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Over 45 million Americans have no credit score or insufficient credit history. If you’re starting from zero, a secured credit card is the fastest way to build credit—but they work differently than regular cards.

This guide explains everything: how secured cards work, real costs, approval process, and the 6 best secured cards in 2025.

What Is a Secured Credit Card?

A secured credit card requires a refundable security deposit that becomes your credit line. The deposit protects the card issuer if you don’t pay your bill.

Simple example:

• You deposit $300
• You get a credit card with $300 limit
• You use it and pay monthly (just like any credit card)
• After 6-12 months of on-time payments, you can upgrade to unsecured card
• You get your $300 deposit back

The deposit is not a payment. It sits in a savings account and you get it back when you close the card or graduate to unsecured.

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How Secured Cards Build Credit

Reports to All 3 Credit Bureaus

Secured cards report to Experian, Equifax, and TransUnion exactly like regular credit cards. There’s no notation that says “secured” on your credit report.

This means:

• Payment history builds your score
• On-time payments increase your credit
• Late payments damage your credit
• Credit utilization affects your score

Timeline to Build Credit

Month 1: Deposit clears, card activated, no score yet
Month 2-3: Credit bureaus receive first reports
Month 4-6: Credit score appears (usually 600-650 range)
Month 7-12: Score improves to 680-720 with perfect payments
Month 12+: Eligible for unsecured cards and graduation

Real data: According to Experian, people with secured cards see average score increases of 35-40 points within 6 months of responsible use.

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Secured vs. Unsecured Credit Cards

Feature	Secured Card	Unsecured Card
Deposit Required	Yes ($49-$5,000)	No
Approval	Easy (no credit needed)	Requires credit history
Credit Building	Yes (same as unsecured)	Yes
Reports to Bureaus	Yes (all 3)	Yes (all 3)
Can Graduate	Yes (6-18 months)	N/A
Get Deposit Back	Yes (when graduate/close)	N/A
Annual Fees	$0-$49	$0-$99+

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6 Best Secured Credit Cards (2025)

1. Discover it® Secured – Best Overall

Why it’s #1: Only secured card with cashback rewards

Key Details:

• Deposit: $200 minimum (up to $2,500)
• Annual Fee: $0
• Rewards: 2% cashback at gas/restaurants (up to $1k/quarter), 1% everything else
• Cashback Match: Discover matches all cashback first year (effectively 4% gas/restaurants, 2% everything)
• Graduation: Automatic review after 8 months
• Credit Score Tracking: Free FICO score monthly

Real Costs:

• Year 1: $0 in fees + earn ~$50-150 in cashback
• Deposit returned after graduation

Approval Rate: ~85% of applicants with no credit approved (based on user reports)

Apply for Discover it Secured →

Pro tip: Use for gas and dining to maximize 2% cashback. $50/month spend = $12/year cashback + $12 match = $24 free money.

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Capital One Platinum vs Discover it Secured

2. Capital One Platinum Secured – Lowest Deposit

Why choose this: Start with just $49 deposit

Key Details:

• Deposit: $49, $99, or $200 (determines starting limit)
• Annual Fee: $0
• Rewards: None
• Graduation: Possible after 6 months, automatic reviews
• Credit Line Increases: Possible without additional deposit after 6 months

Real Costs:

• Year 1: $0 in fees
• Can start with as little as $49

Unique Feature: Capital One may increase your credit limit without requiring additional deposit after 6 months of good payment history.

Example: Start with $200 limit, after 6 months get increased to $500 limit without adding $300 more deposit.

Apply for Capital One Platinum Secured →

Best for: People who can’t afford $200+ deposit immediately.

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3. Citi® Secured Mastercard® – Fastest Graduation

Why choose this: Can graduate in as little as 7 months

Key Details:

• Deposit: $200-$2,500
• Annual Fee: $0
• Rewards: None
• Graduation: Automatic reviews starting at 7 months
• Credit Line Increases: After 18 months with good history

Real Costs:

• Year 1: $0 in fees
• Faster path to unsecured card

What makes it special: Citi has the shortest timeline for graduation reviews. Most users report graduation within 8-10 months.

Apply for Citi Secured Mastercard →

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4. Bank of America® Customized Cash Rewards Secured – Best Rewards Flexibility

Why choose this: Choose your 3% cashback category

Key Details:

• Deposit: $200-$5,000
• Annual Fee: $0
• Rewards:
  • 3% category of choice (gas, online shopping, dining, travel, drugstores, home improvement)
  • 2% at grocery stores and wholesale clubs (up to $2,500/quarter combined)
  • 1% everything else
• Graduation: Typically 12-24 months
• Extra Perk: 10% relationship bonus if you have BofA checking/savings (3.3% becomes 3.3%, etc.)

