The Indigo Card is a real credit card issued by a real bank, but it's designed for people rebuilding credit and comes with costs that mainstream cards don't have
The Indigo Card is issued by Coastal Community Bank, a federally chartered bank based in Medford, Oregon. It's a secured credit card, meaning you deposit cash as collateral before you can use it. The card itself is legitimate — it reports to all three credit bureaus, it works at merchants that accept Visa, and the bank is regulated by the Office of the Comptroller of the Currency.
The reason people ask whether it's legitimate is usually because of the fees. The Indigo Card charges an annual fee of $95, a monthly maintenance fee of $7.50, and a one-time processing fee of $89. Those fees are real, they're disclosed in the terms, and they're higher than what you'd pay for a mainstream credit card. But they're not hidden, and they're not a scam — they're the business model for a card aimed at people with poor credit or no credit history.
Whether the Indigo Card makes sense for you depends on what you're trying to do. If you're rebuilding credit and can't get approved for a standard secured card, it may be worth considering. If you have other options, the fees will probably make it a worse choice.
Key Takeaways
- The Indigo Card is issued by Coastal Community Bank, a real federally regulated bank, and reports to all three credit bureaus.
- The card charges $95 annual, $7.50 monthly, and $89 upfront — fees that are disclosed but higher than mainstream secured cards.
- You need a cash deposit to open the account, and your credit limit equals your deposit amount, capped at $2,500.
- The card is designed for people rebuilding credit, but you should compare it to other secured cards before deciding, because the fees add up quickly.
- The card does report to credit bureaus, so responsible use can help your credit score over time.
How the Indigo Card actually works
When you open an Indigo Card account, you make a cash deposit into a savings account held by the bank. That deposit becomes your credit limit — if you deposit $500, your limit is $500. The maximum deposit and limit is $2,500. You then use the card like any other credit card: you make purchases, you get a monthly statement, and you pay a bill.
The deposit stays in the savings account and earns a small amount of interest. It's not spent when you use the card. Instead, it sits as collateral — if you stop paying your bill, the bank can take the deposit to cover what you owe. This is why secured cards exist: they let people with bad credit or no credit history prove they can handle a card responsibly, because the bank's risk is lower.
After you've used the card responsibly for a period of time — usually 12 to 18 months of on-time payments — you can request that the card be converted to an unsecured card. At that point, you get your deposit back and the card works like a normal credit card with no collateral required.
The fees break down like this
The $89 processing fee is charged when you open the account. The $95 annual fee is charged once per year. The $7.50 monthly maintenance fee is charged every month, which adds up to $90 per year on top of the annual fee. Over the first year, you're paying $89 + $95 + $90 = $274 in fees before you've even used the card.
If you deposit $500 and use the card responsibly, those fees reduce the effective benefit you're getting from the card. You're paying $274 to build credit with a $500 limit. That's a real cost, and it matters when you're comparing this card to other options.
Some secured cards charge no annual fee or no monthly fee. Capital One's Secured Mastercard, for example, charges a $29 annual fee but no monthly maintenance fee. Discover's secured card charges no annual fee and no monthly fee. If you have the option to get approved for one of those cards instead, the Indigo Card's fees make it a worse deal.
When the Indigo Card might make sense
The Indigo Card is most useful if you've been turned down for other secured cards and need a way to start building credit. Some people have credit so damaged or credit history so thin that mainstream lenders won't approve them, even for secured cards. If you're in that position, the Indigo Card will take you — the approval standards are looser than for other cards.
The card also reports to all three credit bureaus (Equifax, Experian, and TransUnion), so on-time payments do show up on your credit report. If you make your payments on time every month, your credit score should improve over time, which is the whole point of using a secured card.
The monthly maintenance fee is unusual for a credit card, and it's the part that makes this card expensive. But if you're in a situation where you have no other way to build credit, paying $7.50 a month to do it may be worth it to you.
Red flags that aren't actually red flags
The Indigo Card advertises heavily online and on social media, which sometimes makes people suspicious. But heavy advertising doesn't mean a company is a scam — it means they're spending money to reach people who might not find them otherwise. The Indigo Card's target market is people with bad credit, and those people are less likely to stumble across a credit card through normal channels, so the company advertises.
The fact that the card charges monthly fees is also unusual, but it's not a scam. It's a business decision. The bank is taking on higher risk by lending to people with poor credit, so they charge higher fees to offset that risk. You may not like the fees, but they're not hidden or deceptive.
The card's terms and conditions are long and detailed, like any credit card agreement. If you want to read them before opening an account, you can find them on the Indigo Card website. There's nothing in them that contradicts what the company advertises.
How to compare the Indigo Card to other options
Before you open an Indigo Card account, try to get approved for other secured cards first. explore for Capital One's Secured Mastercard, Discover's secured card, or a secured card from your own bank. These cards have lower fees and may approve you even if you have poor credit.
If you get approved for one of those cards, use that one instead. The fees will be lower and the terms will be better. If you get turned down for all of them and the Indigo Card approves you, then you have a real choice to make: pay the Indigo Card's fees to build credit, or don't build credit at all.
Keep track of how long you've been using the card responsibly. After 12 to 18 months of on-time payments, contact the bank and ask about converting to an unsecured card. Once you convert, you get your deposit back and the monthly fees stop — you'll only pay the annual fee like a normal credit card.
What happens to your deposit
Your deposit is held in a savings account at Coastal Community Bank. The bank pays interest on the deposit, though the rate is typically very low — often less than 0.01% annually. You can't touch the deposit while the card is active, but you can close the account and get the deposit back at any time.
If you stop paying your bill, the bank can use the deposit to cover what you owe. After that, if you still owe money, they can pursue collection like any other creditor. So the deposit protects the bank, not you — it's collateral, not insurance.
When your card is converted to unsecured, the deposit is returned to you. The bank will mail you a check or deposit it into an account you specify. At that point, you no longer have collateral on the card, and the bank is taking on the same risk they would with any other cardholder.
Frequently Asked Questions
Is the Indigo Card a scam?
No. The Indigo Card is issued by a real bank regulated by the Office of the Comptroller of the Currency. The fees are real and disclosed upfront. The card reports to credit bureaus and works at merchants that accept Visa. It's not a scam, but it is expensive compared to other secured cards, so you should compare your options before opening an account.
Can I get my deposit back?
Yes. Your deposit is held in a savings account and earns interest. You can close the account and withdraw your deposit at any time. If your card is converted to unsecured after 12 to 18 months of on-time payments, the bank will return your deposit automatically.
What if I can't pay my bill?
If you miss a payment, the bank will report it to the credit bureaus, which will hurt your credit score. If you continue to miss payments, the bank can use your deposit to cover what you owe. After that, they can pursue collection. Missing payments defeats the purpose of using the card to build credit.
How long does it take to convert to an unsecured card?
Most people can request conversion after 12 to 18 months of on-time payments. The bank reviews your account and decides whether to convert. There's no may provide they will, but responsible use makes it more likely. Contact the bank directly to ask about your account.
Are there credit cards with no fees at all?
Yes, but they usually require better credit. If you have poor credit or no credit history, you may not be approved for a no-fee card. Discover's secured card and Capital One's Secured Mastercard have lower fees than the Indigo Card. Try those first before opening an Indigo Card account.