Credit One Bank charges an annual fee on most of its credit cards
Credit One Bank does charge an annual fee on the majority of its credit card products. The fee amount varies by card: most cards carry a $39 annual fee, though some cards charge $75 or $99 per year. The bank does not waive the fee after the first year—you pay it every year you hold the card, whether you use it or not.
The annual fee is charged to your account automatically, usually in the month you open the card or on the anniversary of your account opening. It appears as a line item on your statement and counts as a charge against your available credit, just like any other purchase.
Credit One Bank primarily serves people rebuilding credit or with limited credit history. The cards come with features like credit limit increases and credit monitoring tools, which the bank positions as offsetting the annual cost. However, whether those features justify the fee depends on your situation and how you use the card.
Key Takeaways
- Most Credit One Bank cards charge $39, $75, or $99 per year, and the fee is not waived after the first year.
- The annual fee is charged automatically and reduces your available credit balance when it posts.
- Credit One Bank cards are designed for people with poor or limited credit history, not for those with established credit.
- Before opening a Credit One card, compare the annual fee against cards from other banks that serve similar credit profiles.
How the annual fee affects your credit and cash flow
When Credit One charges your annual fee, it reduces your available credit immediately. If your card has a $500 limit and you carry a $200 balance, your available credit is $300. Once the $39 fee posts, your available credit drops to $261. This matters because credit utilization—the percentage of your credit limit you are using—affects your credit score. A higher utilization rate can lower your score slightly.
The fee also costs you money directly. If you are paying interest on a balance, the annual fee is an additional charge on top of that interest. A $39 fee on a card with a 24% annual interest rate means you are paying roughly $3.25 per month just for the privilege of holding the card, before any interest on purchases.
Over time, the annual fee compounds. If you keep the card for five years at $39 per year, you will have paid $195 in fees alone, separate from interest and purchases. That is a significant cost for a credit-building card.
Credit One's features and whether they offset the annual fee
Credit One Bank includes several features with its cards that the bank argues justify the annual cost. Most cards come with free credit monitoring through a third party, allowing you to check your credit score and see factors affecting it. Some cards also offer the possibility of a credit limit increase after you make on-time payments for several months.
The credit monitoring feature has real value if you are actively rebuilding credit and want to track your progress. However, you can get free credit monitoring from other sources: Credit Karma, AnnualCreditReport.com, and many banks now offer free credit scores to customers. The credit limit increase is useful, but it is not may provide and depends on your payment history with Credit One.
The core question is whether these features are worth $39 to $99 per year to you personally. If you are rebuilding credit and plan to use the card actively to demonstrate responsible payment behavior, the monitoring tool may be worth the cost. If you are only opening the card to add an account to your credit mix, the annual fee is pure cost with no benefit.
Alternatives to Credit One Bank cards
Several banks and credit card issuers serve people with poor or limited credit history without charging an annual fee. Secured credit cards from banks like Capital One, Discover, and U.S. Bank require a cash deposit but do not charge annual fees. You deposit money into a savings account, and that deposit becomes your credit limit. You use the card like a regular credit card, and on-time payments build your credit history.
Unsecured cards for people with limited credit also exist without annual fees. Discover's student card and some regional bank cards do not charge annual fees and will consider applicants with thin or poor credit. The interest rates may be higher than Credit One's, but you avoid the annual fee entirely.
If you already have a credit card from another issuer, adding yourself as an authorized user on someone else's account with a long payment history can boost your credit score without opening a new card or paying any fee. This works only if the primary cardholder has good payment habits and a low balance.
When the annual fee is charged and how to track it
Credit One charges the annual fee on the anniversary of your account opening, not on a calendar date. If you open your account on March 15, you will be charged the annual fee on March 15 of the following year, and every March 15 thereafter. The fee appears as a separate line item on your statement in that month.
You should receive a notice before the fee is charged, though the timing and clarity of that notice varies. Check your statements regularly in the month your account anniversary approaches so you are not surprised by the charge. If you close your account before the anniversary date, you will not be charged that year's fee.
If you decide the card is not worth the annual fee, you can close the account before the anniversary. However, closing a credit card account can affect your credit score by reducing your total available credit and shortening your average account age. Weigh the $39 fee against the potential credit score impact before you decide to close.
Comparing Credit One's total cost to other cards
To decide whether a Credit One card makes sense for you, calculate the total cost of holding it for one year: the annual fee plus the interest you will pay on any balance you carry. If you plan to pay off your balance in full each month, you only pay the annual fee. If you carry a balance, add the interest cost.
Then compare that total to the cost of a secured card or a no-annual-fee card from another issuer. A secured card from Capital One charges no annual fee and has a similar interest rate to Credit One. A Discover secured card also charges no annual fee. The difference over one year could be $39 to $99 in your favor by choosing a different card.
The trade-off is that secured cards require a cash deposit, which ties up money in a savings account. If you do not have $200 to $500 available to deposit, a Credit One card might be your only option despite the annual fee. In that case, treat the fee as the cost of access and focus on making on-time payments to build your credit as quickly as possible.
Frequently Asked Questions
Can I get the annual fee waived or removed after I pay it?
Credit One does not waive annual fees, and the bank does not remove fees that have already posted to your account. Some cardholders have had success calling customer service to request a waiver before the fee is charged, but there is no may provide. If you call and ask, the worst outcome is that they say no.
What happens if I close my Credit One card right after opening it?
If you close the account before the first annual fee is charged (before your account anniversary), you will not owe the fee. However, closing a new account immediately after opening it can hurt your credit score by reducing your average account age and available credit. The damage is usually small and temporary, but it is worth considering.
Does Credit One charge any other fees besides the annual fee?
Credit One charges late fees, over-limit fees, and returned payment fees like most credit card issuers. The annual fee is separate from these. Late fees typically range from $25 to $35 depending on how late your payment is. Over-limit fees apply if you exceed your credit limit, though many cards now decline transactions that would push you over the limit.
Is a Credit One card worth it if I am rebuilding credit?
A Credit One card can help rebuild credit if you use it responsibly and make on-time payments. However, the annual fee makes it more expensive than secured cards from other banks that offer the same credit-building benefit without the fee. Compare your options before committing to the annual cost.
Will the annual fee show up on my credit report?
The annual fee itself does not appear on your credit report. Only payment history, account age, credit utilization, and inquiries show up on your report. However, if the annual fee causes you to miss a payment or go over your limit, those negative marks will appear on your report.