MoneyLion Review – A Credit Builder (and Much More!)
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MoneyLion Credit Builder Plus gives you up to $1,000 in loans so you can build credit. But at $19.99 per month, the price of admission is a little steep.
8.5/10
Features
9/10
Cost
8/10
Ease of use
9/10
Service
8.5/10
Working to build credit early on in your adult life is one of the best financial decisions you can make. Something as simple as opening an account may prove to be troublesome because many lenders will ask for your credit history. A good credit score opens all the right doors. For one, banks are more comfortable lending you money because they consider you someone with a low level of default risk. Bad credit has the opposite effect; you don't qualify for loans, and even when you do, you'll be charged a higher interest rate.
For credit newbies, there are many ways they can go about building credit. Using secured credit cards, becoming an authorized user, and keeping an eye on their credit utilization are among the levers they can pull to establish credit. A lesser-known option is a credit builder loan, which as the name implies, is a loan meant for people without a credit history.
MoneyLion is one company offering such a credit builder loan.
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What is MoneyLion?
MoneyLion is a mobile banking and financial membership platform launched in 2013. It aims to empower people so they can take control of their finances. It has built a full-service digital platform that includes mobile banking, lending, and investment solutions. MoneyLion's app is a one-stop shop for your personal finance needs. You can use it to open a checking account, get cash advances, build credit, and achieve savings.
MoneyLion went public in September 2021, roughly a year after it raised $100 million in a Series C round. TechCrunch reported that the company's valuation was close to $1 billion. MoneyLion had about 15.5 million total customers as of March 2024.
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MoneyLion Credit Features
RoarMoney
RoarMoney is a zero-fee checking account that you can use in various manners. The first feature is Safety Net, which gives up to $1,000 in cash advances at 0% APR if you add recurring deposits to your RoarMoney account. You can also connect direct deposits to RoarMoney and get paid up to two days early. In addition, Round-Ups lets you invest spare change into your investment account. You can earn cash back on your purchase using your RoarMoney debit card at select merchants. You can also use your RoarMoney account to track your spending habits and plan a budget.
Instacash Advance
In a financial pinch? You can get cash advances of up to $500 through the MoneyLion app at 0% APR. There's no credit check; the loan funds are deposited in a few minutes. You may be eligible for the $250 Instacash Advance and the $1,000 when you open a RoarMoney account. As for repayments, the money will be deducted from your account on the due date, as determined by your pay or other recurring deposit cycles, usually in about two weeks.
MoneyLion Crypto
The crypto market may be in freefall some days, but investment gurus generally recommend buying the dip. Thanks to a feature called Crypto Round-Ups, this product lets you invest your spare change in Bitcoin, Litecoin, or Ethereum. Crypto Round Ups also lets you invest this spare change in an investment account using your current credit or debit card. You can also trade cryptocurrencies through the MoneyLion app with a RoarMoney account. The product is unavailable in Hawaii.
Auto Invest Account
As the name suggests, this product offers fully automated investing and rebalancing. It is geared toward long-term investors, and you can adjust portfolio allocation every five days. You can add or withdraw funds anytime you want and invest in a mix of stock and bond ETFs. You can also make changes to your portfolio depending on your risk tolerance, budget, and investment goal.
Debit card rewards
If you use your MoneyLion Debit Mastercard and RoarMoney virtual card to purchase $10 or more, you may be eligible for cash rewards of up to $500. Shake N' Bank, as the feature is known, lets you earn up to five times the value of your purchase, up to $500. The company's mobile banking app has cash-back offers from top online merchants.
Credit Builder Plus
For customers needing to build credit, whether a credit newbie or someone trying to repair bad credit, MoneyLion offers a loan program, which we discuss below.
What is a credit builder loan?
If you take out a personal loan, you get the money upfront, which you pay back over time. However, with a credit builder loan, you pay the lender a fixed amount and get access to the loan amount at the end of its term. These loans do not require good credit, but the lender will ensure your income allows you to set aside the installment.
Credit builder loans aren't marketed heavily like personal loans, so you'd be forgiven for not having heard of them before. And they're offered by niche, smaller financial services companies. However, community banks, credit unions, and financial technology companies also offer this loan. And you don't need a good credit score to be eligible to get such a type of loan.
These loans are designed to put you in good standing with major credit bureaus. How does that happen? By ensuring you make each payment on time, every time! A credit builder loan is no good if you miss a loan payment or make late payments. If that does happen, the lender will report it to the credit bureaus, which will hurt your credit score.
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How does MoneyLion Credit Builder Plus work?
You don't need a MoneyLion account to qualify for a Credit Builder Plus loan. You're eligible for a loan if:
- You're 18 years old
- Are a permanent resident of the U.S.
- Have a Social Security number
- Have spending or checking out.
That said, having an account with MoneyLion does have its perks, and the process is fairly simple. You'll be asked to input your name, email, home address, Social Security number, and a verifiable phone number. You'll also be required to have a verifiable bank account showing a steady income stream.
However, if you'd like to avail of a Credit Builder Plus loan, you'll have to sign up for a Credit Builder Plus membership, which unlocks other benefits as well. You can apply for a Credit Builder Plus loan of up to $1,000.
MoneyLion says that more than half of its members raised their scores by more than 27 points within 60 days.
