All information about Citi Simplicity® Card, Capital One® Secured Mastercard®, Citi® Secured Mastercard® , Green Dot primor Mastercard Gold Secured Credit Card, Green Dot primor Visa Classic Secured Credit Card, and Green Dot primor Visa Gold Secured Credit Card has been collected independently by CreditCards.com and has not been reviewed by the issuer.
Comparing Secured Credit Card Offers
If your credit isn’t its best or you are new to credit, your options can be limited. In fact, the New York Federal Reserve reports that in February 2020, 14.2% of consumers were rejected when applying for credit cards. But with a secured card, you can build your credit in a few months so that you can apply for a more rewarding unsecured card.
Secured cards require a refundable deposit that you are borrowing off of for your available credit limit. In many cases, they may be your only option. But they are a great way to build credit and to develop good payment habits.
We evaluated more than 200 secured credit cards using such criteria as: rates and fees, deposit amounts, ability to improve credit, customer service, and miscellaneous features and benefits. Below are our top picks for the best secured cards and further information to help you make your decision and improve your credit so you can qualify for even better offers. Here, we look at:
Wondering how to get a secured card? Or not sure how to use one? We explain below.
Best Secured Credit Cards of 2020
Why this is the best secured credit card for no credit check
Unlike most credit cards, the OpenSky Secured Visa doesn’t require a credit check to apply. Also, you can build your credit history quickly because the card issuer reports to all 3 credit bureaus.
No credit check is required with the OpenSky Secured Visa, which is a rarity for credit cards.
There’s an annual fee, as well as fees for foreign transactions, inactivity and garnishment.
Why this is the best secured product for establishing credit
Whether you’re establishing your credit or repairing it, the steps necessary to qualify for your secured card develop healthy credit habits while uniquely developing a stronger credit mix – all without a credit check or history.
Besides just earning interest on your “loan” deposit, you’re building credit on both your loan and credit card while other secured cards don’t. This strengthens your credit since 10% of a good credit score comes from a solid credit mix. Plus, you can extend your credit limit based on your account’s savings progress and stay on top of your credit score with credit monitoring and account alerts.
Since the deposit is a “loan” and isn’t out-of-pocket, you can’t qualify for your card until you make 3 full consecutive payments and have at least $100 in your account without outstanding fees. On top of the one-time $9 account fee and yearly $25 annual card fee, be careful not to carry a balance since your monthly payments and credit card both carry APRs.
Why this is the best secured credit card for cash back
Earn 2% back at gas stations and restaurants for up to $1,000 spend each quarter (then 1% cash back); plus, Discover will match your cash back at the end of your first year. That means, if you spend $300 a month at restaurants and gas stations, you will earn $6 a month, plus $72 at the end of your first year for the Cashback Match, coming to $144.
With no annual fee and rewards to boot, this secured product offers another reason why it’s a good card for the long haul – you may have the opportunity to upgrade to an unsecured card after 8 months.
There’s a lot to love about this card, but the regular APR is not one of them. Higher than the average APR for credit cards, which is 17.67%, the Discover it Secured’s variable APR is one of the highest among secured cards.
From our expert
“The Discover it Secured card is noteworthy because it offers rewards – a rarity among secured cards,” says CreditCards.com Industry Analyst Ted Rossman. “With no annual fee and 2% cash back at restaurants and gas stations and 1% everywhere else, this card is a compelling introduction into the world of credit.”
Why this is the best secured credit card for wide acceptance
Because the First Progress Platinum Elite is a Mastercard, it is widely accepted both nationally and overseas, making it a great go-to card for the traveler.
This card has a new expedited processing option, which is handy if you are looking to get your new card quickly. Also, the First Progress Platinum Elite Mastercard Secured Credit Card doesn’t require a minimum score or credit history.
While not as bad as others, this card’s fees can be onerous.
Why this is the best secured credit card for no credit history required
No credit history is required with the Green Dot primor Mastercard Gold, which means that the consumer just starting out has a good shot at this card.
As an unusual feature, the Green Dot primor Mastercard Gold Secured Card offers an APR 9.99% (Fixed), which is rock-bottom by any standards. Also, there’s no minimum credit score standard.
The cash advance APR is a bloated 18.99% (Fixed), there’s an annual fee of $49, as well as $29 for additional cards. Add to that, there are fees for everything from a credit limit increase fee to an automated account information fee.
Why this is the best secured product for getting a small loan
With this financial product, you basically get a small loan that funds an FDIC-insured certificate of deposit for 12 or for 24 months. Then, once the account’s term ends, you’ve built your credit and your CD unlocks.
