Trying to build your credit? Consider these secured credit cards

Apr 21, 2020

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Not everyone can be approved for a rewards credit card. If you have limited credit history — or have made some credit mistakes in the past and have a bad or poor credit score — you may want to use a secured credit card while you work to improve your credit. Here are some of the best options that are available, as well as answers to some commonly asked questions about secured credit cards.

Note: The Discover it Secured is not currently available through The Points Guy and the information about it may be out of date.

New to The Points Guy? Sign up for our daily newsletter and check out our beginner’s guide.

Best secured credit cards in 2020

  • Discover it Secured: Best for earning rewards
  • Capital One® Secured Mastercard®: Best for card perks
  • Citi® Secured Mastercard®: Best for contactless payments
  • BankAmericard® Secured credit card: Best for higher potential credit line
  • OpenSky® Secured Visa® Credit Card: Best for no credit check
  • Green Dot Platinum Visa® Credit Card: Best for those without a bank account

In This Post

Comparing the best secured credit cards

Secured credit card Best for minimum deposit required Annual fee
Discover it Secured Earning rewards $200 None
Capital One® Secured Mastercard® Card perks $49, $99 or $200 None
Citi® Secured Mastercard® Contactless payments $200 None
BankAmericard® Secured credit card Higher potential credit line $300 None
OpenSky® Secured Visa® Credit Card No credit check $200 $35
Green Dot Platinum Visa® Credit Card Those without a bank account $200 $39

The information for the Discover it Secured, Capital One Secured Mastercard, Citi Secured Mastercard, BankAmericard Secured credit card and Green Dot Platinum Visa Credit Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Note that your local bank or credit union may have additional secured credit card options for you to consider. For example, if you’re a member of the Navy Federal Credit Union, you may want to consider the Navy Federal Credit Union nRewards® Secured Credit Card.

Now, let’s take a closer look at each of these cards that are available to the general public. Some cards don’t even require that you have a checking account or savings account with a bank.

Best secured credit cards

Discover it Secured: Best for earning rewards

(Photo by Orli Friedman / The Points Guy)
(Photo by Orli Friedman/The Points Guy)

Annual fee: None

Minimum security deposit: $200 for a $200 credit line.

How to get a higher credit line: You may be approved for a credit limit of up to $2,500 based on your income and ability to pay, but your security deposit must equal your credit limit.

Variable APR: 22.99%

Who should apply: The Discover it Secured is one of the few secured credit cards that earns rewards. With this card, you can earn 2% cash back at gas stations and restaurants on up to $1,000 in purchases each quarter you enroll and 1% cash back on everything else. Plus, Discover will match all the cash back you’ve earned at the end of your first year. This means you can earn rewards while you work to build your credit by using your card responsibly and paying your bill each month.

As a cardmember, you can check your FICO score for free and you won’t pay any foreign transaction fees when you use your card abroad. After you’ve been a cardholder for eight months, Discover will automatically review your account monthly to see if you are eligible to get your security deposit back and move to an unsecured card. Discover also will waive the late payment penalty fee the first time you pay late.

Related reading: Your ultimate guide to Discover cards

Capital One Secured Mastercard: Best for card perks

(Photo by Isabelle Raphael / The Points Guy)
(Photo by Isabelle Raphael/The Points Guy)

Annual fee: None

Minimum security deposit: $49, $99 or $200 for a $200 credit line.

How to get a higher credit line: You can raise your initial credit line by the amount of your additional deposit, up to $1,000. If you make your first five monthly payments on time, you’ll get access to a higher credit line with no additional deposit needed. You may also earn credit line increases based on your payment history and creditworthiness.

Variable APR: 26.99%

Who should apply: The Capital One Secured Mastercard is one of the few secured credit cards that may extend you a credit line that’s greater than your security deposit. The card can be a good choice since it has many perks, including no foreign transaction fees, auto rental collision damage insurance, travel accident insurance and extended warranty protection. It comes with CreditWise®, which gives you alerts when your TransUnion® or Experian® credit report changes. Account alerts from Eno® will warn you if Capital One detects a potential mistake or unexpected charge, such as a potential duplicate purchase or a sudden recurring bill increase. Plus, Eno allows you to pay for online purchases with virtual card numbers and keep your actual card number to yourself.

Related reading: The best Capital One credit cards

Citi Secured Mastercard: Best for contactless payments

(Photo by Isabelle Raphael / The Points Guy)
(Photo by Isabelle Raphael/The Points Guy)

Annual fee: None

Minimum security deposit: $200 for a $200 credit line.

How to get a higher credit line: You may be approved for a credit limit of up to $2,500, but a security deposit is required for the amount of your credit limit.

Variable APR: 22.49%

Who should apply: The Citi Secured Mastercard is a contactless-chip enabled card so you can tap to pay. You’ll get free access to your FICO score online as a cardholder and you can choose to pay your bill on any available due date in the beginning, middle or end of the month. However, there is a 3% foreign transaction fee, so this isn’t the card for you if you plan to make purchases outside the U.S.

