Deserve Classic Mastercard Review: Is It an Ideal Credit Card to Build Credit?

By J.R. Duren
HighYa Staff
Updated on: Sep 12, 2019

The Deserve Classic is a card for people with low credit scores that combines low fees with some basic perks that most people can take advantage of.

What's unique about the Deserve Classic is that it has a good blend of perks available to Deserve customers.

In our review of this card, we’ll give you our analysis of how the card works, what its rates and fees are, how it compares to other cards for bad credit and what its overall pros and cons for.

And, because cards like this are meant to be tools to raise your credit, we’ll interject our advice about how you can use this card to raise your credit scores.

How the Deserve Classic Mastercard Works

Quick Facts
Deserve Classic Mastercard
Pros: No annual fee, can only use for purchases

Cons: Possible default after first late payment, no rewards

Estimated Yearly Cash Rewards: None
Sign-Up Bonus Annual Fee Regular APR
None None 24.99%

To apply for this credit card, you’ll need to go to the card’s website and fill out a quick series of questions about the type of card you’re looking for.

If the Deserve Classic is the card the company suggests, then you’ll need to know exactly how the card works so you can use it to your advantage.

The Deserve card has no rewards, which means it won’t earn points or cash whenever you use it to buy things. Also, it has no sign-up bonus, which is a dollar or points amount you can earn by spending a certain amount of money in the first few months of owning the card.

What it does offer is a simple approach to spending. You use the card to make purchases, you pay your balance on your due date and if you don’t, you’ll have to pay a late fee and an interest rate on your balance.

We’ll talk about that in the rates and fees section but, for now, we want to point out some important information in the card’s fine print.

Ideally, you’ll use this card to build your credit by making your payments on-time and paying off your balance every month. The more consecutive on-time payments you can put together and the lower you can keep your balance, the higher your credit scores will go.

This is based on two principles: payment history and “utilization ratio”. A clear payment history (no bills more than 30 days late) and low utilization ratio (balances are less than 30% of your credit limit).

However, you can reverse all of the good you do to your credit score if you make one late payment with this card. According to the fine print, your account could go into default if you:

  • Make one late payment
  • Have one returned payment
  • Spend more than your credit limit
  • You go bankrupt

Those first three scenarios are more likely than the last one. If you’re someone who pays late, then this card could be extremely damaging for your credit report.

A credit card company reporting a default to the credit bureaus will cause your credit scores to drop considerably and it could take many months to repair that.

A default stays on your credit report for up to six or seven years, even if you pay off the balance. Therefore, we consider this card a high-risk card if you have a history of paying late.

It’s also a high-risk card if you tend to have a bank account near or at zero around the time your bill is due.

Aside from these warnings, your experience with this card will be straightforward. You can log into your account to check up on your balance, see your due date and set up automatic payments so you don’t pay late.

The Deserve Classic’s Perks

Deserve cardmembers get a series of perks depending on which card they have. At the time of publishing, Deserve offered a luxury card called the Deserve Platinum Pro and a student-focused card called the Deserve Edu.

The Deserve Classic does not have quite the number of perks the other two cards have.

However, one of the key benefits it does have is cell phone protection. If you pay your phone bill with the Deserve Classic, then you’ll get complimentary phone insurance from Mastercard.

If your phone is damaged or stolen, Mastercard will reimburse you up to $600 in one claim and $1,000 per year. The deductible you pay to get the reimbursement is $50.

The Deserve Classic Mastercard’s Rates and Fees

The Deserve Classic features a stripped-down set of rates and fees that we’ll list below, then discuss after:

  • Interest rate for purchases: 24.99%
  • Interest rate for cash advances and balance transfers: N/A
  • Penalty APR: None
  • Balance transfer fee: N/A
  • Cash advance fee: N/A
  • Foreign transaction fee: None
  • Late payment fee: Up to $25
  • Returned payment fee: Up to $37

We mentioned earlier that the Deserve Classic is a straightforward card. There aren’t that many frills and extra benefits. The same goes for the card’s rates and fees.

As this list shows, the card has one interest rate, which is also known as “APR,” or “annual percentage rate.”

This interest rate applies to purchases. There is no interest rate for balance transfers and cash advances because the card does not allow balance transfers or cash advances.

Both of those features are available on other credit cards for bad credit but not the Deserve Classic. This can be a good thing, as it will limit your options.

Being able to use your credit card to get cash from an ATM (cash advance) is a tempting and costly option. If you struggle with financial self-control, this card can provide some solid boundaries for you.

As for the purchase APR of 24.99%, it helps to know how much that interest rate can cost you per month and per year.