This is a good way to build credit for someone with iffy credit. There’s no hard pull on your credit, and it doesn’t matter where your credit is when you begin.
There’s an “administrative fee” that is on a sliding scale, depending on how much you pay into your “account.” So, if you pay $89 a month for 12 months, you pay a $12 administrative fee and you get $1,000 at the end of the year, $68 shy of what you’ve put in, bringing the total finance charge to $80.
Why this is the best secured credit card for beginning cardholders
Because no credit history is required to apply for the First Progress Platinum Select Mastercard Secured and because the online application is relatively quick, this is a strong option for the consumer just starting out.
Similar to other First Progress secured credit cards, there is an expedited processing option that allows you to receive your new card sooner.The security deposit, which ranges between $200 and $2,000, and is fully refundable.
Unfortunately, there is an annual fee of $39 in addition to some more obscure fees.
Why this is the best secured credit card for bad credit
Maybe you’ve had a late payment and your credit score has suffered. The Green Dot primor Visa Classic Secured is a great choice for the consumer whose credit isn’t their best.
No minimum credit score is required with this card, and there are no processing or application fees.
Like the Green Dot primor Visa Classic Secured card, this card’s fees include not only an annual fee, but a replacement card fee, copying charges, credit limit increase fee and so on.
Why this is the best secured credit card for low interest
It’s rare to see a credit card interest rate that’s this low, and it’s even rarer to see one that’s fixed. The Green Dot primor Visa Gold Secured offers an incredibly low 9.99% (Fixed) APR for its regular interest rate.
This card welcomes the consumer whose credit is in bad shape, something you may not see elsewhere. Also, credit lines can be up to $5,000, which can be helpful with keeping your credit utilization ratio down.
This card’s fees can nickel and dime you if you aren’t careful – in addition to an annual fee, there’s a replacement card fee, copying charges, credit limit increase fee and the list goes on.
Why this is the best secured credit card for no annual fee
This card’s no annual fee makes it a great starter card. Also, the no foreign transaction fee makes it a good card for overseas travel or making purchases on foreign sites.
The terms are fairly straightforward, and with responsible use, you could get a higher credit line in as soon as 6 months if you make your first 6 monthly payments on time.
The Capital One Secured Mastercard offers no sign-up bonus or ongoing rewards.
Why this is the best secured credit card for building credit
Unlike a debit card, the Citi Secured Mastercard helps build your credit history because the issuer reports to all 3 major credit bureaus each month. Also, you may get free access to your FICO score online.
There is no annual fee which is always a plus.
The security deposit to get started with this card can vary from $200-$2,500 based on your credit qualifications. Also, like most other secured cards, there is no rewards program with the Citi Secured Mastercard.
Compare the best secured card offers
||Minimum Deposit Required
|OpenSky® Secured Visa® Credit Card
||No credit check
|Self — Credit Builder Account + Secured Visa Credit Card
|Discover it® Secured
|First Progress Platinum Elite Mastercard® Secured Credit Card
||$200 – $2,000
|Green Dot primor® Mastercard® Gold Secured Credit Card
||No credit history required
|Self — Credit Builder Account
||Getting a small loan
|First Progress Platinum Select Mastercard® Secured Credit Card
||$200 – $2,000
|Green Dot primor® Visa® Classic Secured Credit Card
|Green Dot primor® Visa® Gold Secured Credit Card
||$200 – $5,000
|Capital One® Secured Mastercard®
||No annual fee
||$49, $99, or $200
|Citi® Secured Mastercard®
Secured credit cards analyzed: 228
Criteria used: Credit needed, ease of application, ability to move credit limits, deposit required, rates and fees, credit score tracking, other benefits and features, customer service, security, rewards rates.
What is a secured card and how do they work?
What is a secured card?
A secured credit card is a financial product designed for a consumer with bad credit or limited credit history. It requires a refundable deposit in exchange for a credit limit, typically $200 or more. Most credit cards are unsecured credit cards, which means a security deposit isn’t required. Because having a credit card is the easiest and fastest way to build credit, a secured card can be worth your while.
Secured cards vs. unsecured cards
A secured credit card is an excellent financial product for building credit when your credit hasn’t been its best. But eventually, you want to work toward an unsecured card, because options open up for you including superior rewards and benefits.
Here, we look at the different elements of secured cards vs. unsecured cards, both good and bad:
Secured cards vs. unsecured cards…
|Secured credit cards
||Unsecured credit cards
|Refundable deposit required
||No deposit required
|Lower credit limit
||More robust credit limit
|Some rewards possible
|Can have tacked-on fees
||Might have fewer fees, depending on type
|Often has annual fee
||Some, such as cashback cards, likely won’t have annual fee
What’s the difference between secured cards and credit cards for bad credit?
