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  • What is a Secured Credit Card?

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  • A secured credit card is a card which is backed by a payment which is used as collateral. A secured credit card is usually offered to the people who do not have a credit history or have a limited credit history by still require a credit card.

    Banks provide these secured credit cards to their customers to help them build their credit profile. The credit card is issued only after a certain amount is paid to the bank and that amount usually acts as the credit limit of the card.

     

    Difference between a secured credit card and prepaid credit card

    The major difference between a secured credit card and a prepaid credit card is the credit history of the customer.

    A secured credit card is given to a customer who have a limited credit history or none and is usually given to build up their creditworthiness. The bank has a secured card to a customer in exchange for a certain amount of money to deposit as collateral. This deposit which is made becomes the credit limit of the provided card. The credit limit can be increased by adding sufficient funds to the account or if you have a good repayment history, the bank will add a certain amount to your monthly limit.

    On the other hand, a prepaid credit card has no collateral involved. As the name suggests, it is prepaid and comes with a credit limit provided by the bank depending on a number of factors. These factors are the credit report of the customer, the credit score, and payment records which showcase the ability or inability of the customer to repay the amount spent.

    If you do not have sufficient credit, a secured credit card is the safest option as they do not charge high rates of interest like an unsecured credit card and do not have a high annual or joining fee.

    However, for an unsecured credit card, it is advised to keep your expenses on the low and pay it back in full at the end of the month. The credit utilization ratio must be between 10%-20% at the most. Having a secured credit card means to spend wisely and not more than you can pay off.

     

    Applying for a Secured Credit Card

    Applying for a secured credit card is not any different than applying for an unsecured one. It is a fast and simple process as most major banks just check your credit score and do not conduct any other inquiries on your credit history or report.

    Even though it is a simple process, there are few things which must be kept in mind before applying for a secured credit card.

    Credit Limit:

    It is very important to make sure that you do not go overboard with your credit limit. It is advised to start with a lower credit limit and then increase it only when you will be able to pay it off in full at the end of the month. If you deposit a large sum of money, it does not mean that you should spend it all. Banks will have a constant check on your spending habits, so if you have a good repayment history, banks can allocate a certain amount of money to your credit card without you making any kind of deposit.

    Eligibility:

    Every bank has its own eligibility criteria when it comes to a secured credit card. While some banks require a minimum deposit required for the card, other banks need you to open an FD in the bank and that amount in the fixed deposit serves as the collateral required by the bank in case you are not able to pay your dues.

    Benefits:

    It is important to conduct thorough research on the types of secured credit cards and the ones which offer you the most benefits. Secured credit cards offer you a wide range of discounts and offers just like an unsecured card.

     

    Features and Benefits of Secured Credit Cards

    Secured credit cards have a number of benefits and features surrounding them and are mainly for the people who do not have enough credit history required for an unsecured or prepaid credit card.

    Some of the features of a secured credit card are:

    • The applicants are not required to provide additional inquiries of their credit history.
    • The process of approval is fast as the banks are risk-free since the individuals are offered the cards on the back of a deposit serving as collateral.
    • There are some banks which offer interest on the security deposit. This helps the applicants of secured credit cards to earn interest on their deposit along with the benefits.
    • Some secured credit cards come with a grace period. This helps individuals to get a few days more to make their payments, in case of any delay.
     

    Top Secured Credit Cards Available in the Market

    SBI Advantage Plus Card

    This Advantage Plus Card is among the best secured credit cards in the market. This card offers much more benefits than a regular credit card and can be used both nationally and internationally. The card offers a credit limit up to 85% of the amount deposited in the FD account.

    Features of SBI Advantage Plus Card
    • Extended credit allows the cardholders to pay the minimum amount and carry forward the remaining amount at the low interest of 2.25% per month.
    • The cash withdrawal limit is up to 100% of the credit limit.
    • Comes with ‘Easy Money’ facility. This enables cardholders to get a demand draft or cheque delivered to their registered address.
    • Cardholders can transfer credit from other credit cards at a nominal processing fee.
    • Individuals with this card become automatically eligible for an Encash facility of either Rs. 25,000 or Rs, 50,000. A Fixed Deposit is opened in their name with they are billed Rs. 2,500 or Rs. 5,000 as EMI for 11 months.
    Benefits of SBI Advantage Plus Card:
    • Can be used at more than 1 million Visa or MasterCard ATMs globally.
    • Transactions can be converted into EMIs using the Flexipay option.
    • Interest is provided on the fixed deposit after 555 days.
    • Benefits of supplementary credit cards.
     

