BEST OF

Best Secured Credit Cards of October 2021

NerdWalletOct 20, 2021

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Whether you're looking to build credit from scratch or rebuild credit after a bad setback, a secured credit card can be an invaluable tool. Secured cards require you to provide a cash security deposit, usually equal to your credit line. The issuer holds the deposit in case you don't pay your bill; you get the deposit back when you upgrade to a regular "unsecured" card or close the account in good standing. Because the deposit protects the issuer from losing money, secured cards are easier for people with bad credit or no credit to qualify for.

As you use the card, the issuer reports your activity to the credit bureaus — the companies that compile the credit reports that form the basis of credit scores. Keep your balance relatively low and pay your bill on time every month, and you can begin to strengthen your credit. Learn more about secured cards.

NerdWallet's Best Secured Credit Cards of October 2021

Our pick for

Rewards and upgrading

Discover it® Secured Credit Card
Apply now

on Discover's website, or call 800-347-0264

Discover it® Secured Credit Card

5.0

NerdWallet rating 
Apply now

on Discover's website, or call 800-347-0264

Annual fee

$0

Intro APR

10.99% intro APR on Balance Transfers for 6 months

Regular APR

22.99% Variable APR

Recommended Credit Score

When you consider the rewards, the lack of an annual fee and the opportunity for an upgrade, the Discover it® Secured Credit Card is the best secured credit card we've seen.

Pros

  • The rewards on this card — 2% cash back on up to $1,000 worth of spending per quarter on restaurants and gas, and 1% on all other spending — would be pretty decent on a regular card. For a secured credit card, they’re unheard of. After eight months, Discover automatically evaluates your account for possible upgrade to an unsecured card. And the annual fee is $0.

Cons

  • The initial deposit must be paid with a bank account; if you’re unbanked, you’re out of luck. For some people, the $200 minimum deposit will be a stretch. For others, the maximum $2,500 credit limit will be too low.

Read full review
  • No Annual Fee, earn cash back, and build your credit with responsible use.

  • Using your secured credit card helps build a credit history with the three major credit bureaus. Generally, prepaid and debit cards can’t do that.

  • Establish your credit line with your tax return by providing a refundable security deposit of at least $200 after being approved. Bank information must be provided when submitting your deposit.

  • Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.

  • Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases – automatically.

  • Discover is accepted nationwide by 99% of the places that take credit cards.

  • Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score

  • INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match.

  • Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.

  • View Rates & Fees

Our pick for

Low deposit

Capital One Platinum Secured Credit Card
Apply now

on Capital One's website

Capital One Platinum Secured Credit Card

4.9

NerdWallet rating 
Apply now

on Capital One's website

Annual fee

$0

Intro APR

N/A

Regular APR

26.99% Variable APR

Recommended Credit Score

The Capital One Platinum Secured Credit Card may not be a good fit for folks recovering from major credit damage, but it could be an excellent match for someone getting a credit card for the first time.

Pros

  • With most secured cards, your deposit must be equal to your credit limit. But with the Capital One Platinum Secured Credit Card, you can get a limit of $200 for a deposit of $49, $99 or $200. If you can’t come up with your whole deposit upfront, you can pay it in installments before activating your card. Pay your bill on time, and you can also be automatically considered for a higher credit line in as little as six months.

Cons

  • Underwriting standards are tighter than for many other secured cards. You generally won’t qualify if you don’t have a checking or savings account, if you have non-discharged bankruptcy, or if your rent is almost as high as your monthly income, among other reasons.

Read full review
  • No annual or hidden fees. See if you're approved in seconds

  • Building your credit? Using the Capital One Platinum Secured card responsibly could help

  • Put down a refundable security deposit starting at $49 to get a $200 initial credit line

  • You could earn back your security deposit as a statement credit when you use your card responsibly, like making payments on time

  • Be automatically considered for a higher credit line in as little as 6 months with no additional deposit needed

  • Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges

  • Monitor your credit with CreditWise from Capital One. It's free for everyone and checking your credit does not hurt your credit score

Our pick for

No credit check or no bank account

Capital Bank Open Sky Secured Credit Card
Apply now

on Capital Bank's website

OpenSky® Secured Visa® Credit Card

4.6

NerdWallet rating 
Apply now

on Capital Bank's website

Annual fee

$35

Intro APR

N/A

Regular APR

17.39% Variable APR

Recommended Credit Score

You don't have to undergo a credit check to apply, and you don't need a bank account to qualify. If these are areas of concern for you, the OpenSky® Secured Visa® Credit Card is definitely worth a look. If not, there are better (and cheaper) alternatives.

