Is Orchard Bank a Scam?

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Q:I’m a little skeptical about Orchard Bank. Is it a scam?

A: No. Orchard Bank offers credit cards for rebuilding credit. The Orchard Bank Classic MasterCard is one card they offer. It is a secured card, meaning you pay them your entire credit limit in advance and they hold on to it as collateral in case you do not pay your bill. You still make monthly payments like with a normal credit card.

Orchard Bank is operated by HSBC, which has an A+ rating with the Better Business Bureau. There are some complaints online related to raising interest rates and a few other things (such as refusing to raise credit limits), but many credit card companies have been doing that lately.

Because their cards are for those who have low credit scores and want to repair their credit, the APR on these cards will be fairly high. This is not a credit card that you will want to carry a balance on. Your credit limit will be fairly low, also. Secured cards are only meant for temporary use to rebuild credit. Once your credit score starts to go up, you can apply for a card with a lower interest rate and a higher limit, if you need it.

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Credit Shout is a community of personal finance experts dedicated to helping you save money and make smart financial decisions. Learn how to master your credit card rewards, improve your credit score and start eliminating your debt.

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