Real Costs:

• Year 1: $0 fees + earn $50-200 in cashback

Strategy: Choose “online shopping” as 3% category to maximize everyday purchases (Amazon, etc.)

Apply with Bank of America →

Best for: Existing Bank of America customers (easier approval).

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5. OpenSky® Secured Visa® – No Credit Check

Why choose this: Guaranteed approval, no credit check at all

Key Details:

• Deposit: $200-$3,000
• Annual Fee: $35
• Rewards: None
• No Credit Check: Guaranteed approval with deposit
• Reports to: All 3 credit bureaus
• Graduation: Does not graduate (you must apply for unsecured card elsewhere)

Real Costs:

• Year 1: $35 annual fee
• Year 2: $35 annual fee

The trade-off: You pay $35/year for guaranteed approval and no credit check. Worth it if you’ve been denied everywhere else.

Apply for OpenSky Secured →

Best for: People denied by other issuers, or those who want to avoid hard inquiry.

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6. Chime Credit Builder – No Interest Ever

Why it’s different: Works like debit card, reports as credit card

Key Details:

• Deposit: Uses your Chime spending account balance
• Annual Fee: $0
• Interest: 0% (you can’t carry a balance)
• How it works: Purchases pull from secured account, paid off automatically
• Rewards: None (but optional “round-up” savings feature)

Real Costs:

• Year 1: $0 fees, $0 interest (impossible to pay interest)

How Chime Credit Builder works:

1. Open free Chime checking account
2. Transfer money to Credit Builder secured account
3. Use card for purchases
4. Purchases pull from secured balance automatically
5. Reports as on-time payment to credit bureaus
6. You literally cannot go into debt or pay interest

Example: You put $500 in Credit Builder. Buy $50 groceries. Balance drops to $450. Next month, it reports as “$50 paid on time” to credit bureaus.

Get Chime Credit Builder →

Chime Bank Review

Best for: People who want zero risk of debt or interest charges.

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How to Choose Your Secured Card

Choose Discover it Secured if:

• You have $200+ for deposit
• Want to earn cashback while building credit
• Want best overall value

Choose Capital One Platinum if:

• You only have $49-$99 available
• Need lowest entry barrier
• Want potential for credit increases without more deposit

Choose Citi Secured if:

• Want fastest path to graduation
• Have $200+ for deposit
• Don’t need rewards

Choose Bank of America Secured if:

• You’re already a BofA customer
• Want customizable cashback categories
• Have $200+ for deposit

Choose OpenSky if:

• You’ve been denied everywhere
• Want to avoid credit check
• Don’t mind $35/year fee

Choose Chime Credit Builder if:

• You want zero interest charges
• Like automatic payment feature
• Want guaranteed no-debt option

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Step-by-Step: Getting a Secured Card

Before You Apply

1. Check your budget:

• Can you afford $200-$300 deposit?
• This money is locked up for 6-12 months
• You’ll get it back, but can’t access it meanwhile

2. Gather required documents:

• Government-issued ID
• Social Security Number or ITIN
• Proof of income (paystub, tax return, bank statements)
• US address (can’t use P.O. Box for most cards)

3. Open a bank account (if you don’t have one):

• Required for security deposit
• Shows financial stability
• Needed for automatic payments

Application Process

Step 1: Choose your card based on criteria above

Step 2: Apply online (takes 5-10 minutes):

• Personal information
• Income (list all sources: job, self-employment, benefits, allowances)
• Housing costs
• Employment information

Step 3: Get decision:

• Instant approval: Most common for secured cards (70%+ of applicants)
• Pending review: 7-10 business days
• Denial: Rare for secured cards; usually due to recent bankruptcy or identity issues

Step 4: Make deposit:

• Usually within 14 days of approval
• Via bank transfer or check
• Card ships after deposit clears (7-10 days)

After Approval: First 6 Months

Month 1-2: Establish Patterns

• Activate card immediately
• Make 1-3 small purchases ($10-30)
• Pay statement balance in full before due date
• Set up autopay for at least minimum payment

Month 3-4: Increase Usage

• Use for regular expenses (gas, groceries, subscriptions)
• Keep utilization under 30% of limit
• Continue paying in full
• Check credit score (if card provides free monitoring)

