Credit Karma vs Credit Sesame: Which Free Credit Monitoring Tool Is Better?

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Personal emergency, desire to buy that new car, buying the house of your dreams, sending your kids to that top college for higher education (or sending yourself)… the list of reasons why someone might need a loan or credit at some point in their lives is long. Now comes the part where your credibility is checked by the banks, and therefore, your credit score. A good credit score is important for everything these days, whether you need a home loan, auto loan, business loan, or even a simple credit card.


How do you maintain a high credit score so that in times of need you don’t fall short on this aspect? It can be tedious and perplexing to keep a tab on your credit scores and consequently, your credit report, and for a lot of people unaware of the process, it can be quite expensive as well owing to a plethora of scammers awaiting easy targets. Enter free credit monitoring tools!

Credit Karma and Credit Sesame are among the most popular and used online credit monitoring tools that provide you with plenty of services and information to ensure you are always knowledgeable about the status of your credit standing, all free of cost. However, which of the two is better? Let’s compare their offerings, pros and cons, to find out.

Basic Overview

Before delving into their differences and judging which tool is more user friendly, let’s first quickly acquaint ourselves with what these tools actually are.

Credit Karma

Found in 2007, Credit Karma is a free online website and mobile app service that provides individuals free credit scores and access to credit reports by TransUnion and Equifax. Credit Karma analyzes your credit score and report and provides information on steps you can take to increase your score and why it is low or high in the first place.

It also provides personalized recommendations for credit cards and loans, pertaining to your credit score, along with allowing individuals to file their taxes through their application as well. Credit Karma also provides its users access to an excellent resource center, sharing quality content on financial literacy.

Credit Karma provides all these services absolutely free of charge for all registered users, and unlike other websites that claim to provide free scores but require your credit card details to sign up, Credit Karma only needs your personal details like phone number, email address, Social Security number and your annual income.

Credit Sesame

Relatively newly found (in comparison with Credit Karma) in 2010, Credit Sesame is also a credit reporting and monitoring tool. It offers its users multiple financial services, all free of charge. It allows individuals to monitor their credit reports from all three credit bureaus — TransUnion, Equifax and Experian, updated monthly.

Apart from granting access to monthly credit scores and reports, Credit Sesame also offers its users recommendations for financial products like loans and credit cards, tailored according to their financial profile. It also goes a step further and provides up to $50,000 in identity theft insurance to its customers.

A point that users should note at this junction is that neither Credit Sesame nor Credit Karma provide actual credit reports. They only offer the credit report summaries as per the information taken from each credit bureau.

Credit Karma vs Credit Sesame: Services Offered

Credit Sesame and Credit Karma, both offer similar basic services free of cost to their registered users. However, there are certain unique services offered by them individually. Let’s take a look at the services offered by these credit monitoring tools.

Credit Karma

Credit Score Reporting

Credit Karma allows its users access to their credit scores — free of cost — from TransUnion and Equifax, 2 of the 3 biggest credit scoring bureaus. These scores are updated every time the user logs into his account on Credit Karma, which uses the Vantage 3.0 model and not the more commercially used FICO model for calculation of these scores.

There is also an option to compare the individual score with the national average score to find out the gap. The users can also receive their TransUnion auto insurance score and home insurance score individually in case they want to pitch to the insurance company.

Credit Monitoring

Credit monitoring means keeping a check on the changes in your credit score, analyzing why it is increasing or decreasing, and receiving alerts in case of any unusual activity in your account affecting your credit score.

Credit Karma does a great job in monitoring your credit reports and allows access to several online calculators to analyze the effect of various actions on your credit score, like the free credit simulator and debt repayment calculator. It also alerts you in case of any fraudulent activity providing identity theft monitoring.

Targeted Loan and Credit Card Recommendations

Credit Karma shows you tailored recommendations for credit cards and loans from different companies and banks, best suited for your financial profile and according to your credit score. Every time a user purchases a credit card or applies for a loan through these recommendations, Credit Karma makes a commission.

However, these are optional services and users can continue to avail other services free of charge even without purchasing these products.

Filing Tax Returns

Unlike other tax filers online, Credit Karma’s tax filing service — federal and state e-filing — is absolutely free of cost. Users can file single or joint returns, and other forms like Schedule C, D or E forms in case of income from self-employment or investments. None of the variants cost anything.

However, Credit Karma does not file tax forms that are unsupported such as returns of part-year residents or the state tax returns of Mexico. Also, if you’re a business owner, there is no option to file small business, corporation, partnership or multi-member LLC forms.

Credit Sesame

Credit Score Analysis

Credit Sesame, like Credit Karma, offers free credit scores. The credit score offered by Credit Sesame, though, is only from TransUnion, and a Vantage 3.0 score designed by the three credit bureaus. The score is updated monthly.

Credit Sesame also offers a premium subscription plan that gives access to credit scores and reports by all three credit bureaus along with daily updates.

