Secured credit cards

Compare secured credit cards and learn how they work.

By   |   Verified by Yvonne Taylor   |   Updated Dec. 4, 2023

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Comparing secured credit cards

Chime Credit Builder Secured Visa® Credit Card

On website

Chime Credit Builder Secured Visa® Credit Card

Balance transfer


Purchase rate

0% p.a. ongoing

Annual fee

$0.00 p.a. ongoing


  • No interest or annual fees.
  • No credit check to apply.
  • No minimum security deposit is required.

Disclaimer: Chime is a financial technology company, not a bank. Banking services provided by, and debit card issued by, The Bancorp Bank or Stride Bank, N.A.; Members FDIC.

Discover it® Secured Credit Card

Discover it® Secured Credit Card

Balance transfer


Purchase rate

22.99% p.a. ongoing

Annual fee

$0.00 p.a. ongoing


  • Get a real credit card with no annual fee.
  • Your credit line will equal your deposit amount, starting at $200.
  • Build credit responsibly with this your Discover it® Secured Credit Card.
Capital One Platinum Secured Card

Capital One Platinum Secured Card

Balance transfer


Purchase rate

30.74% p.a. ongoing

Annual fee

$0.00 p.a. ongoing


  • $0 p.a. annual fee.
  • With responsible card use, you could earn back your deposit and upgrade to a standard, unsecured Platinum card
  • No foreign transaction fees. No replacement card fees. No authorized user fees.
Citi Secured Mastercard

Citi Secured Mastercard

Balance transfer


Purchase rate

27.74% p.a. ongoing

Annual fee

$0.00 p.a. ongoing


  • The Citi® Secured Mastercard helps you build a credit history for your financial future with no annual fee. If approved, a security deposit is required for the amount of your credit limit, between $200 - $2,500.
  • Choose to pay your bill on any available due date in the beginning, middle or end of the month.
  • Digital Wallets let you shop with confidence in millions of places online, within apps and in stores.

Simply put, a secured credit card uses the money that you deposit in a security account as collateral. This money gives lenders the confidence that you’ll be able to pay them back even if you have no credit history, or a damaged credit score or credit history. Should you fail to pay back your bill, the lender can use your deposit to meet the repayment.

One of the biggest advantages of using a secured card is that it can help to improve your credit score. But keep in mind that for this to happen, you need to make payments on time every month.

Annual fee and other fees

Most credit cards have an annual fee, but some come with a $0 annual fee. You may want to take advantage of a card with no annual fee, but in doing so you could be missing out on benefits attached to the card, advantages worth more than the annual fee charged.

In some cases, you may also have to pay other fees, such as a set-up fee, a foreign transaction fee, cash advance fee or late payment fee, so be sure to read the fine print to avoid any surprises.

Interest rates and repayments

Interest rates on secured credit cards are usually higher than the ones on unsecured cards, so it’s important to always pay your balance in full each month, before interest can be charged. Having a plan to make regular full payments works to your advantage and is absolutely vital in building your credit. This will also eventually lead to your transition onto unsecured credit cards.

Credit repair and establishment

If you’ve missed payments in the past, then it’s likely that you have damaged your credit history and credit score. To get things back on the right track, consider applying for a secured secured card and making a security deposit. Using the card responsibly will help to improve your credit score.

Getting a secured card may also be the right move if you are only starting to build your credit history. While the deposit and annual fee may be expensive, setting a budget with this kind of credit card can be the solution to re-establishing your credit.

Credit history and score

Because the lender relies on the amount of money you've put down as your deposit, your credit check isn't as much of an issue when it comes to secured cards as it is with traditional cards. The lender sees your deposit as a guarantee of payment, instead of just using your credit score as an indication of whether you can pay or not. As a result, your application for a secured card will more likely be approved.

Online payments require a card

While some people may prefer to use cash, cash can't be used for online shopping. If you plan to pay bills online, you'll need to have a card handy.

Learn about secured credit cards

A secured credit card is pretty simple really. Here's what you need to know.

  • FAQs

  • Pros & cons

  • Tips

Can you get turned down for a secured credit card?

Yes. Unfortunately, even though a secured credit card is meant to help people who have bad credit, it still has a few requirements that need to be satisfied before being approved, such as a minimum credit score.

Which banks have a secured credit card?

There are more than 30 banks and credit unions that offer secured credit cards, including six of the largest credit card issuers. Here is a list of the major banks offering secured cards:

  • Bank of America
  • Capital One
  • Citi
  • Discover
  • U.S. Bank
  • Wells Fargo

Here are some of the smaller banks and credit unions that offer secured cards:

  • Capital Bank
  • First Progress
  • Green Dot
  • OpenSky

What is a secured credit card?

Secured credit cards are backed by a cash deposit from you, the cardholder. The cash acts as collateral for the credit card account. This means that the issuer has security in case you’re not able to make payments on your balance. In general, secured credit cards are viewed as suitable for people who are just getting started with their credit or have a bad credit history that they want to repair.

How do secured credit cards work?

Secured credit cards work in the same way as traditional credit cards, which means they can be used to make everyday purchases and in transactions where debit cards or cash aren’t accepted — such as making an advanced booking for a hotel room.

