The main places to get a secured card are traditional banks, credit unions, and online-only lenders
You can open a secured credit card at a bank branch, through an online bank, at a credit union, or through a fintech lender. Each route has different deposit requirements, fees, and approval timelines. The card itself works the same way regardless of where you get it — you put down cash as collateral, and the lender issues you a card with a credit limit equal to your deposit. The difference is in how much that deposit costs you, how quickly you get approved, and what happens after you build credit.
Most people find their best option by comparing three to five lenders on deposit amount, annual fee, and whether the card reports to all three credit bureaus. You do not need to visit a branch in person; most secured cards are opened entirely online.
Key Takeaways
- Traditional banks like Capital One and Discover offer secured cards with no annual fee or a low one, but may require a larger deposit or have stricter approval standards.
- Credit unions often have lower deposit minimums and fees than banks, but you must be a member first, which sometimes requires living or working in a specific area.
- Online lenders and fintech companies approve faster and have lower barriers to entry, but some charge higher annual fees or report to fewer credit bureaus.
- All secured cards should report your payment history to Equifax, Experian, and TransUnion so your credit score improves over time.
- After 6 to 18 months of on-time payments, most lenders will convert your card to unsecured or let you graduate to a regular credit card.
Traditional banks and their secured card programs
Capital One and Discover are the two largest issuers of secured cards in the United States. Capital One's Secured MasterCard requires a minimum deposit of $200 and charges a $29 annual fee. Discover's Secured Card requires a minimum deposit of $200 with no annual fee. Both report to all three credit bureaus and review your account after six months to consider converting it to an unsecured card.
Other banks offer secured cards as well, though availability varies by state. Bank of America, Wells Fargo, and US Bank each have secured card products, but their terms differ — some require higher deposits, some charge annual fees, and some have different credit reporting practices. You can check whether your current bank offers a secured card by logging into your online account or calling their customer service line.
The advantage of a traditional bank is stability and a clear path to graduation. The disadvantage is that approval can take longer, and some banks have stricter income or credit history requirements than online lenders do.
Credit unions and membership requirements
Credit unions typically offer secured cards with lower fees and smaller deposit minimums than banks. Many require deposits as low as $300 to $500 and charge no annual fee. The catch is that you must be a member of the credit union first, and membership rules vary.
Some credit unions are open to anyone in a geographic area — for example, any resident of a county or state. Others are employer-based, meaning you must work for a specific company or organization. Still others serve members of a particular industry, union, or religious group. You can search for credit unions you may be may be able to access to join using the CO-OP Network locator or by visiting CULookup.com.
Once you join, the process process for a secured card is usually straightforward and can be done in person or online. Credit unions often approve applications within a few days and may offer to convert your card to unsecured after 12 months of on-time payments.
Online lenders and fintech companies
Online-only lenders like Chime, LendingClub, and SoFi offer secured cards with fast approval and low or no annual fees. Many approve applications within 24 to 48 hours and deposit funds into your account when ready. Deposit minimums are often $200 to $500, similar to traditional banks.
The advantage of fintech lenders is speed and accessibility — you do not need to visit a branch or meet membership requirements. Many also offer additional features like spending tracking, savings tools, or integration with budgeting apps. The disadvantage is that some fintech lenders do not report to all three credit bureaus, which means your credit score may not improve as quickly. Before you open an account, confirm that the lender reports to Equifax, Experian, and TransUnion.
Some fintech companies also charge higher annual fees than traditional banks — sometimes $50 or more — so compare the total cost of the deposit plus the annual fee before deciding.
Comparing deposit amounts and annual fees
The cost of a secured card is the sum of two things: the deposit you put down and the annual fee you pay each year. A card with a $200 deposit and no annual fee costs you $200 in year one. A card with a $500 deposit and a $29 annual fee costs you $529 in year one.
Your deposit is held in a savings account and earns little to no interest — most secured cards offer 0% to 0.5% annual percentage yield on the deposit. You get the deposit back when you close the card or graduate to an unsecured card, so it is not money you lose. The annual fee, however, is money you pay to the lender and do not recover.
If you have limited funds, prioritize finding a card with no annual fee and the lowest deposit minimum you can find. If you have more flexibility, a slightly higher deposit with no annual fee is usually better than a lower deposit with a high annual fee.
Credit reporting and how it affects your score
A secured card only helps your credit score if the lender reports your payment history to the credit bureaus. Before you open an account, confirm in writing that the lender reports to all three bureaus — Equifax, Experian, and TransUnion. If a lender reports to only one or two, your score will improve more slowly.
Once you have the card, your payment history is reported monthly. Making on-time payments every month is what builds your credit. Missing a payment or paying late will hurt your score, just as it would with any other credit card. After six to 18 months of on-time payments, most lenders review your account and either convert the card to unsecured or invite you to graduate to a different card with better terms.
The process process and what to expect
Most secured card applications are completed online and take 10 to 15 minutes. You will need to provide your Social Security number, date of birth, address, and income information. The lender will run a soft credit inquiry (which does not affect your credit score) and sometimes a hard inquiry (which does lower your score slightly for a few months).
After approval, you will be asked to fund your deposit. Some lenders allow you to transfer money from a bank account when ready; others mail you a check or require you to visit a branch. Once the deposit is received, your card is usually mailed within 5 to 10 business days. Online lenders often provide a temporary digital card number you can use to make purchases while you wait for the physical card to arrive.
If you are denied, ask the lender why. Some denials are based on credit score, but others are based on income, recent negative marks on your credit report, or fraud concerns. You can reapply after addressing the issue — for example, by waiting a few months for a late payment to age or by providing additional income documentation.
Frequently Asked Questions
Can I get a secured card if I have no credit history?
Yes. Secured cards are designed for people with no credit history, recent negative marks, or low credit scores. You do not need an existing credit score to open one. The lender's main concern is that you have the cash deposit to put down and that you can make monthly payments.
What happens to my deposit if I miss a payment?
Your deposit is not forfeited if you miss a payment. The lender will charge you a late fee and report the missed payment to the credit bureaus, which will hurt your score. Your deposit remains in the account and is returned to you when you close the card or graduate to unsecured status.
How long does it take to graduate from a secured card to an unsecured one?
Most lenders review your account after 6 to 18 months of on-time payments. Some automatically convert your card to unsecured; others send you an offer to graduate to a different card. A few require you to request a review. Check your card's terms to see what your lender's policy is.
Do I have to use the card every month to build credit?
You do not have to use the card every month, but using it and paying the balance on time is what builds credit. If you never use the card, the lender has no payment history to report, and your score will not improve. A common strategy is to make one small purchase per month and pay it off in full.
Can I have more than one secured card at the same time?
Yes, but it is usually not necessary. Opening multiple cards in a short time will lower your credit score because each process triggers a hard inquiry. Most people open one secured card, use it responsibly for 6 to 12 months, and then graduate to an unsecured card or a rewards card.