BEST OF
Best Secured Credit Cards of January 2021
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.
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.
Best Secured Credit Cards From Our Partners
Our pick for
Rewards and upgrading
Annual Fee
$0
Regular APR
22.99% Variable APR
Intro APR
10.99% intro APR on Balance Transfers for 6 months
Rec Credit Score
300-629
Poor
- No Annual Fee, earn cash back, and build your credit with responsible use.
- Using your secured card will build a credit history with the three major credit bureaus. Generally, prepaid and debit cards can’t do that.
- Establish your credit line 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 and Fees
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.
Why We Like It
When you consider the rewards, the lack of an annual fee and the opportunity for an upgrade, the Discover it® Secured is the best secured credit card we've seen.
Our pick for
No credit check or no bank account
Annual Fee
$35
Regular APR
17.39% Variable APR
Intro APR
N/A
Rec Credit Score
300-689
Poor - Average
- 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
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.
Why We Like It
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.
Our pick for
No hard credit inquiry
Annual Fee
$29
Regular APR
19.99% Variable
Intro APR
N/A
Rec Credit Score
300-629
Poor
- Receive Your Card More Quickly with New Expedited Processing Option
- No Credit History or Minimum Credit Score Required for Approval
- Quick and Complete Online Application
- Full-Feature Platinum Mastercard® Secured Credit Card
- Good for Car Rental, Hotels; Anywhere Credit Cards Are Accepted!
- Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
- Credit Line Secured by Your Fully-Refundable Deposit of $200 -- $2,000 Submitted with Application
- Just Pay Off Your Balance and Receive Your Deposit Back at Any Time
- 24/7 Online Access to Your Account
- You must be a resident of a US state; however, at present the program is not available in Arkansas, Iowa, New York, or Wisconsin *See Card Terms.
- Apply in just a few moments with no negative impact to your credit score; no credit inquiry will be recorded in your credit bureau file
Pros
Getting a secured card without a hard inquiry on your credit report can be a benefit to those with lower credit scores, when every point counts. The interest rate on this card is decent for a secured card, though it's best to pay your balance in full every month, especially when building credit.
Cons
The annual fee of $29 isn't terrible — but there are good secured cards available with no annual fee at all.
Why We Like It
First Progress checks your credit when you apply for one of its secured cards, but it's not a "hard" inquiry, meaning it doesn't affect your credit score. The First Progress Platinum Elite Mastercard® Secured Credit Card gets the nod here as the lowest-cost First Progress card.
Our pick for
Lowest interest rate
Annual Fee
$49
Regular APR
9.99% Variable
Intro APR
N/A
Rec Credit Score
300-629
Poor
- Receive Your Card More Quickly with New Expedited Processing Option
- No Credit History or Minimum Credit Score Required for Approval
- Quick and Complete Online Application
- Full-Feature Platinum Mastercard® Secured Credit Card
- Good for Car Rental, Hotels; Anywhere Credit Cards Are Accepted!
- Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
- Credit Line Secured by Your Fully-Refundable Deposit of $200 -- $2,000 Submitted with Application
- Just Pay Off Your Balance and Receive Your Deposit Back at Any Time
- 24/7 Online Access to Your Account
- You must be a resident of a US state; however, at present the program is not available in Arkansas, Iowa, New York, or Wisconsin *See Card Terms.
- Apply in just a few moments with no negative impact to your credit score; no credit inquiry will be recorded in your credit bureau file
Pros
Credit cards for people with bad credit tend to have very high interest rates — often 25% or more. The First Progress Platinum Prestige Mastercard® Secured Credit Card, however, offers a rate lower than what you'll find on many products for people with good or excellent credit. You can apply with no hard credit inquiry, a benefit to people with lower scores, where every point counts.
Cons
The annual fee of $49 is on the high side for secured cards. (For a lower fee but a higher APR, consider the First Progress Platinum Elite Mastercard® Secured Credit Card.)
Why We Like It
Although it's always best to pay your credit card in full each month, especially when you're trying to build credit, the low interest rate on the First Progress Platinum Prestige Mastercard® Secured Credit Card takes a much smaller bite when you do carry a balance.
Our pick for
Low deposit
Annual Fee
$0
Regular APR
26.99% Variable APR
Intro APR
N/A
Rec Credit Score
300-629
Poor
- No annual fee
- Unlike a prepaid card, there is regular reporting to the 3 major credit bureaus
- Accepted at millions of locations worldwide
- Make the minimum required security deposit and you'll get an initial credit line of $200. Plus, deposit more money before your account opens to get a higher credit line
- Access to an authorized bank account is required to make your $49, $99 or $200 refundable security deposit
- Be automatically considered for a higher credit line in as little as 6 months with no additional deposit needed
- We will monitor your account, and as you use it responsibly by doing things like making on-time payments, you may be able to earn back your deposit as a statement credit
- Easily manage your account 24/7 with online access, by phone or using our mobile app
Pros
With most secured cards, your deposit must be equal to your credit limit. But with the Secured Mastercard® from Capital One, 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.
Why We Like It
The Secured Mastercard® from Capital One 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.
Our pick for
Basic card for thin credit
Annual Fee
$0
Regular APR
22.49% Variable APR
Intro APR
N/A
Rec Credit Score
630-689
Average
- The Citi® Secured Mastercard® is a no annual fee credit card that helps you build your credit when used responsibly.
