Deciding between a secured and unsecured credit card shouldn’t be hard.

Both secured and unsecured credit cards may have an annual fee.
Secured cards require a cash deposit, typically have lower credit limits and may be helpful in building or rebuilding credit.
Unsecured credit cards have stricter qualification requirements and may offer higher credit limits and better perks.

Here’s a look at the details that matter most, so you can make a decision quickly and confidently.

Secured vs. unsecured credit cards

	Secured Cards	Unsecured Credit Cards
Collateral Needed	Require a security deposit, usually equal to the credit limit.	No collateral or security deposit required.
Credit Limit	Limited by the amount of the security deposit.	Typically based on creditworthiness and income.
Eligibility	Easier to qualify for, as the security deposit mitigates risk.	Often require a good credit score and history for approval.
Interest Rates	May have higher interest rates compared to unsecured cards.	Interest rates may be lower than secured cards, especially for individuals with good credit.
Credit Building	Help build or rebuild credit with responsible use.	Contribute to credit history and score improvement.
Usage Restrictions	Some may have restrictions on certain purchases or activities.	Generally, no specific usage restrictions.

Examples of secured and unsecured credit cards

Secured credit cards

Neo Secured Credit

Annual Fee

$0
Interest Rates

19.99%-29.99% / 22.99%-31.99%

19.99%-29.99% on purchases, 22.99%-31.99% on cash advances.
Rewards Rate

0.5%-15%

Earn a 0.5% cash back guarantee, an average of 5% unlimited cash back at thousands of Neo partners, and up to 15% cash back on your first purchase at participating partners.
Intro Offer

$25

$25 new customer welcome offer fulfilled by Neo. Sign up using "Apply Now" link.

Apply Now

Neo Secured Credit is a no-fee card that earns cash back rewards and offers access to high-interest savings.

Pros

A small $50 minimum deposit makes this card accessible to consumers of all budgets.
Earn up to 15% cash back on purchases with select Neo partners.

Cons

Interest rates could be as high as 29.99% for some users.

Build credit history with on-time payments.
Set your credit limit and get started with as little as $50.
Guaranteed approval with no credit score needed to apply.
Earn 1% cashback on all gas and grocery purchases.
0.5% guaranteed monthly minimum cashback.
No monthly or annual fees.
Upgrade to Premium and earn exclusive benefits and boosted rewards, like 3% cashback on all gas and grocery and free credit monitoring.
Personalized Insights AI generates tailored information and recommendations designed specifically for you.

Home Trust Secured Visa Card

Annual Fee

$0 / $59

$0 annual fee with a 19.99% interest rate. $59 annual fee with a 14.90% interest rate.
Interest Rates

14.90% / 19.99%

14.90% on purchases, 19.80% on cash advances
Rewards Rate

N/A
Intro Offer

N/A

Apply Now

Why we like it

The Home Trust Secured Visa offers a straightforward, no-frills experience for credit builders. Plus, there are two secured credit card options to fit a variety of needs: a no-fee card, and a low-interest card with a $59 annual fee.

Pros

Low interest rate.
Payments are reported to both credit bureaus.

Cons

You’ll need to budget for the annual fee.
No ability to earn rewards on purchases.

$59 annual fee.
No fee option available with a higher interest rate.
$500 minimum security fund deposit required.
$10,000 maximum security fund deposit.
Hard credit checks are made on Home Trust Secured Visa applications.
Credit activity, including every payment, is reported to TransUnion and Equifax, the two major consumer credit bureaus in Canada.
Ability to upgrade to an unsecured credit card.
Manage your account and billing with online banking.
Cardholders can choose between a card with no annual fee and 19.99% interest or an annual fee of $59 and 14.90% interest.
Protection against fraud through Visa’s Zero Liability Policy.
Preferred rates: 14.90% for purchases, 19.80% for cash advances.
To be eligible, you must have a source of income and cannot currently be in bankruptcy. You must be able to provide security funds and be a Canadian resident of the age of majority in the province or territory where you live. The Home Trust Secured Visa Card is not available to Québec residents.

Unsecured credit cards

Scotiabank Value® Visa* Card

Annual Fee

$29

Offer ends October 31, 2024.

Waived first year
Interest Rates

12.99%

12.99% on purchases and cash advances.
Rewards Rate

N/A
Intro Offer

N/A

Apply Now

Why we like it

A rare 0% intro period on balance transfers and low interest rates year-round, the Scotiabank Value Visa can help you quickly pay down balances transferred from higher-rate credit cards.

Pros

Cardholders who carry a balance will save money every month with this card’s low 12.99% interest rate on purchases, cash advances and balance transfers.
A stellar 0% introductory interest rate on balance transfers for the first six months.

Cons

No rewards.
No insurance coverage.

