Editorial Review

Discover it Secured Review: Earn Rewards as You Build Credit

It's nice to find a secured credit card with a $0 annual fee. Even better is one that offers a path to upgrade to a regular card. This one does both — and it gives you rewards, too.

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Our Take

5.0

NerdWallet rating 

The Bottom Line: When you consider the rewards, the lack of an annual fee and the opportunity for an upgrade, this is the best secured credit card we've seen.

Discover it® Secured

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

Rates & Fees
Annual Fee

$0

Regular APR

24.49% Variable APR

Intro APR

10.99% on Balance Transfers for 6 months

Recommended Credit Score

Quick FactsView rates and fees

Annual Fee
$0
Annual Fee
$0
Intro APR
10.99% on Balance Transfers for 6 months

Pros & Cons

Pros
  • No annual fee

  • Reports to the three major credit bureaus

  • Offers rewards and a sign-up bonus

  • Chance to upgrade to unsecured account after 8 months

Cons
  • Requires minimum deposit of $200

  • Discover cards not widely accepted outside the U.S.

Alternate Pick: No credit check

OpenSky® Secured Visa® Credit Card

Bad credit won't block your application

This card doesn't run a credit check on applicants, removing a major obstacle to getting approved. Additionally, you don't need a checking account; you can pay your deposit and your monthly bills with a money transfer or money order. One downside: There's an annual fee of $35.

Read our review

Compare to Other Cards

Annual Fee

$0

Annual Fee

$0

Annual Fee

$0

Regular APR

24.49% Variable APR

Rates & Fees

Regular APR

26.99% Variable APR

Regular APR

14.49% - 25.49% Variable APR

Intro APR

10.99% on Balance Transfers for 6 months

Intro APR

N/A

Intro APR

N/A

Recommended Credit Score
Recommended Credit Score
Recommended Credit Score

Full Review

The Discover it® Secured is the world-class sidekick you want when you lack a credit history or have bad credit. As a secured card, it far exceeds credit builders’ expectations in more ways than one.

Unlike most of its competitors, this card tells you when you might be able to graduate to a regular card and get your deposit back. Starting at eight months, Discover will review your account to determine whether you’re eligible for an upgrade. The card also features rewards — which are not generally offered on secured credit cards — and an annual fee of $0. It requires a security deposit of at least $200, but you can get that money back when you upgrade to a regular credit card or close the account in good standing.

Discover it® Secured: Basics

Card type: Secured.

Annual fee: $0.

Security deposit: A minimum of $200. This amount determines your credit limit. Deposits can be as high as $2,500.

Bonus: Discover will automatically match all the cash back you’ve earned at the end of your first year.

Rewards: Earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter. All other purchases earn 1%.

APR: 10.99% on Balance Transfers for 6 months, and then the ongoing APR of 24.49% Variable APR.

Foreign transaction fee: None.

Other perks:

  • Payments are reported to the three major credit bureaus (TransUnion, Equifax and Experian), which helps you build credit.

  • Discover reviews your account starting at eight months to see if you qualify for a regular credit card.

  • Discover doesn't charge a late fee on the first late payment.

  • The issuer's Credit Scorecard lets you track your credit score.

  • Free Social Security number alerts notify you when your information is found on the dark web.

  • An on-and-off switch, called Freeze it, allows you to block new purchases, cash advances or balance transfers from the issuer's online portal or app. This can come in handy if your card goes missing.

Why you might want the Discover it® Secured

More value in the form of rewards. It’s rare to find a secured credit card that offers rewards. With this card, you’ll earn 2% cash back on up to $1,000 in spending per quarter on gas and restaurant purchases, and an unlimited 1% back on all other purchases. You'll also receive a one-time bonus: Discover will automatically match all the cash back you’ve earned at the end of your first year. Rewards don’t expire, and there’s no minimum redemption amount. They can be redeemed through direct deposit to a bank account or as a statement credit to your account, among other options.

The chance to upgrade to a regular credit card. After you’ve held the card for eight months, the company will begin automatic monthly reviews to see whether you’re ready to move to an unsecured card and get your deposit returned. When you do transition to a regular card, you’ll keep the same account. Because opening a new account can lower your credit score in some instances, this is great for people who are excited to enter good credit territory.

An annual fee of $0. You're already required to pay a security deposit on a secured card, so it's best to avoid an annual fee, if you can help it. This card's annual fee of $0 is one less obstacle for would-be applicants.

Why you might want a different credit card

The minimum deposit is $200. Although the $200 minimum security deposit on the Discover it® Secured is relatively low, it can still be a barrier. In this regard, the $0-annual-fee Capital One® Secured Mastercard® could be a superior card. In some cases, you may be able to qualify for a minimum deposit of just $49 or $99 for a credit limit of $200 on this card.

Without a credit history, you can also consider the Petal Visa® Credit Card, which has no security deposit requirement. Petal's issuing bank can evaluate creditworthiness with an algorithm that analyzes your income, savings and spending. The card also earns up to 1.5% cash back with consistent on-time payments: It starts you off with 1% cash back on all purchases, but that goes up to 1.25% after six on-time payments and 1.5% after 12 on-time payments. It has an annual fee of $0.

It has a high ongoing APR. The interest on the Discover it® Secured is not very attractive: It comes with 10.99% on Balance Transfers for 6 months, and then the ongoing APR of 24.49% Variable APR. If you plan to carry a balance, you may be better off with the $0-annual-fee DCU Visa® Platinum Secured Credit Card, which has a much better APR. The ongoing APR is 13.75%, Variable — which is even lower than the rates on many unsecured cards. You'll need to qualify for membership at that credit union to be eligible for the card.

It requires a bank account. Because the security deposit for the Discover it® Secured has to be funded by a bank account, this card is not a viable solution for some people. Unbanked consumers may be better off with the OpenSky® Secured Visa® Credit Card, which offers alternative funding options, even though that card has an annual fee of $35.

Is the Discover it® Secured right for you?

If you’re committed to building or rebuilding credit, a secured card can be very helpful, especially a card like this one that has a smooth process to help you transition to an unsecured card when you’re ready. This card also gets high marks for paying such generous rewards and having an annual fee of $0.

Overall, unless you lack a bank account or can’t pay the $200 minimum deposit, the Discover it® Secured should definitely be on your short list of secured credit cards.

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