Some issuers offer unsecured credit cards for people with bad credit. With many of the same characteristics as secured cards but no deposit required, it may seem like the better choice. However, you’ll often times end up spending more of your own money with an unsecured card for bad credit.
Fees are usually higher with unsecured credit cards marketed toward those with bad credit than they are with secured cards. Higher annual fees, processing fees and monthly fees are all common and nonrefundable, unlike the deposit you pay to use a secured card.
The bottom line is that you should always read the Schumer box before submitting any credit card application. All fees and interest rates are legally required to appear in this easy-to-read table.
What’s the difference between secured credit cards and prepaid cards?
The most important difference between secured credit cards and prepaid cards is that secured credit cards build credit, while prepaid cards do not. Prepaid cards are more similar to debit or gift cards than credit cards; you load them with money and must reload once the account hits zero. With a prepaid card you’re not borrowing money, so the issuer doesn’t report anything to the credit bureaus.
Both secured and unsecured credit cards are forms of revolving credit, which allow you to continue borrowing up to the amount of your credit limit as you repay your debt every month.
What credit score do you need to be approved for a secured credit card?
Because you are not able to spend more than the cash deposit you provide, the issuer’s risk is much lower than it would be lending to someone with an unsecured credit card. For this reason, applicants with minimal or bad credit history are often approved for secured credit cards.
Can you be denied a secured credit card?
Yes, it is possible to be denied for a secured credit card. Though you don’t need good credit to be approved for a secured card, issuer’s can deny your application for a number of reasons, such as a previous bankruptcy or lack of income.
If your credit card application is denied, the issuer is legally required to explain why. If you don’t receive an email or letter from the issuer explaining why your application was denied, call and ask. You can also take a look at your credit report, which is free to access after being denied, and check for any errors.
Are secured cards the easiest credit cards to get?
The secured cards offered by our partners pretty much require no credit. But that doesn’t mean you are guaranteed a card. If you have a history of unpaid bills, for example, that can harm your chances. And if you have no income, that can impact whether a card is issued to you. However, a secured card is a great way to start out with credit cards and learn how they work and how to use them.
How much is a typical deposit on a secured credit card?
Most secured cards give you a credit limit to match your security deposit, although the Capital One Secured card might give you a higher limit than your security deposit.
The deposit is refundable once you close the account, and in some cases, after you’ve shown yourself to be credit-worthy, you can get your deposit back and also keep the card.
Here are 3 secured cards with the required deposit and features that make them appealing:
Typical secured card deposits…
|Capital One Secured Mastercard
||$49, $99 or $200 refundable deposit
||Access to higher credit line after first 6 monthly payments on time
|Discover it Secured
||Minimum deposit of $200
||Account reviewed monthly starting at eight months, to see if deposit can be returned
|First Progress Platinum Prestige Mastercard Secured Credit Card
||Approve at any credit score, no minimum required
How to use your secured card to build credit
Now that you know how to avoid the common pitfalls of bad card management, how do you handle one correctly? It only takes 3 easy steps:
- Pay on time. While it takes months to build your credit with good payment habits, one or two late payments can cause a big drop in your score. And not only is paying on time good for your credit, it keeps you from having to pay late fees and even losing your card.
- Pay in full. In fact, pay multiple times a month to keep your utilization ratio low – because you don’t know when your issuer will send your account information to the 3 major credit bureaus. This will also help you avoid interest charges.
- Place a small charge on the card. Don’t forget to use the card each month. If you lose your card to inactivity, you can’t build credit month by month. Put a recurring reminder on your calendar to ensure that you don’t forget. Or better yet, place an auto debit for a small charge on your card.
How to upgrade to an unsecured credit card
You probably don’t want to keep a secured card forever; for most people, secured credit cards are a bridge to bigger and better things. When you are able to upgrade, your next credit card should be a rewards card. If you have good credit and are able to pay your bill in full each month, passing up on a rewards card is like passing up on free money. In addition to higher credit limits, you’ll have the luxury of choosing whether you’d like to be rewarded cash back or travel points.
So how does upgrading your secured credit card work? Here’s what a typical timeline looks like:
Achieve good credit
If you’re serious about improving your credit, you can do so in no time with on-time payments and low balances. After your credit score is in a good place (at least 670 on a scale of 300-850), the exciting part starts. It’s time to start exploring rewards cards.
Inquire about your upgrade options
Note that some cards, such as the Discover it® Secured card, let you transition to an unsecured card after a period of time, provided your payment habits are good. Check with your card issuer.
