What the Avenue Credit Card Is
The Avenue Credit Card is a secured credit card issued by Avenue Finance, designed for people rebuilding credit or establishing a credit history for the first time. You put down a cash deposit, and that deposit becomes your credit limit — so a $500 deposit gives you a $500 limit. The card reports to all three major credit bureaus (Equifax, Experian, and TransUnion), which means your payment history can help raise your credit score over time.
The card is not a prepaid card. You still make monthly payments from your regular bank account, and you can carry a balance if you choose — though doing so costs you interest. The deposit sits in a separate account and is not touched unless you stop paying your bill.
Key Takeaways
- Avenue requires a cash deposit equal to your credit limit, ranging from $300 to $2,500, which you hold in a separate account and can reclaim later.
- The card charges an annual fee of $59 and a monthly maintenance fee of $1, plus interest on any balance you carry — the APR varies by creditworthiness but typically runs 19.99% to 29.99%.
- Payments are reported to all three credit bureaus, so on-time payments build your credit history and can improve your score over months.
- After 12 to 18 months of on-time payments, you may be able to convert the card to an unsecured card and recover your deposit.
Deposit, Fees, and Interest Rates
Your deposit is the foundation of this card. Avenue accepts deposits from $300 to $2,500. The deposit sits in a money market savings account held by Avenue, and you earn a small amount of interest on it — currently around 4.5% APY, though this rate changes. You do not lose the deposit when you use the card; it stays there as collateral.
Beyond the deposit, you pay an annual fee of $59 and a monthly maintenance fee of $1. That $1 monthly fee adds up to $12 per year on top of the $59 annual fee, for a total of $71 in yearly charges before you even carry a balance. The APR on purchases ranges from 19.99% to 29.99% depending on your credit profile at the time you open the account. If you carry a $500 balance for a full year at 24.99% APR, you would pay roughly $125 in interest alone.
Avenue does not charge a late fee if you miss a payment, but missing a payment will hurt your credit score and may trigger a call from their collections team. There is no foreign transaction fee, which is useful if you travel internationally.
How Payments and Credit Reporting Work
You make payments online, by phone, or by mail each month. Avenue reports your payment history to Equifax, Experian, and TransUnion every month. This means that if you pay on time every month, those bureaus record it, and your credit score can improve over time — typically by 30 to 100 points within the first six months of consistent on-time payments, depending on your starting score and other factors in your credit file.
The minimum payment is typically 1% of your balance plus fees and interest, though Avenue may require a higher minimum depending on your account. If you carry a balance, you will pay interest on it. The best use of this card is to charge a small amount each month (say, $50 to $100) and pay it off in full before the due date, so you build payment history without paying interest.
Avenue also reports late payments and defaults to the bureaus, so missing payments will damage your score. A single late payment can drop your score by 50 to 100 points, and the damage lingers for seven years on your credit report.
When the Card Converts to Unsecured
After 12 to 18 months of on-time payments, Avenue may offer to convert your secured card to an unsecured card. When this happens, your deposit is returned to you, and the card continues to work the same way — except you no longer have collateral behind it. The APR, annual fee, and monthly fee remain the same unless Avenue changes them.
Conversion is not automatic. Avenue reviews your account and decides whether to offer it based on your payment history and credit score. If you have missed even one payment, conversion is unlikely. If you have made every payment on time and your credit score has improved, you have a reasonable chance of being offered conversion.
Some cardholders never receive a conversion offer. If that happens, you can request one after 18 months of perfect payments, though Avenue is not required to grant it. You can also close the account and recover your deposit at any time, though closing it will affect your credit score slightly because it reduces your available credit and shortens your average account age.
Comparing Avenue to Other Secured Cards
Other secured cards exist, and the differences matter. The Capital One Secured Mastercard, for example, charges a $39 annual fee (lower than Avenue's $59) but no monthly maintenance fee. Discover it Secured charges a $0 annual fee but requires a $200 minimum deposit. The Citi Secured Mastercard charges $49 annually and no monthly fee.
The trade-off is usually between annual fees and monthly fees. Avenue's $1 monthly fee ($12 per year) plus $59 annual fee totals $71 yearly, which is higher than most competitors. However, Avenue's deposit earns interest at a competitive rate, which offsets some of that cost. If you plan to keep the card for a year or more, the interest earned on your deposit can cover $10 to $20 of those fees.
The APR varies by cardholder and by card, so comparing rates across cards is difficult without explore. Avenue's range of 19.99% to 29.99% is typical for secured cards aimed at people rebuilding credit. If you have a very low credit score, you may face the higher end of that range regardless of which card you choose.
Who This Card Makes Sense For
The Avenue card works best for people who have a credit score below 600 and need to build a payment history. If you have no credit history at all — you are a young adult, an immigrant, or you have been out of the credit system for years — a secured card is often the fastest way to establish one. The monthly reporting to all three bureaus means your score can start moving within a few months.
It also works for people rebuilding after a major credit event like a bankruptcy, foreclosure, or long period of missed payments. The secured structure means you are less likely to be rejected, and the deposit gives you a clear limit to work within.
The card does not make sense if you already have a credit score above 650 and access to unsecured cards. The fees and interest rate are too high compared to what you could get elsewhere. It also does not make sense if you cannot afford to keep a deposit locked up for a year or more — that money is not available for emergencies while it sits in Avenue's account.
The Real Cost Over Time
Let's walk through a realistic scenario. You deposit $500, charge $75 per month to the card, and pay it off in full each month. Over 12 months, you pay $71 in fees ($59 annual plus $12 in monthly fees). You earn roughly $22 in interest on your $500 deposit at 4.5% APY. Your net cost is about $49 for a year of credit building.
Now imagine you carry a $250 balance for six months at 24.99% APR. You pay roughly $31 in interest on that balance, plus $35.50 in fees (half the annual fee plus six monthly fees). Your net cost is about $66.50, and you have paid interest on top of fees. This is why paying off your balance each month matters — the fees are unavoidable, but the interest is not.
After 12 to 18 months, if Avenue converts your card to unsecured, you recover your deposit and the card becomes a standard credit card with the same fees and APR. At that point, you should compare it to other unsecured cards and consider moving if you find a better option.
Frequently Asked Questions
Can I get my deposit back before 12 months?
You can close the account and recover your deposit at any time, but closing the account will hurt your credit score because it reduces your available credit and shortens your average account age. Most people wait at least 12 months before closing to let the positive payment history build.
What happens if I miss a payment?
Avenue will report the missed payment to the credit bureaus, which will damage your score. They do not charge a late fee, but they may call you. If you miss multiple payments, they may freeze your account or close it. Your deposit is not touched unless you default completely.
Does Avenue do a hard pull on my credit?
Yes, Avenue performs a hard inquiry when you open an account, which temporarily lowers your credit score by a few points. This is normal for credit cards and secured cards. The inquiry falls off your report after two years.
Can I increase my credit limit?
You can request a credit limit increase by depositing more money into your account. For example, if you deposit an additional $250, your limit rises to $750. You can also ask Avenue to increase your limit based on your payment history, though they are not required to grant it.
Is the interest earned on my deposit taxable?
Yes. Avenue will send you a 1099-INT form at the end of the year if you earn more than $10 in interest, and you will owe income tax on that interest. The amount is usually small, but it is taxable income.