MoneyLion Credit Builder Plus features
No credit check
This is arguably the best feature of this product. You don't need a stellar credit score for a Credit Builder Plus membership. To become eligible for the loan, MoneyLion will review your primary checking account to ensure you can make timely payments. But your credit report will not be pulled.
Instant delivery
Once MoneyLion approves your credit builder loan, the money will appear in a third-party checking account within three business days. You can speed up this process by opening a MoneyLion checking account and depositing the money there.
Extra perks
Came into possession of some extra cash? You can use it to prepay your Credit Builder Plus loan at no additional cost. If you'd like to postpone a scheduled payment, you can apply to MoneyLion. In addition, you will also be eligible for free credit monitoring powered by TransUnion.
Savings
Once approved for a loan, the company may split your loan disbursement into two parts: Money you’ll receive up-front and funds put into a credit reserve account in your name. Based on the criteria you outlined during account opening, this money will be invested on your behalf. Once you've repaid the loan, cash in the credit reserve account will be released.
Easy repayment
You can repay the small loan over 12 months. The easiest way to do it is to set up automatic loan repayments based on when you get paid. This ensures you're never late because on-time payments help build your credit history.
How much does MoneyLion Credit Builder Plus cost
You'll have to pay a monthly membership fee of $19.99 if you'd like a Credit Builder Plus loan. But there's a way for it to pay for itself. Enter Lion's Share Loyalty Program, which rewards you with cash back for making an eligible purchase and logging into the MoneyLion app.
The program has four levels: bronze, silver, gold, and platinum. You must meet both requirements to qualify for a tier.
As you can see, the bronze tier offers a payout of up to $2.00, silver will pay up to $5.00, gold will pay up to $10.00, and platinum will pay $19.99. So, if you'd like your monthly membership fee to pay for itself, you'll have to target the platinum tier. But there are a few caveats.
The first, as noted, is that you must meet both requirements. For example, if your purchases satisfy the platinum tier's requirement, but the number of days you logged in falls within the bronze range, you would qualify for bronze rewards. Secondly, to be eligible for Lion’s Share rewards, you'll have to make purchases of at least $10.00 via your MoneyLion Debit Mastercard or RoarMoney virtual card.
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Who should or shouldn't use MoneyLion Credit Builder Plus
If you're looking to build credit or improve your existing credit score, MoneyLion Credit Builder Plus is worth a look. But I wouldn't count on it to help me on a rainy day. You only receive a portion of the overall funds, and what you do receive isn't a significant sum. Still, it's a great first step towards establishing credit, which is the intended use of Credit Builder Plus.
Before signing up, consider the $19.99 membership fee. To sidestep the monthly fee, capitalize on Lion's Share Loyalty Program.
Pros and cons
Pros
- Instant delivery if you choose to have the money deposited in your MoneyLion account.
- No credit check required.
- Can prepay the loan if you'd like.
Cons
- In order to get the credit builder loan, you have to pay a $19.99 monthly membership fee.
- Loan amount is capped at $1,000.
- If you don't have a MoneyLion account, you'll have to wait up to three days to get the loan.
MoneyLion Credit Builder Plus vs. its competition
Service | Cost | Maximum loan |
MoneyLion Credit Builder Plus | $19.99 per month | $1,000 |
Brigit Credit Builder | $8.99 per month | $600 |
Kikoff | $0 | $750 |
Brigit
Brigit is a personal finance app offering numerous features like up to $250 in cash advance, identity theft protection, and budget management tools. It also offers a credit builder loan without a credit check. But to get the loan, you'll have to pay $8.99 per month for a year to become a member of Brigit Plus. As for repayments, you can contribute $1 and $50 for a 12-month loan or $1 and $25 for a 24-month loan. Every successful payment you make is reported to the Big Three credit bureaus, which improves your financial standing.
Kikoff
Kikoff will give you $750 without doing a hard pull of your credit report so you can work to improve your credit. It has a flat fee of $5 per month, and you can get approved incredibly quickly for a loan. Kikoff's credit builder loan targets the top two items affecting anyone's credit score: it aims to build a long-term payment history and low credit utilization. Kikoff is unavailable in Delaware.
FAQs
What's the APR on a MoneyLion Credit Builder Plus loan?
According to MoneyLion, you can expect APR of between 5.99% to 29.99%.
Do I have to have good credit to a get credit builder loan?
These loans are designed for individuals looking to build credit. When you apply for this loan, MoneyLion will only conduct a soft pull of your credit report which doesn't impact your credit score.
Is Credit Builder Plus available in all U.S. states?
No, the product is not available in Indiana, Iowa, Montana, Nebraska, Nevada and Vermont.
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Is MoneyLion Credit Builder Plus legit?
MoneyLion Credit Builder Plus gives you up to $1,000 in loans to help you build credit and establish a solid financial foundation. But the product isn't available in all states, and you can expect an APR of between 5.99% and 29.99%. You should always aim to make payments on time, but if you can't and are in good standing with MoneyLion, it may agree to defer a payment. But at $19.99 per month, the price of admission is a tad steep. However, the membership should pay for itself if you can use the Lion's Share Loyalty Program.
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Writer
Jasir Jawaid is Joy Wallet's Assistant Editor. He has more than 13 years of experience as a journalist covering Wall Street, equities, financial policy and regulation, and cryptocurrency and blockchain.
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