Pros

  • The issuer doesn’t run a credit check on OpenSky® Secured Visa® Credit Card applicants, making this an attainable option for people with severely damaged credit. You can make your deposit — minimum $200, maximum $3,000 — and pay your bills with a debit card, wire transfer, check or money order, making it one of the few secured cards that doesn’t require a traditional bank account.

Cons

  • There's an annual fee of $35 — not excessive for a card for those with very poor credit, but not $0, either. You generally can’t upgrade your account to an unsecured card.

Read full review
  • No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.

  • The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.

  • Build credit quickly. OpenSky reports to all 3 major credit bureaus.

  • 99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.

  • We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search “OpenSky Card” in Facebook.)

  • OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.

  • *View our Cardholder Agreement located at the bottom of the application page for details of the card

Our pick for

No-deposit alternative

So-called "alternative credit cards" can also be a good option for those with no or poor credit. Such cards are typically from smaller companies and startups, and many of them do not require a security deposit at all. The issuers behind these cards can opt to use proprietary, nontraditional underwriting standards — such as income, employment and bank account balances — to evaluate the risk of lending to you.

Petal 1 "No Annual Fee" Visa® Credit Card
Apply now

on Petal's website

Petal® 1 "No Annual Fee" Visa® Credit Card

3.9

NerdWallet rating 
Apply now

on Petal's website

Annual fee

$0

Intro APR

N/A

Regular APR

19.99% - 29.49% Variable APR

Recommended Credit Score

The Petal® 1 "No Annual Fee" Visa® Credit Card requires no security deposit and, as its name suggests, has a $0 annual fee. Thanks to a unique underwriting process, it could be a good choice if you have less-than-ideal credit.

Pros

  • Petal’s algorithm allows its issuing bank — WebBank — to look beyond just credit scores. It can evaluate your bank information to get a clear picture of how you manage income, savings and spending. The card is light on fees, reports to all three credit bureaus, and even offers the chance at earning rewards.

Cons

  • You may be required to link your bank account in order to get this card, and the rewards it does earn are only with select merchants.

Read full review
  • $0 Annual Fee.

  • $500 - $5,000 credit limits.

  • Earn a credit limit increase in as little as 6 months. Terms and conditions apply.

  • No credit score? No problem. If eligible, we'll create your Cash Score instead.

  • 2% - 10% cash back at select merchants.

  • Variable APRs 19.99%-29.49%.

  • No annual or foreign transaction fees.

  • Build credit alongside tens of thousands of Petal Card members.

  • Petal's mobile app makes it easy to manage your money, track your spending, and automate payments.

  • See if you're pre-approved within minutes without impacting your credit score.

  • Petal reports to all 3 major credit bureaus.

  • No deposits required.

  • Card issued by WebBank, Member FDIC.

Our pick for

Rewards and upgrading

Capital One Quicksilver Secured Cash Rewards Credit Card
Apply now

on Capital One's website

Annual fee

$0

Intro APR

N/A

Regular APR

26.99% Variable APR

Recommended Credit Score

The Capital One Quicksilver Secured Cash Rewards Credit Card offers the ability to build or rebuild credit while also enjoying a simple, straightforward rewards rate.

Pros

  • The $0-annual-fee card earns 1.5% cash back on all purchases — a decent rate even among unsecured cards. It offers an automatic credit limit review after six months and a possible upgrade path to a traditional, unsecured card with Capital One.

Cons

  • As with all secured cards, an upfront deposit is required. The $200 minimum might be a tough hurdle for some to clear.