0% introductory interest rate on Balance Transfers for the first 10 months (12.99% after that; annual fee $29).¹ Plus no annual fee in the first year.¹ Offer ends 31 Oct 2024.
Save up to hundreds of dollars a year on interest.
Low interest rate of 12.99%.
Pay down higher interest rate balances faster.
Transfer higher rate balances and save even more.
To be eligible, $12,000 (individual) annual income is required. Also, you must have a Canadian credit file and be a Canadian resident that is the age of majority in the province or territory where you live.
Terms and Conditions Apply. Click ‘Apply Now’ for complete details.

MBNA Rewards Platinum Plus® Mastercard®

Annual Fee

$0
Interest Rates

19.99% / 24.99%

19.99% on purchases, 24.99% on cash advances.
Rewards Rate

1x-4x Points

Earn 4 points†† for every $1 spent on eligible restaurant, grocery, digital media, membership and household utility purchases during the first 90 days, and 2 points‡ for every $1 spent on eligible purchases in those categories thereafter – in both cases, these earn rates apply until $10,000 is spent annually in the applicable category. 1 point‡ for every $1 spent on all other eligible purchases.
Intro Offer

Up to 10,000 Points

Earn 5,000 bonus points†† ($25 in cash back value) after you make $500 or more in eligible purchases within the first 90 days of your account opening. Earn 5,000 bonus points††($25 in cash back value) once enrolled for paperless e-statements within the first 90 days of account opening.

Apply Now

Why we like it

The MBNA Rewards Platinum Plus Mastercard offers bonus rewards on common spending categories, along with flexible options for redemption.

Pros

Flexible redemption options, including cash back, brand-name merchandise, gift cards, charitable donations and travel, and points never expire.
You can receive up to 10,000 Birthday Bonus Points every year.

Cons

Accelerated earn rate drops to 2x after the first 90 days, and 1x after $10,000 in spending. Considering how many categories fit into the cap, hitting the limit will be easy for families and big spenders.
Lack of travel insurance may disappoint some cardholders.

Earn 4 points†† for every $1 spent on eligible restaurant, grocery, digital media, membership and household utility purchases during the first 90 days, and 2 points‡ for every $1 spent on eligible purchases in those categories thereafter – in both cases, these earn rates apply until $10,000 is spent annually in the applicable category.
Earn 1 point‡ for every $1 spent on all other eligible purchases.
5,000 bonus points†† ($25 in cash back value) after you make $500 or more in eligible purchases within the first 90 days of your account opening.
5,000 bonus points††($25 in cash back value) once enrolled for paperless e-statements within the first 90 days of account opening.
Each year, you will receive Birthday Bonus Points‡ equal to 10% of the total number of Points earned in the 12 months before the month of your birthday, to a maximum Birthday Bonus each year of 10,000 Points.
Redeem points‡ for cash back, brand-name merchandise, gift cards from participating retailers, charitable donations, and travel.
Mobile Device Insurance*** With Mobile Device Insurance, you’ve got up to $1,000 in coverage for eligible mobile devices in the event of loss, theft, accidental damage or mechanical breakdown.
No annual fee.
‡, ††, ✪, ***, Terms and Conditions apply.
This offer is not available for residents of Quebec.
Sponsored advertising. MBNA is a division of The Toronto-Dominion Bank (TD) and TD is not responsible for the contents of this site including any editorials or reviews that may appear on this site. For complete information on this MBNA credit card, please click on the “Apply Now” button.

The type of credit card that’s best for you will depend on your financial situation and what you hope to accomplish with the card. If you have a low credit score, a secured card may be a better fit, as it will be easier to qualify for and, if used responsibly, will strengthen your credit profile over time. If you have a strong credit score, and are looking for a card that offers lots of perks and rewards, an unsecured credit card might be a better fit. Many people who start with a secured card eventually upgrade to an unsecured credit card at some point.

Secured cards require a cash deposit that often serves as your credit limit — which might be quite lower than an unsecured card. Secured cards may charge higher interest rates and offer fewer perks or rewards.

The speed at which you can positively impact your credit score is generally the same whether you’re using a secured or unsecured card. If you’re just starting to build or rebuild your credit history, it may be easier for you to qualify for a secured card.

Minimum security deposits for secured credit cards in Canada generally range from $200 to $500, but can be as low as $50.

Yes, some secured credit cards come with the ability to earn points and rewards, including cash back and retail discounts.

Canadian credit card issuers don’t commonly disclose the exact credit scores that are required to qualify for a card. However, a score that falls in the good to excellent credit score range is typically required for unsecured cards.

Many unsecured credit cards in Canada have annual income requirements. These can vary anywhere from $12,000 to $200,000 for individuals, but the most common requirement is $60,000 to $80,000. In general, cards with the most benefits and lucrative rewards have higher income requirements.