(Amazon Photo)

Amazon rolled out a new credit card on Monday, targeting people looking to build or rebuild their credit.

The new “Amazon Credit Builder” gives customers that have no credit or bad credit a way to use Amazon’s rewards credit card.

Amazon already offers the Amazon Store Card and Amazon Prime Store Card for Prime members. The new card is similar — no annual fee; 5 percent back on eligible Amazon purchases for Prime members— but is described as a “secured credit card,” because it requires a refundable security deposit that becomes a customer’s credit limit.

The deposit you make to fund a ‘secured credit card’ is considered collateral because it acts like a guarantee for the creditor,” Amazon says. “Secured credit is an ideal way to build or rebuild your credit score. A secured credit card gives you the opportunity to build a record of on-time payments that can help to boost your credit score.”

The card can only be used for Amazon purchases or with merchants that offer Amazon Pay. Users can upgrade to a regular Amazon Store Card in as little as seven months after opening an Amazon Credit Builder account.

Ted Rossman, an industry analyst for CreditCards.com, said it’s a solid option for people new to credit or who are rebuilding credit, but cautioned that the 28.24 percent interest rate is high.

“This is a very unique card, between the secured nature, the 5% cash back offer and the two different flavors of 0% interest (either 12 months of equal payments or 6/12/24-month 0% periods for select purchases),” he said in a statement. “If used properly, this card can help you improve your credit while saving on interest or pocketing an attractive cash back return on items you would (hopefully) buy anyway.”

Amazon is partnering with publicly-traded financial services company Synchrony Bank for the new credit card.

Amazon has rolled out other services to lower-income customers, such as discounts for people on government benefits. It also offers Amazon Cash, which lets people use cash to add money to their Amazon account and appeals to those that don’t make purchases online with a credit card or bank account.

In 2017, Amazon launched a Prime Rewards Visa credit card.

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