Earn 3% cash back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement/furnishings and 2% cash back at grocery stores and wholesale clubs on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter, then earn 1%
Unlimited 1% cash back on all other purchases
A minimum refundable security deposit of $300 (maximum of $4,900) is required to open this account
Access your FICO® Score updated monthly for free, within your Mobile Banking app or in Online Banking
Optional overdraft protection option helps prevent declined purchases, returned checks or other overdrafts when you link your eligible Bank of America® checking account to your credit card. Transfer fees may apply.
A secured credit card designed to help establish, strengthen or rebuild credit
A minimum refundable security deposit of $300 (maximum of $4,900) is required to open this account
Access your FICO Score updated monthly for free within your Mobile Banking app or in Online Banking
Your account will periodically be reviewed, and, based on your overall credit history (including other credit cards and loans), you may qualify to have your security deposit returned. Not all customers will qualify.
The credit card offers that appear on this site are from credit card companies from which CardRates.com receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). CardRates.com does not include all credit card companies or all available credit card offers.
Review Breakdown: Secured Cards
Secured credit cards are a great way for those with a limited or bad credit history to improve their credit through responsible use. Finding the right secured card, however, can be tricky. Below is a summary table that makes it much easier. Compare features of the top secured cards, then simply click on your card of choice to visit its online application.
The best secured credit cards may initially have higher upfront costs, but they can provide tremendous savings as you attempt to build (or rebuild) your credit history.
A secured credit card will require a refundable security deposit for approval. The amount of your deposit typically determines your card’s credit limit. Going the secured card route can provide you with a larger credit limit than an unsecured credit card for bad credit.
And just like any other credit card, a secured card will report your payment history to each major credit bureau, which helps you improve your credit score with on-time payments.
1. What is a Secured Credit Card?
A secured credit card is a financial product designed to help consumers build — or rebuild — their credit score. These cards work like any other credit card. You can use them to make purchases, pay bills, shop online, or pay for a service that does not accept cash.
You will need to submit a refundable security deposit to qualify for a secured credit card. As the card’s name suggests, your deposit secures your account if you stop making payments.
The deposit does not act as payment. You still must make your regular monthly payments after you submit your security deposit. But if you close your secured credit card account in good standing — and with no active balance — your secured credit card issuer will refund your entire balance to you.
And since you’re backing your account with a form of collateral in a security deposit, you won’t have to worry about your credit score keeping you from credit card approval. Many secured credit cards won’t even require a credit check for approval.
If you open a secured credit card with an issuer that also has unsecured credit cards in its portfolio, you may undergo periodic reviews that check your account status and credit score so the issuer can upgrade you to an unsecured card if you qualify. Your security deposit will be refunded to you during the transition to an unsecured card, assuming you have no outstanding debts owed to the issuer.
Other than the mandatory security deposit, your secured card will act just like any other credit card — and will include the credit-building benefits of any other unsecured credit card on the market.
2. How Does a Secured Credit Card Work?
On the surface, you can not tell the difference between a secured credit card and a traditional credit card. Both have a credit card network logo — typically Visa or Mastercard — on the front. You can use these cards anywhere that accepts that network’s cards.
But since a secured credit card is designed for someone who has bad credit or very limited credit, banks require a security deposit for approval. It’s like when you’re renting an apartment and the landlord requires a deposit before you move in.
Just as you get your deposit back if you don’t trash the apartment, the credit card issuer will refund your deposit once you close your account — as long as you have no debt with the issuer when you cancel the card.
You may not have to undergo a credit check to receive a secured credit card. Your cash deposit — and an eligible bank account — is enough for most issuers to approve your application. Your deposit will usually determine your credit limit. For example, a $500 security deposit will net you a $500 credit limit.
Some secured credit cards charge lower APRs than unsecured credit cards because your deposit offsets the risk the bank assumes when it issues a collateral-free credit card to someone who has bad credit. Although the upfront deposit may seem unfair, you at least get that money back.
Most secured credit cards report your payment history to each major credit bureau, which is what helps build credit history when you consistently make on-time payments and keep your balance low. That can help you eventually upgrade to an unsecured credit card with fewer fees and more perks.
3. How Do You Get a Secured Card?
Consumers sometimes confuse a secured credit card with a prepaid card. You can find prepaid cards at just about any grocery or convenience store — often on the same rack with various gift card options. But these are not credit cards and won’t help your credit score.
To get a secured credit card, you must apply for one through an issuer’s website. You can find links to each issuer’s website and official applications above.
Once you submit your application, the issuer will forward you to a portal where you can link an active checking account and transfer your security deposit to the bank. This typically takes one to three business days to complete.
Once the bank receives your deposit, the credit card issuer will print your card and send it to you in the mail. The card can take seven to 10 business days to arrive.
Once you receive your card, you can activate it online or over the phone and begin using it immediately.
4. How Does a Secured Card Help You Build Credit?
Credit card issuers and other lenders submit your payment history and current balance every month to one or all of the three credit reporting bureaus — Equifax, TransUnion, and Experian.
The submitted information goes onto your credit history. On-time payments and low balances improve your credit scores. Late payments can sink your score by as many as 100 points in one fell swoop.
