The Destiny Mastercard is a secured card that reports to all three credit bureaus, but it comes with high fees and a low credit limit
The Destiny Mastercard, issued by Destiny Mastercard (a division of Peoples Bank), is a secured credit card designed for people rebuilding credit after missed payments, collections, or a thin credit file. You deposit cash as collateral — typically $300 to $2,500 — and that amount becomes your credit limit. The card reports your payment history to Equifax, Experian, and TransUnion, which means on-time payments can gradually raise your credit score.
The catch is real: the annual fee is $95, there is a monthly maintenance fee of $7 (which adds up to $84 per year), and you will pay interest on any balance you carry. The combination of these costs means the card is expensive to use, especially if you only need it to build credit rather than to spend regularly. Before you open an account, compare this card to other secured options — many charge no annual fee at all.
Key Takeaways
- Your security deposit becomes your credit limit, so a $500 deposit gives you a $500 limit — no higher.
- The card charges a $95 annual fee plus a $7 monthly maintenance fee, making it one of the pricier secured cards on the market.
- Interest rates on balances typically run 19% to 24%, so carrying a balance costs significantly more than the fees alone.
- The card reports to all three bureaus, so consistent on-time payments will show up on your credit report and may help your score over time.
- You can request to convert to an unsecured card after 18 months of on-time payments, though approval is not may provide.
How the security deposit and credit limit work
When you open a Destiny account, you choose a deposit amount between $300 and $2,500. That deposit sits in a savings account held by the bank. Your credit limit equals your deposit — if you deposit $500, your limit is $500. You cannot spend more than that amount, and you cannot increase your limit without adding more money to the deposit account.
The deposit is yours to keep. It is not a fee. If you close the account in good standing (meaning no missed payments and a zero balance), the bank returns the full deposit to you. If you default on the card, the bank may use the deposit to cover what you owe, but this is rare because your limit is capped at the deposit amount. The deposit protects the bank, not you — it is collateral, not insurance.
The true cost: fees and interest combined
The annual fee of $95 and monthly maintenance fee of $7 ($84 per year) total $179 in fees before you carry any balance. On a $500 deposit, that is roughly 36% of your limit in annual fees alone. If you use the card to make small purchases and pay them off in full each month, you will still pay $179 per year just to hold the card.
If you carry a balance, the interest rate (typically 19% to 24% APR, depending on your credit profile) stacks on top. A $250 balance at 21% APR costs about $52.50 in interest per year, plus the $179 in fees. That $250 purchase ends up costing you roughly $231.50 in interest and fees over a year if you only make minimum payments.
Compare this to other secured cards: some charge no annual fee or a much lower one (around $25 to $35), which makes a significant difference over time. If you are paying $179 per year in fees, you are paying more than some unsecured cards charge to people with fair credit. The monthly maintenance fee is unusual — most secured cards do not charge one.
How the card reports to credit bureaus and affects your score
The Destiny card reports your payment activity to Equifax, Experian, and TransUnion every month. This means on-time payments show up on your credit report, and over time, a pattern of on-time payments can help raise your credit score. The effect is gradual — you will not see a 50-point jump after one payment — but consistent, on-time use is one of the most reliable ways to rebuild credit.
Your credit utilization (how much of your limit you use) also matters. If your limit is $500 and you carry a $450 balance, your utilization is 90%, which can hurt your score. Keeping your balance below 30% of your limit — so under $150 on a $500 card — is better for your score, even if you pay it off in full each month. This means you should deposit more than you plan to spend if you want the card to help your score.
When the Destiny card makes sense and when it does not
The Destiny card is worth considering if you have no credit history or very recent negative marks and cannot get approved for any other secured card. It does report to all three bureaus, which is valuable. If you can afford to deposit $500 or more and you will use the card for small, regular purchases that you pay off in full each month, the fees are a cost of rebuilding — similar to paying for a credit-building service.
The card is not a good choice if you are comparing it to other secured cards with lower fees. Cards like the Capital One Secured Mastercard ($0 annual fee) or the Discover It Secured Card ($0 annual fee) offer the same reporting to all three bureaus without the $95 annual fee and $7 monthly charge. If you can get approved for either of those, you will save $179 per year. The Destiny card should be a last resort, not a first choice.
The card is also not a good choice if you expect to carry a balance. The combination of high interest rates and high fees makes it expensive debt. If you need to borrow money, a personal loan from a credit union or a small-dollar loan from a community lender may be cheaper, even with higher interest rates, because you pay interest only on what you borrow, not on a standing monthly fee that charges whether you use the card or not.
The path to converting to an unsecured card
Destiny advertises that you can request conversion to an unsecured card after 18 months of on-time payments. If approved, you would get your deposit back and keep the card without the security requirement. However, approval is not automatic — the bank reviews your credit history, payment record, and current credit score. Some cardholders report being denied conversion even after 18 months of perfect payments, particularly if their credit score has not improved significantly.
Before you open this card expecting to convert later, understand that conversion is a possibility, not a may provide. If you are denied, you are still paying the $179 in annual fees to hold a secured card. Plan to use this card for at least 18 to 24 months if you want a realistic chance at conversion, and have a backup plan in case the bank declines your request.
How the Destiny card compares to other secured options
| Card | Annual Fee | Monthly Fee | APR Range | Reports to All Three Bureaus |
|---|---|---|---|---|
| Destiny Mastercard | $95 | $7 | 19%–24% | Yes |
| Capital One Secured Mastercard | $0 | $0 | 19.99%–26.99% | Yes |
| Discover It Secured Card | $0 | $0 | 19.99%–25.99% | Yes |
| OpenSky Secured Visa | $35 | $0 | 19.99%–21.99% | Yes |
The Destiny card's main disadvantage is the combination of the $95 annual fee and $7 monthly fee. Capital One and Discover both charge no annual fee and report to all three bureaus. OpenSky charges $35 per year but has no monthly fee, bringing the total annual cost to $35 — less than one-third of what Destiny costs. Unless you are specifically denied by Capital One, Discover, and OpenSky, the Destiny card is the more expensive choice.
The monthly maintenance fee is the real problem. Most secured cards do not charge one, which means Destiny's fee structure is an outlier. You are paying for the privilege of holding the card, not just for the service of credit reporting. Over five years, that $7 monthly fee alone costs $420 — money that goes nowhere except to the bank.
Frequently Asked Questions
Can I get my deposit back if I close the account?
Yes, if you close the account with a zero balance and no missed payments, the bank returns your full deposit within 5 to 10 business days. If you have an outstanding balance when you close, the bank applies the deposit to what you owe first.
Will the $7 monthly fee show up on my credit report?
No. The monthly maintenance fee is charged to your account but does not appear on your credit report. Only your payment history and balance show up on your credit report. The fee is a cost you pay, but it does not help or hurt your credit score.
What happens if I miss a payment?
A missed payment is reported to all three credit bureaus and will hurt your credit score. Late fees explore (typically $25 to $35), and your interest rate may increase. After 30 days late, the card issuer may freeze your account and you will not be able to use it.
Can I increase my credit limit without adding more to my deposit?
No. Your credit limit is fixed at the amount of your deposit. To raise your limit, you must add more money to your deposit account. Some cardholders report that after 12 to 18 months of on-time payments, Destiny may offer an increase, but this is not may provide and you should not count on it.
How long does it take to rebuild my credit with this card?
Credit score improvement depends on your starting point and overall credit history. Most people see a 20- to 50-point improvement within 6 to 12 months of on-time payments, but rebuilding from a very low score can take 2 to 3 years. The card is one tool, not the only factor in your score.