Read full review
  • No annual or hidden fees, and you can earn unlimited 1.5% cash back. See if you're approved in seconds

  • Building your credit? Using a card like this responsibly could help

  • Put down a refundable $200 security deposit to get a $200 initial credit line

  • You could earn back your security deposit as a statement credit when you use your card responsibly, like making payments on time

  • Be automatically considered for a higher credit line in as little as 6 months with no additional deposit needed

  • Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges

  • Monitor your credit with CreditWise from Capital One. It's free for everyone and checking your credit does not hurt your credit score

  • Earn unlimited 1.5% cash back on every purchase, everywhere. No rotating categories or limits to how much you can earn. It's that simple

Want to compare more options? Here are our other top picks:

Click the card name to read our review. Before applying, confirm details on the issuer’s website.

Our pick for: Rewards and upgrading

Like other secured credit cards for people building or rebuilding credit, the Discover it® Secured Credit Card requires a cash security deposit. Unlike most others, it offers rewards. But what really makes it stand out from the competition is its upgrade possibilities. The issuer has a process in place for automatically reviewing accounts for possible transition to an unsecured card. Read our review. 

Capital One Quicksilver Secured Cash Rewards Credit Card

Our pick for: Rewards and upgrading

The Capital One Quicksilver Secured Cash Rewards Credit Card offers an impressive combination of features for those with poor credit. A deposit is required, but in exchange you get a $0-annual-fee card that reports to all three credit bureaus; an automatic credit limit review after six months; and a possible upgrade path to an unsecured Capital One card. Oh, and 1.5% back on all purchases, which equals what you'd find on many unsecured cards. Read our review.

Our pick for: Low deposit

The Capital One Platinum Secured Credit Card requires a security deposit, as do all secured credit cards. But while most cards require you to put down a deposit equal to your credit line, this one allows some qualifying applicants to get a $200 credit line with a deposit of $49 or $99. Further, you can be automatically considered for a higher credit line with no additional deposit in as little as six months. Read our review.

Our pick for: Basic card for thin credit

The Citi® Secured Mastercard® is a straightforward card for people new to credit — put down a security deposit, use the card to establish a positive credit history and then move up to a better card (and get your deposit back). One note: This card is for people just starting out with credit, rather than people with bad credit from past mistakes. Read our review.

Our pick for: No credit check or no bank account

The OpenSky® Secured Visa® Credit Card charges an annual fee, but a lot of people will still want to take a look at it for two reasons. First, there's no credit check required. Second, you don't need a traditional bank account; you can fund the deposit or pay your bill with a money order or Western Union payment. Read our review.

Our pick for: No-deposit alternative

The issuer of the Petal® 1 "No Annual Fee" Visa® Credit Card doesn’t only rely on credit scores to determine eligibility. Instead, it assesses your creditworthiness based on your income, expenses, savings and debts. The card earns a decent rate of up to 10% cash back when you use the card to shop with select merchants. And there's no annual fee, late fees or foreign transaction fees. Read our review.

Our pick for: Adjustable credit limit

The Credit Builder Secured Visa® Credit Card from Armed Forces Bank makes it easy to increase your credit line over time to give you greater flexibility and keep your credit utilization low. You can increase your limit in $50 increments simply by depositing more money at any time. Read our review.

Our pick for: Military

The no-annual-fee Navy Federal Credit Union® nRewards® Secured Credit Card earns rewards, offers an upgrade path and even features some perks, which is a lot from a secured product — if you can swing the membership and security deposit requirements. Read our review.

Our pick for: Bikers ... or anyone seeking a $0 fee

No, you don't have to be a hardcore biker (or even a casual one) to benefit from the Harley-Davidson® Visa® Secured Card. It's a decent, no-annual-fee secured card for people looking to build or rebuild their credit. And if you are a biker, well, you can earn Harley-Davidson rewards, too. Read our review.

Our pick for: Low fees and interest

The DCU Visa® Platinum Secured Credit Card is a secured card for bad credit, but it offers a lower interest rate than many unsecured cards for people with good credit. You must be a member of Digital Federal Credit Union to get this card, although you can join by becoming a member of a partner organization for as little as $10. Read our review.

OTHER RESOURCES

Getting a secured credit card

Who can be approved?