If you have negative items on your credit score from past mistakes — or if you’re new to credit and don’t have enough reported information to record a score — you can build your credit by adding new, positive items to your credit history.
Reported entries lose their impact on your credit history over time. Newer items always carry more weight with lenders because they show your current financial track record. By keeping your account in good standing, you can improve your credit history and work your way toward qualifying for an unsecured card.
5. What is the Easiest Secured Credit Card to Get?
There isn’t a concrete answer to this question because just about every secured card has the same odds of approval. As long as you aren’t in active bankruptcy, you have an active checking account, and can submit a security deposit, you will likely be approved for any secured credit card that you apply for.
Most of the cards on this list require a refundable security deposit of at least $200 or $300 to initiate your account. Some cards will not allow you to add to your deposit at a later date if you want to increase your credit limit. Others may accept another security deposit at a later date — for a fee.
The only exception to the security deposit rule is the Secured Mastercard® from Capital One. This card uses your credit history to determine the amount of security deposit you will need to pay. Depending on the condition of your credit score, you could pay as little as $49 to receive an initial $200 credit limit.
That is another big difference between the Capital One® card and other secured cards. You can get a larger credit limit based on the amount of your security deposit on other secured cards. For example, you can have up to a $4,900 credit limit with the Bank of America® Cash Back Secured Credit Card. But with Capital One, every new secured cardholder starts with the same credit limit.
The bank will monitor your account and check every six months to see whether you qualify for a card upgrade or credit limit increase. If you receive a credit limit increase, you will not have to add to your security deposit for the benefit.
6. What is the Minimum Credit Score Needed to Get a Secured Card?
There is no minimum credit score requirement for a secured credit card because your security deposit makes up for your lack of credit history or previous credit mistakes.
Some examples in which you may not be approved for a secured credit card include having an active or recently discharged bankruptcy case, unverifiable income, or a lack of funds for the security deposit. You may also fail to qualify if you have a recent foreclosure or accounts that are currently in collections or default.
If you are denied, you can contact that card’s issuer and speak to a representative to explain your needs and current status. While this does not guarantee approval, it often helps you add some background information to your application, making it easier for the bank to consider your request for credit.
7. Which Banks Offer Secured Credit Cards?
Just about every major bank or credit union offers some form of a secured credit card.
On our list above, you can find secured cards from major national banks, including Bank of America, Capital One, and Citi. You can also find secured credit card offerings through many smaller regional banks and credit unions as well as independent online banks, such as Applied Bank, Merrick Bank, and OpenSky.
The number of secured credit card offerings in America alone can climb well into the thousands. If you have an active account at a bank or credit union and are interested in acquiring a secured credit card to improve your credit score, you can contact a branch and speak to a representative about the institution’s current offerings.
8. How Fast Can You Rebuild Credit with a Secured Card?
This depends on how bad your credit score currently is. If you have a recent bankruptcy, foreclosure, or other large negative item added to your credit profile, it could take more than a year to make a noticeable difference. If you are battling a few late payments, you may see improvement in a matter of months.
Every negative item lives on your credit report for a set amount of time. As each item gets older, you will find that it loses its impact on your credit score — as long as you replace it with newer and more positive items.
When building credit with a secured credit card, maintain a low balance to keep your credit utilization in good shape, and always make on-time payments. Your credit score will improve steadily over time, but remember to remain patient during this process. Rome wasn’t built in a day and neither is an excellent or good credit score.
9. Can You Be Denied a Secured Credit Card?
As with any other financial product, the bank or issuing company that receives your application can decide whether it wants to approve or deny you credit.
While a secured credit card is fairly simple to qualify for — so long as you have the required cash to pay the refundable security deposit — instances in which you may be denied credit include:
A recent or active bankruptcy case
An extremely low credit score that shows an inability to repay debt
Recent foreclosures, repossessions, or collection accounts
Errors on your application that make the form impossible to process
No verifiable income
No way to verify your identity
Whenever you receive a credit card application rejection, the issuing bank must, by law, send you an adverse action letter that details why you did not qualify for the card or loan. You will get the full reasoning for the rejection as well as some tips on how to improve your credit report and score to change future application outcomes.
Create a plan of action to improve your credit score over time. In many cases, this will require you to simply be patient and wait for current negative items to age off of your credit profile.
You can often expedite the process by finding ways to add new, positive items to your history. You can do this by qualifying for a small personal loan with the help of a cosigner. You can also consider applying for a store-branded card or credit line.
Store credit cards are often closed-loop cards, which means they can only be used at the store where you applied for it — but they are often easier to qualify for and won’t require a security deposit for approval.
10. Are there Secured Business Cards?
Small businesses often struggle to build business credit. That means that the business owner must use his or her personal credit history to qualify for a business line of credit.
If you have bad credit, that may mean that your business does not get access to the funding it needs to survive. Thankfully, some banks offer secured business credit cards.
Wells Fargo and BBVA are two major banks that offer a secured business credit card. They both require an initial deposit to secure the line of credit, and both offer rewards that can be redeemed for cash back or other products and services that can benefit your business.
