Can reviewing papers help increase your credibility as a researcher?
Yes, it helps in more than one way.  Community service is a relevant part on an academic CV.  Although reviewers for individual papers are normally secret, it does not need to be secret that you have reviewed articles for journal X.  You can write that you have done so on your CV, and if needed (but I don't think it should be), a journal editor can confirm.

It works the other way around too: being asked to review a paper is an independent confirmation of your credibility as a researcher.  The first times it happened to me, it was really an ego boost.  Wow, someone else than my supervisor thinks I know something about something!  Great!