Even though secured credit cards are available to people with bad credit, and even though the security deposit reduces the risk to the issuer, approval is not guaranteed for everyone:

  • The issuer will usually (but not always) check your credit report for signs that you're an unacceptable credit risk. If you're in the middle of a bankruptcy, for example, or you're currently delinquent on other accounts, or you've opened a bunch of new accounts recently, you're unlikely to be approved.

  • You'll also have to show that you have income so you can pay your credit card bill. Yes, the issuer has your deposit, but it will use that money to cover your bill only as a last resort. You're expected to pay your bill every month, so you'll need income.

How does the process work?

Every issuer handles things a bit differently, but the process of applying for, receiving and using a secured credit card works like this:

  1. You apply for the card. The issuer evaluates how risky you are (a process called underwriting), and if you pass muster, you're approved.

  2. You fund the deposit. Before the issuer will open your account, you have to pay your security deposit. In some cases, you must provide bank account information with your application so the deposit can be transferred right away. Other times, the issuer will give you some time to pull together the deposit. If you neglect to fund the deposit, the issuer will change the status of your application from approved to rejected.

  3. You receive the card. Once your deposit is funded, the issuer will send you your card. You can then use it just like any other credit card. In general, it's best to use less than 30% of your available credit at any given time, so don't go maxing out your secured card. Use it for a few small purchases each month and pay them off promptly.

  4. You get your bill and pay it each month. Because secured cards tend to charge very high interest rates, it's best to pay your bill in full every month to avoid finance charges. The issuer reports your payments to the credit bureaus, which helps you build credit.

  5. You upgrade. As your credit moves from bad to average to good, you'll be in a position to qualify for better cards:

  • Some issuers automatically review your account for potential upgrade to an unsecured card. For example, Discover does this with the Discover it® Secured Credit Card after eight months. Navy Federal Credit Union starts automatic reviews after six months when you have the Navy Federal Credit Union® nRewards® Secured Credit Card. When your issuer moves you to an unsecured card, you get your deposit back.

  • With other issuers, you may have to specifically request an upgrade. That might mean converting your secured account to unsecured or closing your secured card and opening a new unsecured account. Either way, you get your deposit back.

  • If your issuer can't or won't upgrade you — and keep in mind that not all secured-card issuers even offer unsecured cards — you can apply for unsecured cards separately. Eventually you'll want to close the secured card to recoup your deposit.

Alternatives to secured credit cards

Unsecured cards for bad credit

Several issuers specialize in unsecured credit cards for people with bad credit, but NerdWallet generally doesn't recommend them. That's because these "subprime specialist" cards tend to charge high fees that can easily add up to much more than a typical minimum security deposit — annual fees up to $99, application fees, "activation" and "processing" fees, monthly maintenance fees and so on. And unlike the deposit on a secured card, those fees are money you can't get back. Our roundup of the best and worst cards for bad credit has more information on cards to avoid.

Prepaid debit cards

Prepaid debit cards offer convenience and are a safer alternative than carrying cash, but they don't help you build credit. With a prepaid debit card, you "load" money onto the card, and the purchases you make are paid for with that money. Since you're not borrowing money, there's no effect on your credit score. See NerdWallet's best prepaid cards.

Credit-builder loans

Offered mostly by smaller financial institutions, such as credit unions and community banks, these loans are designed to help you build a good payment history. The money you "borrow" isn't actually given directly to you. Instead, it's held on your behalf in a savings account while you repay the loan in monthly installments. Once you're done, the money is released to you — and your credit report shows a paid-off loan. Learn more about credit-builder loans.

Personal loans

These loans can be secured or unsecured. Unsecured loans (those without collateral, such as a car title) generally have higher interest rates than secured loans. The better your credit, the lower your rate is likely to be. Conversely, those with bad credit can expect to pay very high rates, if they can get a loan at all. Learn more about personal loans.

Last updated on October 20, 2021

Methodology

NerdWallet's Credit Cards team selects the best secured credit cards based on overall value, as evidenced by star ratings, as well as suitability for specific kinds of consumers. Factors in our evaluation include annual and other fees, security deposits (both the minimum required and maximum allowed), APRs, whether a card offers an option to upgrade to an unsecured account, the availability of free credit scores and other credit education, reporting to credit bureaus, and other noteworthy features such as a rewards program or the ability to qualify without a credit check.

Frequently asked questions