AvantCard Review

Full Review of AvantCard

Pros Explained

• No Security Deposit Required: A secured card, the customary solution when you’re rebuilding your credit or establishing your credit from scratch, requires its cardholder to put up an amount equal to their desired credit line, at least initially. The AvantCard, by contrast, grants you a limit without such a security deposit. As with most other credit cards, the company reviews your application and awards a credit limit of between $300 and $1,000. 
• No Foreign Transaction Fees: Many credit cards require you to pay a percentage charge whenever you use your card outside the United States or when buying from merchants abroad in their local currency. The fee can be 3% (or higher) of every transaction. The AvantCard has no such charges, which is highly unusual for a credit-building card, and so can be a smart choice when traveling internationally or doing business with foreign vendors. 
• Pre-qualification Available: When you’re considering a new credit card, you have to submit a full application and undergo a hard credit inquiry before you find out if you’re eligible to receive it. If your application is denied, you’ve then suffered a further dent, albeit a small one, to your credit score and received no card in return. According to myFICO, a single hard credit inquiry may reduce your credit score by five points. The AvantCard allows you to apply without an initial hard credit inquiry, and get at least an indication as to the terms under which you might get the card, including your likely credit limit and annual fee. However, assuming that information is favorable and you decide to accept those terms, you still must undergo a hard inquiry in order to be formally approved for the card. 

Cons Explained

• Relatively Low Credit Limits: The AvantCard’s maximum initial credit line of $1,000 is below the relative norm of at least $2,500 offered by many secured cards—provided, of course, you are willing with the latter to secure that higher limit with a deposit of an equal amount. Avant says it will review your credit line from time to time, and may raise it, and that you can also request an increase, which may or may not be granted. Still, if you have more than $1,000 for a security deposit, a secured card will provide the ability to charge more to a card, at least initially, than will the AvantCard.
• Annual Fee Is Likely: In theory, you might get the AvantCard without paying an annual fee. However, the company says the charge can range as high as $59 for applicants whose credit and financial particulars are less desirable. 
• No Card Benefits: The AvantCard doesn’t offer any benefits for cardmembers, such as travel extras. While that isn’t atypical for a card designed for people with poor credit, there are cards available that offer more robust benefits. For example, the Deserve PRO Mastercard has no annual fee, but it offers benefits like secondary auto rental insurance and cell-phone protection. 
• No Rewards or One-Time Offer: The AvantCard has no rewards, so you can’t earn points, miles or cash back on your purchases. Neither does it offer a one-time offer as an inducement to get the card. That’s a significant drawback compared to some of this card’s alternatives. For example, the Discover it Secured card, which does require a security deposit, allows you to earn 2% cash back on up to $1,000 of spending each quarter on gas and restaurants. And you’ll earn unlimited 1% cash back on all other purchases. If you spent $5,000 per year with the Discover it Secured card—$1,000 in combined spend per quarter at gas stations and restaurants to earn 2% cash back, and $250 at 1% each quarter on all other purchases—you’d earn $90 in rewards. Plus, after your first year, Discover will match all of the cash back you earn, giving you $180 in cash back. That reward is a nice bonus for a beginner credit card. 
• Issues with Customer Service: Avant’s customer service is not up to the norm for the credit-card industry in several respects. Its staff are only available during select hours. That’s in contrast to most major card issuers, which offer customer support around the clock. Also, there’s reason for concern about Avant’s customer satisfaction. The company is not included in J.D. Power's credit card related studies. However, it was scored in J.D. Power's 2020 Consumer Lending Satisfaction Study. In this study, Avant ranked 13th out of 14 lenders and scored significantly below average.

The AvantCard offers an alternative to a secured card for the estimated 26 million Americans—11% of adults—who have no credit history, according to the Consumer Financial Protection Bureau. Millions more have poor credit, making it difficult for them to qualify for a loan or credit card.

Since it doesn’t require a security deposit, instead giving you access to a revolving line of credit, the AvantCard better suits those who may have limited funds than does a secured card. Yet as with the issuers of secured cards and most cards in general, Avant will share your account and payment information with the three major credit bureaus—Experian, Equifax, and TransUnion. Provided you make all of your payments on time, your positive payment history will help build or repair your credit score.

It’s also a smart option if you lack a credit card and plan to travel abroad. It doesn’t charge foreign transaction fees, so you can use it outside of the United States without incurring extra fees. 

Standard Benefits

The AvantCard doesn’t offer any benefits other than a mobile app you can use to manage your account and make payments 24/7. 

Cardholder Experience

Customer support and service is especially important if you’re new to credit cards. As a new, small, and niche company Avant was not included in the 11 national card issuers nor in the 11 regional issuers ranked in the most recent J.D. Power Credit Card Satisfaction Study. However, the company is ranked in the J.D. Power 2020 U.S. Consumer Lending Satisfaction Study. In this study, Avant was ranked 13th out of 14 lenders and scored significantly below average.

Avant offers phone support through phoning 1-855-752-7012. You can also email CreditCards@Avant.com, and they pledge to respond within three business hours, a promise they kept with Investopedia's inquiry to them. 

However, where most issuers have 24/7 customer service, Avant’s is only available during select hours: 

• Monday through Friday: 7:00 a.m. to 10:00 p.m. Central
• Saturday–Sunday: 7:00 a.m. to 8:00 p.m. Central 

If you’re dealing with a problem outside of Avant’s service hours, then, such as a lost or stolen credit card, this limited availability might be a major problem. 

Security Features

The AvantCard offers zero liability for unauthorized charges, a standard feature of all credit cards. 

Fees to Watch Out For

If you’re thinking of applying for the AvantCard, there are two fees (in addition to a likely annual charge) that you should be aware of first. Neither is unusual for the industry, but a first-time card owner might be unaware of them:

• Late-payment fee: If you miss one of your monthly payments, Avant will charge you a late fee of up to $39. 
• Cash-advance fee: While this card offers the same APR for cash advances as it does on purchases, make sure you pay attention to cash advance fees. You’ll pay $10 or 3% of the amount of each cash advance, whichever is greater. If you took out a cash advance of $250, that means you’d pay $10 in cash advance fees. 

Our Verdict

If you have no credit, or a problematic credit record, and want to build a strong credit history, the AvantCard is an alternative to a secured credit card. You can get access to a revolving line of credit without having to put down a security deposit. 

However, the card offers no rewards or benefits, has a limited credit line (at least initially), and Avant’s customer service could be a significant drawback. If you’re looking for a card with more features and accessibility, you may be better off with a secured card. 

For example, the Discover it Secured, from a company highly rated by J.D. Power, provides rewards, a low-interest APR offer, and a first-year match of the cash back you earn. And if you use the card responsibly, you can get your security deposit back and be automatically approved for an unsecured card in less than a year.