Month 5-6: Build Consistency

• Maintain regular usage pattern
• Never miss payment
• Keep utilization low (ideally under 10%)
• Consider requesting credit line increase (if available)

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How to Graduate to Unsecured Card

Automatic Graduation (Best Scenario)

Discover it Secured:

• Automatic review after 8 months
• If you’ve paid on time every month, they’ll upgrade
• Deposit refunded, same account number
• Usually happens at month 8-10

Capital One Platinum:

• Automatic reviews starting at 6 months
• May increase limit without deposit first
• Full graduation typically 12-18 months
• Deposit refunded when graduated

Citi Secured:

• Automatic reviews starting at 7 months
• Fastest graduation of major issuers
• Deposit refunded upon upgrade

Manual Request

If your card doesn’t auto-graduate:

After 12 months of perfect history:

1. Call card issuer customer service
2. Request “product change to unsecured card”
3. Reference your perfect payment history
4. Ask about their graduation criteria

Success rate: ~70% if you have 12+ months of on-time payments and utilization under 30%

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Common Questions & Mistakes

Can I add more to my deposit later?

Yes, with most cards. Additional deposits usually increase your credit limit dollar-for-dollar.

Example: Start with $200 limit, deposit another $300, now have $500 limit.

Will it show as “secured” on my credit report?

No. Credit reports show it as a regular credit card. Employers, landlords, lenders can’t tell it’s secured.

What happens if I miss a payment?

Immediate consequences:

• Late fee ($25-$40)
• Potential interest rate increase
• Credit score drops (90-110 points for first missed payment)

Your deposit is not used unless you completely default and stop paying for months.

Can I get my deposit back early?

Usually no, unless:

• You close the account (hurts your credit)
• You upgrade to unsecured card (best option)
• Card issuer offers it (rare)

How much should I use the card?

Ideal usage: 1-10% of your credit limit per month

Example with $500 limit:

• Perfect: $20-50/month ($240-600/year)
• Good: $50-150/month
• Risky: $150-$450/month (high utilization hurts score)
• Bad: $450-$500/month (maxed out card tanks score)

Common Mistake #1: Not Using the Card

Bad: Getting card and never using it won’t build credit effectively.

Good: Make at least 1 purchase per month, even if just $5-10.

Common Mistake #2: Carrying a Balance

Myth: “I need to carry a balance to build credit.”

Reality: Pay in full every month. You don’t need to pay interest to build credit. Just use the card and pay it off.

Common Mistake #3: Closing Card After Graduation

Bad: Getting unsecured card and immediately closing secured card.

Good: Keep first card open. Length of credit history matters (15% of credit score). Keep it open even if you stop using it.

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Building Credit: The Numbers

Credit Score Factors

Payment History (35%) – Most important

• Pay on time = +5-10 points/month
• Miss payment = -90-110 points immediately

Credit Utilization (30%) – Second most important

• Under 10% = Best for score
• 10-30% = Good
• 30-50% = Fair (score impact)
• 50%+ = Major negative impact

Length of History (15%)

• Longer is better
• Keep first card open forever

Credit Mix (10%)

• Having different types helps (cards, loans)
• Not critical early on

New Credit (10%)

• Each application = hard inquiry (-5 to -10 points)
• Space applications 3-6 months apart

Real Timeline: Zero to 700+ Score

Starting Point: No credit score

Month 1-3:

• Use secured card monthly
• Pay on time
• Score: N/A (building)

Month 4-6:

• Credit score appears: 580-620 range
• Continuing on-time payments
• Score: 600-650

Month 7-12:

• Established payment history
• Possible graduation to unsecured
• Score: 650-700

Month 13-18:

• Good credit established
• Can apply for second card
• Score: 680-720

Month 18-24:

• Multiple credit lines
• Longer history
• Score: 700-750+

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Advanced Strategies

The Two-Card Method (Accelerated Building)

Month 1-6: Get and use one secured card perfectly

Month 6-9: Apply for second secured card (different issuer)

Why it works:

• Two cards = two reporting tradelines
• Lower utilization (more available credit)
• Faster credit building
• Redundancy if one card has issues

Example:

• Card 1: Discover it Secured ($300 limit)
• Card 2: Capital One Platinum ($200 limit)
• Total credit: $500
• Spend $50/month total = 10% utilization vs 16.6% with one card

The Graduation Timing Strategy

Don’t wait passively for graduation:

Month 8: Request upgrade if not automatic
Month 12: If denied, apply for new unsecured card elsewhere
Month 13: Close secured card (after unsecured approval) or keep both

The Credit Limit Increase Approach

Every 6 months:

1. Request credit limit increase
2. Either add deposit OR request increase without deposit
3. Lower utilization ratio improves score

Example:

• Start: $500 limit, $50 usage = 10% utilization
• After increase: $1,000 limit, $50 usage = 5% utilization
• Better for credit score

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Costs Breakdown: Year 1

Discover it Secured

• Deposit: $200 (refundable)
• Annual Fee: $0
• Interest: $0 if paid in full
• Cashback Earned: ~$50-150
• Net Cost: -$50 to -$150 (you make money)

Capital One Platinum

• Deposit: $49-$200 (refundable)
• Annual Fee: $0
• Interest: $0 if paid in full
• Rewards: None
• Net Cost: $0

OpenSky Secured

• Deposit: $200 (refundable)
• Annual Fee: $35
• Interest: $0 if paid in full
• Rewards: None
• Net Cost: $35

Chime Credit Builder

• Deposit: Uses your balance (not locked)
• Annual Fee: $0
• Interest: $0 (impossible to pay interest)
• Rewards: None
• Net Cost: $0

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When to Upgrade From Secured Card

Upgrade when you’ve achieved:

✅ 12+ months of on-time payments
✅ Credit score 680+
✅ Low credit utilization (under 30%)
✅ Stable income

Signs you’re ready for unsecured card:

• Card issuer offers you graduation
• You receive pre-approved offers in mail
• Your credit score crossed 680-700
• You’ve maintained account for 12+ months

Best unsecured cards to apply for next:

1. Chase Freedom Unlimited (5% grocery first year, 3% dining/drugstores)
2. Citi Double Cash (2% on everything)
3. Discover it Cash Back (5% rotating categories)
4. Capital One QuicksilverOne (1.5% everything, $39 fee)

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Red Flags to Avoid

❌ Cards with Monthly Maintenance Fees

Some secured cards charge $5-10/month “maintenance fees.” Avoid these. Stick with cards that have $0 annual fee or low one-time annual fee.

❌ Cards That Don’t Report to All 3 Bureaus

Verify card reports to Experian, Equifax, AND TransUnion. Some no-name cards only report to one bureau.

❌ Cards with No Graduation Path

OpenSky is exception (worth it for guaranteed approval). But generally, choose cards that graduate to unsecured.

❌ Prepaid/Debit Cards Marketed as “Credit Cards”

Not the same. Look for “secured credit card” specifically. Prepaid cards don’t build credit.

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Alternatives to Secured Cards

If You’ve Been in US 3+ Months:

Petal 2 Visa: No deposit, looks at bank account instead of credit history

• No security deposit
• 1-1.5% cashback
• Requires SSN (not ITIN) and 3+ months US bank account history

If You’re an International Student:

Deserve EDU Mastercard: No deposit, no SSN required initially

• 1% cashback
• Built for F-1 visa students
• Can apply without SSN

Best Credit Cards for Immigrants and international students

If You Want Fastest Credit Building:

Authorized User: Ask family member with good credit to add you as authorized user

• Instant credit history
• Their payment history helps your score
• No deposit required
• Downside: Dependent on their credit behavior

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Bottom Line: Best Secured Card for Most People

For 80% of people: Discover it Secured

Why:

• $0 annual fee (saves $35-49/year vs competitors)
• Earn cashback (most secured cards offer no rewards)
• Automatic graduation review at 8 months
• Free FICO score tracking
• Strong customer service
• Proven track record of graduation

Total cost over 12 months: $0 in fees, +$50-150 in cashback = You make money while building credit

Alternative if budget is tight: Capital One Platinum with $49 deposit

Alternative if denied everywhere: OpenSky for guaranteed approval

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Start Building Credit Today

The biggest mistake is waiting. Every month you delay is another month without credit history.

Your action plan:

1. Choose card from list above (Discover it Secured for most people)
2. Apply online (takes 10 minutes)
3. Make deposit when approved
4. Use card for small purchases
5. Pay in full every month
6. Watch your credit score grow

In 6-12 months, you’ll have good credit that qualifies you for apartments, car loans, better credit cards, and lower insurance rates.

Don’t overthink it. Pick a card, apply, and start building today.

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Need help deciding which secured card is right for you? Check out our detailed comparison of the best credit cards for immigrants with no credit →

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