If you have a balance of $500 for one month, you’ll pay around $10 in interest. Over the course of one year that will cost you around $125.

Even though $10 a month doesn’t sound like much, it can add up over time. Furthermore, carrying a balance that is more than 30% of your credit limit will drop your score.

Our advice is to pay off your balance every month and, if possible, every week. Doing so ensures that your balance stays low and you don’t get caught spending more money than what you have.

Other perks include:

  • $10 credit for Lemonade insurance
  • $45 statement credit for Mint Mobile
  • $100 off a Feather furniture subscription

How the Deserve Classic Mastercard Compares to Other Credit Cards for Bad Credit

The following chart shows six other bad-credit cards, each of which has unique characteristics that make the different than the Deserve Classic:

Deserve Classic Mastercard Indigo Platinum Mastercard TOTAL Visa Credit Card Citi Secured Mastercard Discover it Secured Capital One Platinum Credit Card Wells Fargo Secured Credit Card
Intro offer None None None None $200 None None
Rewards rates None None None None 2x/2x/1x None None
Yearly rewards for $20K spending None None None None $200 None None
Minimum deposit required None None $89 $200 $200 None $300
Annual fee None Up to $99, depending on credit $75 first year, $123 after None None None $25
APR 24.99% 24.90% 34.99% 24.49% 25.24% 26.99% 20.99%
Penalty APR None 29.90% None 29.99% None None None
Late fees Up to $25 Up to $39 Up to $39 Up to $39 1st one free, up to $39 after Up to $39 Up to $37

What you’ll notice from this chart is that the Deserve Classic stands with the Capital One Platinum Credit Card as the simplest card. There is no annual fee, no rewards, no deposit and no penalty APR.

However, the card’s lack of flexibility means you won’t have the chance to transfer balances or, in emergency situations, withdraw cash via cash advances. While we don’t recommend cash advances, a balance transfer can be helpful.

Among the cards that don’t require a deposit, the Deserve Classic is the only one that doesn’t allow balance transfers or cash advances. The Indigo Platinum Mastercard does offer those options, but its yearly fees and penalty APR make it a worse choice than the card from Deserve.

The other four cards on the chart require either a security deposit or an up-front fee to open an account. Of those cards, the Citi Secured Mastercard has an APR on par with the Deserve Classic but its penalty APR makes it a less desirable choice.

The Wells Fargo Secured Credit Card has a better APR than the Deserve Classic but you’ll have to make at least a $300 deposit to open your account.

The TOTAL Visa Credit Card’s various fees and APR make it an expensive choice.

The remaining card, the Discover it Secured, is perhaps the best card in the chart because of its reasonable APR and the $200 a year you could earn in rewards.

Because of this, we think the card from Discover is ideal if you want to learn how to use a card responsibly while getting experience with rewards.

Once you build up your credit scores into the high 600’s, you have a good chance at getting a full-fledged credit card like the Discover it Cash Card, which can earn most people around $375 a year in rewards.

In our opinion, the Deserve Classic is a solid option for a card if you have bad credit. There is no annual fee and there isn’t a penalty APR, which is a 29.99% interest rate you get if you make a late payment on some cards.

The Bottom Line: Pros and Cons of the Deserve Classic

Based on our research, we think that the Deserve Classic has some clear strengths and weaknesses. On the plus side, the card is about as simple as they come. It has no balance transfers or cash advances, which means you transactions are limited to purchases.

This is a great way to start out if you’re a first-time credit card user. We think that the limit on the types of transactions you do will help you perfect spending with the card and paying it off.

The second strength the car has is its cell phone insurance. If you’re tight on money, having your phone damaged or stolen can put you in a tough financial spot.

Knowing that you have the protection that covers damage and theft for $50 provides peace of mind and a new phone at a fraction of the cost.

We believe these strengths make the Deserve Classic an excellent starter credit card if you don’t have a credit score or you have low scores.

We also think it’s a great card if you’re rebuilding your credit.

We say this with a caveat, though. The card’s fine print reveals its main weakness. If you make one late payment, Deserve could put your account into default.

If they do this, your credit will take a significant hit that will most likely erase any score increases you built up with the card.

So, while we recommend this card as a great first card or a card to rebuild your credit, we offer a stern warning, too.

Make sure you set up automatic payments that cover at least the minimum balance, which will either be 3% of your balance or $15, whichever is greater.

Finally, remember that using a credit card wisely (on-time payments, low balances) is just one part of building good credit.

To learn more about how to raise your credit scores, take a few minutes to read our guide to credit scores. We’ll help you understand how to decipher your credit scores, show you how they came into existence and provide examples of habits that can build good credit.

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