This consumer-friendly card keeps costs low. But be advised that you have to join the issuing credit union to be eligible to apply, and the security deposit is hefty.
Pros & Cons
No annual fee
Reports to the three major credit bureaus
Qualify with limited/bad credit
No foreign transaction fees
Must be a member/customer
Requires minimum deposit
People with badly damaged credit can be rejected even for secured cards because they can't pass a credit check. It's also hard to get a credit card if you don't have a traditional bank account. This card removes those obstacles. It has no rewards and charges an annual fee of $35, but it's a legitimate option for those who don't have many.
Compare to Other Cards
23.24% Variable APR
17.64% Variable APR
10.99% intro APR on Balance Transfers for 6 months
Recommended Credit Score
Recommended Credit Score
Recommended Credit Score
Make no mistake. DCU, which offers the DCU Visa® Platinum Secured Credit Card, is one of the good guys in the secured-card industry, which has its share of predators. This DCU card has a number of consumer-friendly features that are laudable for a secured card — notably low interest rates and a dearth of fees, including an annual fee of $0.
But the card’s luster is dulled by the hassle of joining a credit union in order to apply, coupled with no chance of earning spending rewards. More importantly, it has an exceptionally high required deposit compared with top competitors. That puts the card out of reach for paycheck-to-paycheck consumers looking to build or rebuild credit with a secured card. In short, the card is good for a segment of secured-card shoppers: those with ailing credit but healthy cash flow.
DCU Visa® Platinum Secured Credit Card: Basics
Card type: Secured.
Annual fee: $0.
Interest rate: The ongoing APR is 11.75% Variable.
Required deposit: $500.
DCU encourages cardholders to contact them after a year to talk about getting an unsecured card. Factors for approval include credit score, income and payment history.
Foreign transaction fees: None.
Cash advance fees: None.
Balance transfer fees: None.
Why you might want the DCU Visa® Platinum Secured Credit Card
Cards for people with bad credit are notorious for high fees: annual fees, monthly fees, processing fees, application fees, the list goes on. The DCU Visa® Platinum Secured Credit Card eliminates just about all of them, including ones that are standard on most cards. Beyond the $0 annual fee, the card imposes no fee for purchases outside the U.S., while many other cards charge 3%. Even cash advances are fee-free, and you don't pay a higher interest rate on advances. (Many cards charge a fee and impose a higher rate.) You must put down a hefty refundable security deposit when you open the account. But beyond that, the card costs very little.
Low interest rate
The ongoing APR is 11.75% Variable. That's around 10 percentage points lower than the rates people with poor credit would typically be offered, and it's lower even than rates on many cards for people with good credit. In general, it's best not to carry a balance on a credit card from month to month. If you pay in full, you don't have to worry about interest, and keeping balances low is good for your credit score. But if you have to carry debt, it won't cost as much with this card as it would with many others.
No limit to your credit line
As a secured card, the DCU Visa® Platinum Secured Credit Card requires a collateral deposit equal to your credit line. But the DCU Visa® Platinum Secured Credit Card doesn't put a cap on how high that credit line can be. As long as you have enough cash held with the credit union to cover it in case you default, you can have all the spending flexibility you need.
The purpose of a secured card is to help you rebuild your credit. That can't happen if the card issuer doesn't report your card activity to the companies that compile credit reports, the basis for credit scores. Some small, local banks may report to only one or two of the three major credit bureaus, or none at all. The DCU Visa® Platinum Secured Credit Card reports to all three major bureaus, making it easier for you to get back on track to building good credit. You also get free access to your FICO credit score, so you can track your progress.
Why you might want a different card
Security deposit required
The security deposit required to open any secured card account is a barrier for some people. It often requires coming up with hundreds of dollars and tying up that money for as long as the account is open. If you want a high credit line, you have to put up a deposit to match.
The DCU Visa® Platinum Secured Credit Card requires a whopping $500 security deposit, far more than any other card that NerdWallet recommends. Many of them require just $200. That puts this card out of reach for some people who simply can’t come up with $500 or can’t afford to lose use of that much cash.
Your deposit at DCU does earn a little interest while it’s unavailable to you. But in our view, a secured card should be judged on how well it helps you improve your credit so you can ditch it and get approved for a regular unsecured credit card, along with other benefits of having decent credit. A high deposit requirement is a problem because it makes the card too expensive for too many people. (An exception to this criticism is a specific subset of potential applicants: those who have plenty of cashflow but thin or damaged credit. For them, the card shines.)
By contrast, a different card, the Capital One Platinum Secured Credit Card, requires a far lower security deposit. You may be able to qualify to pony up a deposit less than your credit line. A $200 initial credit line can be had for a deposit of $49, $99 or $200. The issuer allows you to pay your deposit in installments. And if you make your monthly payments on time, you could gain access to a higher credit line with no additional deposit required in as little as six months. That’s the kind of flexibility needed by people watching their nickels.
Credit union membership required
With most credit cards, you don't need to have an account with the issuer's retail bank to be approved. Not so with the DCU Visa® Platinum Secured Credit Card. You must be a member of the Massachusetts-based Digital Federal Credit Union. There are several paths to membership:
You work for or are retired from a participating employer.
You live, work, worship or attend school in a community that has been designated as underserved, and the credit union has a branch in it.
You are related to a current member.
You belong to a participating organization based in Massachusetts. This is the easiest way in for people outside the credit union's service area. For membership fees as low as $10, you can join participating organizations, which include environmental and educational nonprofits and other groups.
Because membership criteria are loose, this requirement may not be a big deal. And more broadly, there are plenty of reasons to love consumer-friendly credit unions. Still, it's another hoop to jump through when applying for the secured card.
If you're struggling with bad credit, rewards aren't as important as building good credit. Still, it's nice to get a little something back for your spending. The Discover it® Secured Credit Card requires a minimum deposit of $200, and it earns 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter. All other purchases earn 1% cash back. The annual fee is $0.
Explore other options across all credit card categories at NerdWallet's best credit cards page.
Is the DCU Visa® Platinum Secured Credit Card right for you?
The DCU Visa® Platinum Secured Credit Card ticks some important boxes, with its low fees, low interest and flexibility. But its unusual requirements — a high deposit and credit union membership — will be a deal-breaker for some. Still, if you're building credit and have the upfront cash, this card has allure.
NerdWallet reviews credit cards with an eye toward both the quantitative and qualitative features of a card. Quantitative features are those that boil down to dollars and cents, such as fees, interest rates, rewards (including earning rates and redemption values) and the cash value of benefits and perks. Qualitative factors are those that affect how easy or difficult it is for a typical cardholder to get good value from the card. They include such things as the ease of application, simplicity of the rewards structure, the likelihood of using certain features, and whether a card is well-suited to everyday use or is best reserved for specific purchases. Our star ratings serve as a general gauge of how each card compares with others in its class, but star ratings are intended to be just one consideration when a consumer is choosing a credit card. Learn how NerdWallet rates credit cards.