A secured credit card also:

  • Helps to establish or rebuild credit. It's even more important to make monthly payments on time with a secured card than it is with a standard credit card. With secured cards, you need to remember that failing to make payments means that not only will your card issuer keep some, if not all, of your deposit, it will also damage your poor credit even further.
  • Helps you transition to a traditional unsecured card. Many secured credit card accounts are automatically reviewed by the card issuer to see if you can qualify to get transferred to an unsecured credit card. When this happens, you’ll get your deposit back.
  • Benefits you when used responsibly. Responsible use of a secured card will eventually lead to lower interest rates on cars, mortgages, and other big-ticket items.

How do I apply for and use a secured credit card?

While every issuer may handle things differently, the process pretty much follows a flow like this:

  1. Applying for the card. After you complete and submit the application form, the card issuer will evaluate how much of a risk you are by performing a credit check. If you pass this stage, you are approved.
  2. Funding the deposit. Before an issuer opens your account, you need to first pay your security deposit. In some cases, you will be given time to pull your money together to make the deposit. Or you may need to give information about your bank account so you that the deposit can be transferred right away.
  3. The card is sent to you. When you’ve made the deposit for your account, the issuer will send your new card to you. You will be able to use it just like a traditional credit card. Try to only use it for a few small purchases every month and remember to always pay on time.
  4. Pay your bill each month. Remember to pay your bill in full and on time every month to avoid incurring interest charges, since these cards tend to have very high interest rates. The better your record is, the better reports your issuer will send to the 3 major credit bureaus, which will improve your credit history and score.
  5. Upgrade your card. As your credit transitions from bad to good, you’ll be able to qualify for better credit cards, depending on your issuer.

Do secured credit cards help your credit?

Yes. Making full and on time payments of your balance can have a positive impact on your credit. And if you’re able to keep going with a good record, some issuers may even offer you a better card in as little as 6 months.

What is a security deposit on a credit card?

The security deposit serves as a refundable deposit that provides the card issuer’s safety net in case you fail to make payments on your credit card. Your issuer holds this deposit and only makes use of it should you default on payments.

How much is the security deposit?

Some cards may have a minimum deposit of $500, but in some cases you may be able to offer as little as $200 or $300. Just remember that your credit line limit is determined by the amount of your security deposit.

High rate of approval

Even if you have limited credit history, or your FICO credit score is low , you have a much better chance of getting your secured card application approved than you would with a standard credit card application.

Build credit

The biggest driving force that people have for using a secured card is to successfully rebuild their credit score. Making timely payments towards balances from purchases will help you build your credit score. This eventually leads to increased borrowing power and lower interest rates on a standard unsecured card.

It's possible to find a card with perks

Thankfully, some of the best secured credit cards now share this advantage with their unsecured counterparts. A few cards now come with low-cost or free benefits, and depending on the card, this can range from cash back on purchases to free purchase protection insurance or a low-interest balance transfer option.

You can set your credit limit and limit your spending

Having a secured card is a smart way to set the credit line limit you're given, since your credit line limit will normally be the same amount as your security deposit. This is another great advantage for people who struggle to manage the way they spend money. It's also helpful for those who can be easily tempted to overspend with a higher balance.

No guarantee of approval

Although your chances of being approved for a secured credit card with poor or limited credit are higher than they would be for an unsecured card, there's still no guarantee that your application will be approved.

Higher interest rates

Secured credit cards tend to have a higher interest rate to compensate for the bank's higher risk. This is just one of the reasons why it's vital that you pay off your balance in full each month. Doing so will help you avoid interest charges that may snowball out of control.

Higher fees

Most credit cards will come with different kinds of fees, but secured credit cards will have higher fees compared to standard credit cards. These fees may include an annual fee and monthly fees as well as any startup fees applicable when getting your card.

Lower spending limits

Getting a higher credit limit on a secured credit card can be hard since the limit you’re given is based on the deposit amount you make. Furthermore, a secured card generally isn’t given an increase to the initial credit line the longer you use it. In short, your only wiggle room is in what you’re willing to offer in terms of a security deposit.

It’s always smart to start small

As already mentioned, the amount you put down as your deposit will be used as collateral in case you miss payments. Therefore, your security deposit will dictate what kind of credit line limit will be placed on the card. If you’ve had prior difficulties with paying your balances, it’s probably best to start with a smaller credit limit, as a reminder not to overspend.

Save with low-interest rate cards

You can save a lot on interest charges by looking for a card with the lowest interest rate. While it’s true that most secured cards will have a higher interest rate than most standard credit cards, there are a few that offer competitive rates. All you have to do is spend some time researching and comparing cards before committing to a particular card.

Compare all the features of competing cards

Instead of just opting for the first secured credit card that you see, it's best to compare cards side-by-side online. Look at all features to get the best secured credit card, including:

  • APR
  • Annual fee
  • Other possible fees, such as set-up fee, foreign transaction fee, cash advance fee, late payment fee advance fees
  • Any perks attached to the card, such as cash back, rewards points or free insurance
  • Minimum required security deposit amount
  • Frequency of reporting to the 3 major credit bureaus
  • Regularity of account review for transition to an unsecured card

Make sure your credit report is updated

Unfortunately, some credit card issuers don’t report a user’s payment history to the 3 major credit bureaus. This can be a huge problem for those who are trying to rebuild credit. If your payments aren’t consistently reported, there will be no impact to your credit and it won’t improve. In cases like this, read your card's terms and conditions for information on how often they make a report to the credit bureaus. If necessary, contact the card issuer to see if they can update your payment history more often.