Wells Fargo and BBVA both offer secured business credit cards that offer purchase rewards and business benefits.
While these are technically business credit cards, they require the business owner to apply for the card under his or her name if the business doesn’t have established credit history.
11. Do You Need a Bank Account to Get a Secured Card?
In just about every scenario, a secured credit card company will require an active checking or savings account to qualify you for a card.
You use this account to send your refundable security deposit and make your regular monthly payments. The bank will also use your account to verify income and payment history information.
The one positive is that you don’t necessarily need a checking or savings account with the bank that issues your card.
For example, you won’t need a checking account specifically with Citi to qualify for the Citi Secured Mastercard. Instead, you can link your active account through a local or online bank or credit union to send your deposit and make your monthly payment.
That said, it does not hurt to open an account with the bank that issues your secured credit card — especially if you are shopping for the card in hopes of improving your credit score.
A secured credit card is the beginning of a relationship-building process with a lender. When you open a regular account with that lender — one in which you can receive direct deposits of your paycheck or benefits checks — you can solidify the relationship even more.
That can lead to an eventual card upgrade or approval for other loans and financial products. When you build a good history with a specific bank, it is far more likely to consider future applications than if you were a one-time customer who comes and goes.
12. How Long Before a Secured Card Becomes Unsecured?
This depends on the current state of your credit score. If you have recent judgments, defaults, foreclosures, or repossessions, a bank may ask you to reapply after more time has passed since the reported incidents.
The same goes for late payments. Banks often view your most recent activity with more scrutiny than they do past items. A late payment last month is far more damaging than a missed payment last year. If you only have a few negative items that aren’t catastrophic, you could qualify for an upgrade to an unsecured credit card in as little as six months.
Some card issuers, most notably Capital One, provide an automatic credit line increase program that monitors your account every six months to see whether you qualify for a credit limit increase. If you have a secured credit card, you could qualify for either a credit limit increase or an upgrade to an unsecured credit card.
In most cases, a bank will not consider your application for an upgrade for at least six months. When you do officially qualify, the bank will send your new card in the mail, which can take seven to 10 business days. You will also receive a refund of your security deposit, minus any debts that you may owe to the credit card company.
13. What Kind of Fees are Associated with Secured Cards?
Having bad credit is not cheap. Most financial products that cater to consumers who have bad or limited credit tack on substantial fees and charges to offset the risk that such products come with.
Thankfully, secured credit cards allow you to recoup most of your costs associated with the card since your security deposit is fully refundable as long as you close your account in good standing with no debts.
That does not mean these cards are completely free to use, though. As a secured credit cardholder, you may have to pay:
Interest Rate Charges: This is the regular purchase APR you’re charged for purchases made with the card. This charge generally ranges from 9.99% to 29.99%, depending on the card. You can avoid this fee altogether by paying your balance in full each month.
Annual Fee: These vary by card issuer. Some secured credit cards will not charge an annual fee, whereas others may charge anywhere between $35 and $99 each year to keep your account open. In most cases, the fee is deducted from your available balance.
Maintenance Fees: This is rare for secured cards, but becoming increasingly more common for unsecured cards for bad credit. These fees are charged monthly to your account and typically cost around $9.99. Check your credit card disclosure document to make sure your card doesn’t charge maintenance fees. If it does, find another card.
Cash Advance Fee: Some secured credit cards allow you to get a cash advance, where you withdraw money from your available credit line directly from an ATM machine or bank teller. The fee for this type of transaction is usually $10 or 3% to 5% of the cash advance amount, whichever is greater.
Foreign Transaction Fee: You may be charged a foreign transaction fee if you use your card to make a purchase overseas. This fee is usually around 3% of the purchase total. Banks charge this fee to cover the cost of converting foreign currency to U.S. dollars, but not all cards charge foreign transaction fees.
Balance Transfer Fee: Not all secured cards allow balance transfers, but if yours does, you may be charged a fee of between 3% and 5% of the total balance you transfer to the new account. You generally need a good credit score to be offered a balance transfer promotion.
Miscellaneous Fees: Some secured credit cards may charge you if you want to add to your security deposit to increase your credit limit. Other cards may qualify you for a credit limit increase without requiring you to add to your deposit — but you will still have to pay a fee. You may also have to pay a fee to replace a lost card, add another user to your account, or change your card’s design.
Fees are an unfortunate part of financial life. But with one of the best secured credit cards, you can pay fewer fees to access credit and improve your credit score over time. And although the upfront cost may seem daunting, you get that money back in time, as long as no money is owed to the issuer in the end.
Editorial Note: Opinions expressed here are 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.
The information on this page was reviewed for accuracy on .
About the Author
Brittney is a Credit Strategist and Finance Expert who has spent years honing her knowledge of the credit industry both personally and professionally. Brittney applies her more than a decade of research experience to crafting in-depth consumer guides designed to help CardRates readers make better, more informed financial decisions.
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Advertiser Disclosure: The credit card offers that appear on this site are from credit card companies from which CardRates.com receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). CardRates.com does not include all credit card companies or all available credit card offers. See the credit card issuer's website for specific terms and conditions of each card.