you are approved to a tier that requires an annual fee. This makes things more complicated for those who are already facing problems financially. With very little remaining credit available, it is like teasing the user to go beyond the safe 30% utilization ratio. That makes the Indigo credit card more of a dangerous trap than an ideal financial tool for people.

Improper use of the card can also lead to further problems due to its high APR. The standard variable APR comes at 24.90%, while the penalty APR can reach 29.9%. Don’t also forget that the late payment fee can cost up to $40, so you might want to make sure you’re always on top of your financial responsibilities on this card. 

On the other hand, there are no rewards or points to expect from the card. However, it comes with additional benefits such as a 1% foreign transaction fee, pre-qualifying process without impacting your credit score, $0 liability on unauthorized charges, and 24/7 account access via phone or computer. Other than the things mentioned, the Indigo credit card is considered a straightforward card fashioned to “help” you improve your credit situation.

So, is it for you? It can be acquired by anyone having hard times qualifying for other standard credit cards, but it is a sinister path to choose. One can always say that it can rebuild the user’s credit when appropriately used. Still, it is almost impossible with such a card that charges a rather ridiculous annual fee with a minimal line of credit to offer. Instead of providing power to users with credit problems, Indigo provides very little room to move. Our finance experts believe that no one deserves this kind of offer, even those who already have unpleasing credit scores. If you need other options, there are free credit cards that you can get without paying annual fees, though they require high credit score requirements. If you need the best choice possible, consider Discover It Secured credit card that accepts even poor credit scores. As a plus, it charges no annual fees and offers users the chance to enjoy its Cashback Match and other rewards programs.