Even if the upgrade option isn’t advertised, you may still be able to trade up by calling your issuer and asking. Heads up that you likely won’t be able to benefit from the new card as a new member, meaning you may not get such benefits as the sign-up bonus. However, you will enjoy any ongoing rewards that the new card offers.
Look into applying for a new credit card
If you don’t qualify for an upgrade or there is a disadvantage to the card you qualify for, such as an annual fee you’re not interested in, start exploring cards from different issuers. It’s worth looking into a variety of the best credit cards to find the perfect fit for your lifestyle.
Decide what to do with your old secured card
Once you find the unsecured card of your dreams, it’s time to look at whether to keep the secured card. However, only close it if there is a compelling reason, such as recurring fees that you want to break away from. Be mindful that when you close a card account, while your good payment habits don’t drop off your credit reports for 10 years, the average age of your cards will go down, which will impact your score for a while.
While secured cards are one of the top card types (as you can see below), we are all striving to get a rewards card or airline card, right? With a rewards card, you can earn tens of thousands of points or miles a year or hundreds of dollars back just by taking full advantage of the card’s offers. Here are the top cards consumers have in their wallets, which can give you the motivation to keep working on your credit building:
The credit cards in our wallets…
- Retail/store-specific card
- Other types of rewards credit cards
- Secured credit card
- Balance transfer card
- Airline-specific credit card
- Business/corporate credit card
- Student credit card
Source: Experian study
Alternatives to secured credit cards
Whether you don’t want to plunk down a security deposit or you don’t qualify for a secured card, there are a number of alternative ways to enjoy the convenience, the safety of a cashless life and even credit building. For example, with unsecured cards such as retail credit cards, you can build credit and avoid paying a deposit, all while building your credit. With a passbook loan or credit-builder loan, you can also build credit. And while you won’t build credit with debit cards and prepaid cards, some consumers prefer them for budgeting and convenience reasons.
Unsecured credit cards
Usually unsecured credit cards are for consumers with better credit, but there are some available for fair and even poor credit. However, they often have hidden, weird fees. That said, there are a few that are worth a look, such as the Discover it® Student Cash Back and the Discover it® Student chrome. Both have minimal fees and both offer rewards for restaurants, gas stations and more.
Retail credit cards
Retail cards are often co-branded with a network, such as Visa or Mastercard, and they frequently only require fair credit. There is usually no security deposit required, but the APRs are typically higher than other credit cards.
While you can’t build credit with these cards, some people use them to manage their spending. Prepaid cards can be purchased at grocery and other stores, then reloaded with money when the balance runs low. Prepaid cards are safer than cash because they have some protections by federal law.
Debit cards are attached to your checking or savings account and can be used at points of sale and as an ATM card. You won’t be able to build credit with this kind of card, and you’ll need to check your financial institution about protections because they don’t automatically have the protections of credit cards or prepaid cards.
There are different types of credit-builder loans, including unsecured loans that can be used for emergencies, such as a car breakdown, and secured loans that require you to save. As the name implies, they are designed for building credit. Community banks and credit unions often offer these lending products.
A passbook loan is a lending product secured by a savings account. According to Investopedia, some lenders lend up to 50% of the savings account balance while others lend up to 100%. You can earn interest on the account, including the amount borrowed.
Credit card features to avoid when building credit
While your choice in credit card should be based on your personal goals and finances, there are a few general rules about what to avoid or at least pay attention to. Here are things you should be wary of, particularly with a secured card:
While some fees are clearly marked in the “Schumer Box” at the top of cards’ rates and fees disclosures, lesser-known fees with credit-builder cards can be mentioned lower in the copy. They can have vague descriptions, such as “copy fee” or “telephone payment fee,” and can pile up fast. Heads up that secured cards can have among the most fees.
High interest rates
If you plan to carry a balance, you’ll want to avoid a card with high interest rates because the interest charges can pretty quickly overtake the principal when the rates are high.
High rewards, no credit-building features
Don’t be tempted by a good rewards rate. While rewards are a nice perk, your goal with a secured credit card is building credit, so you want to pick a card with features that help you do so and few fees. One great example is the Capital One® Secured Mastercard®. To start, there are only two fees – a cash advance fee and a late payment fee. What makes this card advantageous to the credit-builder, though, is this feature: As your credit score increases, so can your credit limit. You may even qualify for a limit that is higher than your security deposit, which is very uncommon among secured cards.
Laura is an editor and writer at CreditCards.com. She has written extensively on all things credit cards and works to bring you the most up-to-date analysis and advice. Laura’s work has been cited in such publications as the New York Times and Associated Press. You can reach her by e-mail at firstname.lastname@example.org and on Twitter @creditcards_lm.
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