Not everyone can be approved for a rewards credit card. If you have a limited credit history — or have made some credit mistakes in the past and have a bad or poor credit score — you may want to use a secured credit card while you work to improve your credit. Here are some of the best available options.
The Capital One Platinum Secured Credit Card is one of the few secured credit cards that may extend you a credit line that is greater than your security deposit. The card can be a good choice for people looking for a secured card since it includes no foreign transaction fees, auto rental collision damage insurance, travel accident insurance and extended warranty protection. It also comes with CreditWise, which gives you alerts when your TransUnion or Experian credit report changes.
- 5% Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options. Terms apply
- 1.5% Earn unlimited 1.5% cash back on every purchase, everywhere
The Capital One Quicksilver card is a great option for new cardholders looking for a flat cash back rate. The Quicksilver card earns unlimited 1.5% cash back on all purchases and has no annual fee. Unfortunately, the secured version of the Quicksilver card does not offer a sign-up bonus. In addition, cardmembers can enjoy unlimited 5% cash back on hotels and rental cars booked through Capital One Travel. It is a great card if you are looking for a simple way to earn cash back on all purchases, but it does not offer many additional perks or bonus earnings.
The OpenSky Secured Visa Credit Card comes with a $35 annual fee but is a great option for cardholders with a poor credit history. The Opensky Secured card tours a high approval rate, even for people without a bank account. In addition, the card does not require a credit check and cardholders are routinely considered for an increased credit line after six months.
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|Card||Best for||Welcome Offer/Sign Up Bonus||Earning Rate||Annual Fee|
|Capital One Platinum Secured Credit Card||Best for credit card perks||N/A||N/A||$0|
|Capital One Quicksilver Secured Cash Rewards Credit Card||Best for flat-rate earning||N/A||
|OpenSky® Secured Visa® Credit Card||Best for poor credit history||N/A||N/A||$35|
What is a secured credit card?
A secured credit card is a card that requires a security deposit from the cardholder when the account is opened. This security deposit is usually refundable and determines your initial credit limit. Secured credit cards are often used by consumers without credit history or with low credit scores and can be useful for building or repairing credit.
How we chose the best secured credit cards
In choosing the best secured credit cards for this guide, we prioritized cards that don’t charge an annual fee and report credit activity to the three main credit bureaus. Reporting activity to credit bureaus is important since you’ll want your activity on the card to help improve your credit score. We also included some cards with modest annual fees with unique perks or aspects that may make them the best option for some consumers.
We didn’t put much weight on the APR rate, as you’ll want to ensure you can pay off your balance each month to work on building or repairing your credit. And, although this article is on The Points Guy, you shouldn’t put too much weight on the rewards earning rate since you’ll generally only keep your secured card until you’ve built or repaired your credit enough to move to a rewards credit card.
Should I get a secured credit card?
Secured credit cards are best used for building or repairing credit. If you don’t have strong enough credit to be approved for most beginner credit cards, and you don’t have any trusted friends or family members that are willing to add you to their account as an authorized user, a secured credit card can be an assured way to getting a credit card and working to improve your credit score.
You should see a secured credit card as a stepping stone to an unsecured (or traditional) rewards credit card. If you can already get approved for an unsecured rewards credit card that doesn’t have high fees, you won’t need to consider getting a secured credit card.
How does a secured credit card help build or repair credit?
If you’re looking to build or repair your credit with a secured credit card, you’ll want to ensure the card you get will report your payment activity to the credit bureaus. All of the cards described in this guide advertise that they do so — after all, card issuers realize that most people using secured credit cards are working to build or repair credit.
With a secured credit card, you’ll generally start with a low credit line. So, to build or repair your credit, you’ll initially want to make small, infrequent purchases and focus on paying off your balance in full each month.
The issuer may eventually offer you a higher credit line, which can help your credit score as long as you keep your utilization low. It’s also a good idea to check your credit score regularly while working to build or repair your credit.
Related: The best first credit cards
Is it worth it to pay an annual fee on a secured credit card?
Generally, it’s not worth paying an annual fee on a secured credit card. However, if you don’t want the issuer to perform a credit check, you may need to pay an annual fee to access a secured credit card that offers no credit check, like the OpenSky Secured Visa. And, although you should be paying your credit card bill in full every month to improve your credit score, if you are looking for a secured credit card with a low APR, you’ll usually need to pay an annual fee.
Related: Guide to credit card annual fees