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Deserve, a credit card startup, has been raising money to help in its mission of helping college students establish a solid credit history. The company has fundraised $17 million from sources including Sallie Mae, Pelion, Aspect Ventures, Accel, and Mission Holdings, Business Insider reported.
Kalpesh Kapadia, who is the founder and CEO of Deserve, moved to the United States from India when he attended college here. He couldn’t get accepted when he applied for student loans and credit cards, which was frustrating for him. The refusals kept coming because he didn’t have a credit history built up in the country – but he couldn’t establish a credit history if no one was willing to issue him a credit card or student loan.
To help others avoid going through the same problem he did, Kapadia created Deserve. The company will issue a credit card to any person who has a bank account and a U.S. ID card, according to Business Insider. This opportunity can be particularly useful to those attempting to build their credit and for international students attending college in the U.S.
The funding Deserve raised has been used in part to help develop a stronger rewards program and for a mobile application which lets its customers build their credit, get rewards, and handle their finances.
While Kapadia does want to help others have access to credit, the company is also a solid business endeavor because of the sheer number of potential customers it reaches, according to PYMNTS. Generation Z, which is the college-aged segment of the population, makes up 25 percent of the country’s population. That’s a huge market Deserve can potentially reach.
What the Card Offers
The Deserve Edu card can not only help young students build a financial future, but it does offer some quality perks as well, which means students can reap some modest rewards while creating a credit history for themselves.
The card offers 1 percent cash back on all purchases. That’s a decent perk, especially since the card does not charge an annual fee. Some cash-back credit cards do require an annual fee.
Money-savvy students can use their credit cards to buy their textbooks for the upcoming school semester and they’ll earn 1 percent back on the purchase. While that won’t be a huge amount of cash back, every little bit can help a cash-strapped college student. And since it is something they’ll be purchasing anyway, they may as well get the money back for buying it on their card as long as they can afford to pay it off in full that month.
Plus, as an added perk, the cardholders receive an Amazon Prime Student membership, which is a value of $59. With this membership, cardholders will get free two-day shipping on eligible purchases they make on Amazon. This card also doesn’t require a deposit or cosigner.
Once you have the card in hand, it’s important to use the card responsibly so you can build credit. That means paying your bill on time every month, keeping your balance low or even paying it in full when you use it. With the strong credit you’ll build over the years, you may be eligible for lower interest rates on loans or other credit you might need.
Author: Shannon Serpette
Shannon Serpette is a mother of two and an award-winning journalist and freelancer who lives in Illinois. When she’s not spending time with her children, she is often pursuing her favorite hobbies – running, metal detecting, kayaking, and reading about personal finance.