Related reading: The best Citi credit cards

BankAmericard Secured credit card: Best for a higher potential credit line

(Photo by The Points Guy)
(Photo by The Points Guy)

Annual fee: None

Minimum security deposit: $300 for a $300 credit line.

How to get a higher credit line: You may be approved for a credit limit of up to $4,900, but a security deposit is required for the amount of your credit limit.

Variable APR: 22.99%

Who should apply: With the BankAmericard Secured Credit Card, you can access your FICO Score, updated monthly, for free. Plus, Bank of America will periodically review your account and, based on your overall credit history, you may qualify to have your security deposit returned while being able to continue using your account. Your card will have chip technology, but there’s a 3% foreign transaction fee, so you won’t want to use your card frequently abroad.

Related reading: The best Bank of America credit cards

OpenSky Secured Visa Credit Card: Best for no credit check

(Photo by Wyatt Smith / The Points Guy)
(Photo by Wyatt Smith/The Points Guy)

Annual fee: $35

Minimum security deposit: $200 for a $200 credit line.

How to get a higher credit line: Subject to approval, you can make a security deposit of up to $3,000 to get a credit line of up to $3,000.

Variable APR: 17.39%

Who should apply: The OpenSky Secured Visa has a $35 annual fee, but the card may be the best option for some consumers because there’s no credit check when you apply. You can change your monthly due date once per year to align with your schedule. Although it’s easiest to fund your security deposit using a debit card, you can also use Western Union or mail a check or money order to make your deposit. However, monthly payments should be made online by using the mobile app or by sending in a check. The card charges a 3% foreign transaction fee.

Related reading: How to check your credit score for absolutely free

Green Dot Platinum Visa Credit Card: Best for those without a bank account

(Photo by Orli Friedman / The Points Guy)
(Photo by Orli Friedman/The Points Guy)

Annual fee: $39

Minimum security deposit: $200 for a $200 credit line.

How to get a higher credit line: You may be approved for a credit limit of up to $5,000, but a security deposit is required for the amount of your credit limit.

Variable APR: 19.99%

Who should apply: There’s no credit check required to open the Green Dot Platinum Visa Credit Card, and the Green Dot Platinum is one of the few secured credits that doesn’t require you to have a bank account. You can make your initial security deposit and monthly payments online for free or at eligible retailers nationwide for a service fee of $4.95 or less. The card has a 3% foreign transaction fee.

Related reading: Why a credit card is a smarter choice than a debit card

What is a secured credit card?

A secured credit card requires a security deposit from the cardholder when the account is opened. This security deposit is usually refundable and determines your initial credit limit. Secured credit cards are often used by consumers without credit history or with low credit scores and can be useful for building or repairing credit.

Related reading: Secured vs. unsecured credit cards: What you should know

How we chose the best secured credit cards

In choosing the best secured credit cards for this guide, we prioritized cards that don’t charge an annual fee and do report credit activity to the three main credit bureaus. Reporting activity to credit bureaus is important, since you’ll want your activity on the card to help improve your credit score. We also included some cards with modest annual fees that have unique perks or aspects that may make them the best option for some consumers.

We didn’t put much weight on the APR rate, as you’ll want to ensure you can pay off your balance each month to work on building or repairing your credit. And, although this article is on The Points Guy, you shouldn’t put too much weight on the rewards earning rate, since you’ll generally only keep your secured card until you’ve built or repaired your credit enough to move to a rewards credit card.

Related reading: How to choose the right credit card for you

Should I get a secured credit card?

Secured credit cards are best used for building or repairing credit. If you don’t have strong enough credit to be approved for most beginner credit cards, and you don’t have any trusted friends or family members that are willing to add you to their account as an authorized user, a secured credit card can be a way to getting a credit card and work to improve your credit score.

You should see a secured credit card as a stepping stone to an unsecured rewards credit card. If you can already get approved for an unsecured rewards credit card that doesn’t have high fees, you won’t need to consider getting a secured credit card.

Related reading: Travel rewards strategies for people with low credit scores

How does a secured credit card help build or repair credit?

If you’re looking to build or repair your credit with a secured credit card, you’ll want to make sure the card you get will report your payment activity to the credit bureaus. All of the cards described in this guide advertise that they do so — after all, card issuers realize that most people using secured credit cards are working to build or repair credit.

Related reading: What credit score do you need to get the Chase Sapphire Preferred card?

With a secured credit card, you’ll generally start with a low credit line. So, to build or repair your credit, you’ll initially want to make small, infrequent purchases and focus on paying off your balance in full each month.

The issuer may eventually offer you a higher credit line, which can help your credit score as long as you keep your utilization low. It’s also a good idea to check your credit score regularly while working to build or repair your credit.

Related reading: The best first credit cards

Is it worth it to pay an annual fee on a secured credit card?

Generally, it’s not worth paying an annual fee on a secured credit card. However, if you don’t want the issuer to perform a credit check or you don’t have a bank account, you may need to pay an annual fee to get access to a secured credit card. And, although you should be paying your credit card bill in full every month to improve your credit score,  if you are looking for a secured credit card with a low APR, you’ll usually need to pay an annual fee.

Related reading: Guide to credit card annual fees

Featured photo by Isabelle Raphael/The Points Guy.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.