Credit Report Monitoring

Credit Sesame offers free credit monitoring, alerting users in case of changes in scores, as well as the opening of a new credit account owing your loan application or a new credit card, therefore, also protecting against identity theft. It also provides insights and analysis of the important changes, along with sharing information on various steps you can take to improve the credit score.

Identity Theft Protection

While alerting you in case of changes in credit reports and credit scores, Credit Sesame also protects you against any fraud by providing up to $50,000 as identity theft insurance. This insurance is completely free of cost, provided to users on signing up the portal.

For paid membership, users can increase the insurance amount to $100,000 as well.

Personalized Recommendations

Credit Sesame shows targeted ads to its users, showcasing financial products like loans and credit cards. It also helps you find and compare the interest rates across various loans, enabling you to take the best decision, and in return, they receive an affiliate fee from the particular bank in case you do end up taking the loan.

In case of credit cards, it brings to you the best offers on balance transfer, rewards points, cashbacks, etc, and if you do apply for the credit card through their suggestion, they again receive a commission from the vendor.

Credit Karma vs Credit Sesame: Pros and Cons

Each of the two tools, Credit Karma and Credit Sesame, offer a host of services to the users for free. Yet, there are certain key benefits that they have over each other, along with certain disadvantages.

Ahead, let’s take a look the advantages and disadvantages of both the credit monitoring tools individually.

Credit Karma


If you sign up with Credit Karma, what benefits will be you be able to avail?

  • Free credit scores from two of the big bureaus, TransUnion and Equifax, that are updated on a continuous basis. You can easily see the impact of your financial actions on your credit score through the updates.
  • Free credit reports from TransUnion and Equifax, updated weekly, allows the user to monitor any discrepancy in their credit scores.
  • Access to a free credit simulator that allows users to see the impact of their moves on their scores in real time. For example, it shows how your score will be impacted if you pay off some of your existing loan or take another credit card.
  • Easy and free filing of income tax through the website itself; an advantage over the paid portals.
  • Provides alerts in case of any suspicious or unusual activity in your account, protecting you against identity theft.
  • It has a member forum where it features reviews of the products it advertises or recommends to its users.
  • Free access to multiple online calculators like debt repayment, amortization, simple loan calculator and more.
  • Option to receive your TransUnion home insurance and auto insurance score in order to make your case for a higher insurance.
  • Excellent resource center with good content on financial advice.


Despite the long list of pros, are there any negatives that put Credit Karma on the lesser side?

  • It uses Vantage 3.0 and not the more common FICO score used by lenders. This might not present the exact picture.
  • The reports provided are not actual reports, but an analysis of the information gathered by the credit bureaus.
  • Credit Karma is not accredited by BBB officially.

Credit Sesame


Credit Sesame has some clear advantages over its competitor, Credit Karma, when it comes to offering premium services.

  • Free identity theft protection up to $50,000; this is the biggest advantage Credit Sesame holds over its alternatives. The insurance amount can be increased to $100,000 in case of paid subscriptions.
  • It shows your entire debt — loans, mortgage, credit cards — right on your dashboard.
  • Provides Vantage 3.0 credit score from TransUnion.
  • The premium subscription allows you to receive and track the credit score and report from all three bureaus: Equifax, TransUnion and Experian.
  • Offers real-time alerts and updates so you’ll know right away when an important change has been made to your credit report.
  • Allows its users to set flexible goals and targets to work towards improving your credit score; it also provides information and suggestions on how to reach these goals.
  • Officially accredited by BBB with an A+ rating.
  • Provides alerts through text as well as email, in case of changes in the credit score.
  • It has several premium credit plans that offer a host of advanced services for individuals looking for more offers.


With such distinct pros, are there any aspects like make Credit Sesame less considered?

  • The free account provides credit score from only TransUnion, while Credit Karma’s free account provides credit report from TransUnion as well as Equifax.
  • You can’t access the actual credit report via Credit Sesame, but only the score calculated by it using the information by TransUnion.
  • Several complaints have been made by the customers on the user-friendliness of the interface.

The Verdict

Credit Sesame and Credit Karma, both are highly useful online credit monitoring tools that are available completely free of cost to its users. They both offer free credit score and credit monitoring services in an effort to bring awareness to individuals about their credit standing and enables them to fix any bad scores before applying for loans and other means of credit.

Some aspects of Credit Sesame rank it above Credit Karma, like the free identity theft insurance and showing total debt in one place on the dashboard. However, there are a couple of factors that also reveal its downside. For instance, it only shows score from one credit bureau, and for scores from all three, users will need to take a premium subscription.

Credit Karma does an excellent job on the financial literacy front by allowing its users access to numerous calculators and tools like credit simulator and repayment calculators, all free of cost. Its free tax filing service and free scores from two of the top three credit bureaus also makes it distinct.

In conclusion, Credit Karma stands higher on the user-friendliness front, with more free services and advanced monitoring tools. Nevertheless, for a comprehensive view of your credit score and availing the best benefits, it’s reasonable to sign up for both the portals, and hey, it literally won’t cost you anything!


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