- Unlike a debit card, it helps build your credit history with monthly reporting to all 3 major credit bureaus. Once available, you will also have free access to your FICO score online.
- Use your card anywhere Mastercard® is accepted - worldwide.
- A security deposit is required. Once approved, your credit limit will be equal to your security deposit (minimum of $200).
- Get help staying on track with Auto Pay and account alerts.
- With Flexible Payment Due Dates, you can choose any available due date in the beginning, middle or end of the month.
- Manage your account 24/7 online, by phone, or in our mobile app.
- The standard variable APR for Citi Flex Plan is 22.49%. Citi Flex Plan offers are made available at Citi's discretion.
Pros
With an annual fee of $0 and a minimum deposit of $200, this is a low-cost, low-maintenance, no-fuss option for someone looking to build credit. When your credit improves, you may be able to graduate to one of the issuer's regular cards.
Cons
The Citi® Secured Mastercard® is not a card for people with damaged or "bad" credit. It's for people building credit for the first time rather than rebuilding credit after past mistakes.
Why We Like It
The Citi® Secured Mastercard® is a low-hassle card: Get it, use it to build credit, then move up to a product with better terms.
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 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.
Our pick for: Low deposit
The Secured Mastercard® from Capital One 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 hard credit inquiry
Although the issuer will check your credit when you apply for the First Progress Platinum Elite Mastercard® Secured Credit Card, it's not a "hard" credit inquiry, so it doesn't affect your credit score. That can be a benefit when every point counts. Read our review.
Our pick for: Lowest interest rate
Although it's always best to pay your credit card in full each month, especially when you're trying to build credit, the low interest rate on the First Progress Platinum Prestige Mastercard® Secured Credit Card takes a much smaller bite when you do carry a balance. The downside: A substantial annual fee. 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:
You apply for the card. The issuer evaluates how risky you are (a process called underwriting), and if you pass muster, you're approved.
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.
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.
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.
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 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 January 4, 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
Secured credit cards require a cash security deposit, while regular "unsecured" cards do not. The card issuer requires that you deposit some money — typically $200 or more — to open your secured card account. The deposit is there to protect the issuer in case you don't pay your bill. Because secured credit cards pose less risk to the issuer, they are generally easier to qualify for.
Secured credit cards usually require you to deposit at least $200 to $300, although some have minimum requirements as high as $500. See the chart of deposit requirements above.
No. A secured credit card is different from a prepaid debit card that you "load" with money. With prepid debit, you put money on the card, and then you spend that money when you make purchases. A secured card works just like a regular credit card: You make purchases with the card, and then you pay them off later. The deposit comes into play only if you don't make your payments. In that case, the issuer can use it to pay your debt.
In most cases, your credit limit will be equal to your security deposit. So if you deposit $300, you'll have a $300 credit limit on your card. If you deposit $1,000, you'll have a $1,000 limit, and so on. Most cards set a maximum amount you can deposit — say, $2,500 or $5,000 — which also limits your credit line.
It depends on the card. With some cards, you can increase your credit limit just by depositing more money. With others, you must apply for an increase. Some cards will automatically consider you for a credit line increase if you use the card responsibly for a while — not going over your limit and paying your bill on time every month. Also depending on the card, you might be able to get a higher credit line without depositing more money.
Yes, when you close your account in good standing (meaning you've paid off your balance) or when you upgrade to an unsecured card from the same issuer, your security deposit will be returned to you.
It depends on the card. There are excellent options that don't charge an annual fee, including several on this page. If you want a card that won't require a credit check or that charges an extra-low interest rate, you're more likely to pay an annual fee. In general, you shouldn't pay more than $50 a year for a secured card.
Secured credit card interest rates tend to be high — often well over 20% APR — although there are exceptions. Credit card issuers set interest rates according to risk: The higher the risk, the higher the rate. Since secured cards are designed for people building or rebuilding credit, they usually charge higher rates than "regular" cards. Keep in mind that if you don't carry a balance from month to month — that is, if you pay your balance in full every time — then your interest rate doesn't really matter because you don't get charged interest.
No. Even though the risk is lower, issuers of secured cards still have eligibility criteria. For example, you'll need to be able to pay your bill each month, so your application could be rejected if you don't have a job or if you have only a small income. If you have filed for bankruptcy and the case is still pending (meaning a court could wipe out any debt you put on a new card), you could be rejected. Some secured cards are designed only for people new to credit, rather than those with bad credit, so you could be rejected based on negative information on your credit report.
Use it to build your credit! Make small purchases with it regularly, and then pay those purchases off in full every month to avoid paying interest. Don't max out the card — in fact, strive to keep your balance below 30% of your limit. Ideally, you won't have this card forever. It's a tool you use to demonstrate to lenders that you can handle credit responsibly. As you build a solid payment history and your credit improves, you can start looking at cards with better benefits.
Yes, but be careful. Several specialist companies offer unsecured credit cards designed for people with bad credit, but we generally advise consumers to be cautious when applying for them. They tend to charge high fees that secured cards do not — application or "processing" fees at the beginning, annual fees as high as $99, monthly maintenance fees, and so on. And unlike a secured card deposit, none of these fees are refundable.