    ICICI Bank Coral Credit Card

    This card offered by ICICI bank offers credit limit up to 85% of the fixed deposit. For an individual to avail the card, you will need to have Rs. 20,000 in his/her fixed deposit account for a period of 180 days.

    Features of ICICI Bank Coral Credit Card:
    • Only ID proof required to avail this credit card.
    • A welcome benefit worth Rs. 999 from Provogue is given.
    • The reward points earned can be converted into gift vouchers and cash.
    • Ensures secure transactions with an embedded microchip.
    Benefits of ICICI Bank Coral Credit Card
    • Joining fee is very low with only Rs. 500.
    • Buy one get one free’ offer can be availed all through the week on movie tickets.
    • Double reward points earned for transactions at supermarkets and dining.
    • Free airport lounge access
    • 15% discount on dining at more than 800 partner restaurants.
     

    ICICI Bank Instant Platinum Credit Card

    This secured credit card is for those who have a minimum credit requirement. To avail this card, an applicant needs to have a minimum fixed deposit of Rs. 20,000 with the bank.

    Features of Instant Platinum Credit card:
    • No requirement for any ID proof.
    • The interest rate is a mere 2.5% per month on this card.
    • The card has 3 embedded microchips to offer the highest security.
    Benefits of Instant Platinum Credit card:
    • Cash withdrawal up to 100% of the credit limit.
    • Free credit for up to 50 days.
    • Fuel surcharge waiver of 2.5% on all transactions.

    FAQs Related to Secured Credit Card

    1. What is a good secured credit card?
    2. A good secured credit card helps you build credit and contributes highly to your credit score as well. The credit card requires a certain amount of money to be paid as deposit and that deposit is usually considered as the credit limit of your card. Timely repayment of dues results in the building of good credit which can help you apply for a prepaid credit card.

    3. Will a secured card build credit?
    4. A secured credit card is offered by the bank for the sole reason of building credit for the people who do not have enough credit to apply for a prepaid credit card.

    5. Does closing a secured credit card hurt?
    6. Closing any credit card will hurt your credit score. It is always advised to keep a credit card open even if you are not using it. It can always be kept for emergencies. Closing or cancelling a card can reflect poorly on your spending habits. To know more it is advised you get in touch with the bank.

    7. How fast can you build credit with a secured credit card?
    8. Building credit with your secured credit card can only happen if you are spending wisely and not more than you can afford. By having a secured credit card, only the money you put in as deposit will be available to you as a credit limit. However, it is always better to start with smaller purchases which are easy to pay off. If you are increasing your expenditure gradually on a monthly basis, it will help you build your credit score faster.

    9. How long should I keep a secured credit card?
    10. You can keep a secured credit card as long as required. To know more it is advised you get in touch with the representative of the bank.

    11. Do I get my deposit back from a secured credit card?
    12. No, once you have given the money as a deposit to the bank, it is used as collateral for the bank in case you are not able to pay your dues. In most cases, the money as your credit limit comes from the deposit and is subtracted as an when you wish to increase your limit. Once you cancel or close your card, only then the bank will make the calculations and return the remainder of the money, if any.

    13. How can I increase my secured credit card limit?
    14. You can increase your credit limit on your secured credit card by requesting the bank by contacting the customer care of the bank or by visiting the bank branch. The credit limit will be increased depending on the amount you have deposited in the bank as collateral.

      

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    Secured Credit Card Reviews

    • Axis Bank Credit Card
      "Best Service"
      0.5 3.5/5 "Pretty good"
      I have Axis bank credit card which was applied through Bank directly.I am using this credit card for the past 8 months .This was a chargeable card .The credit limit was really good and it was sufficient .I have got this credit card on time and got all the details about the card process.
      Was this review helpful? 1
      , vellore
      Reviewed on Sep 13, 2019
    • ICICI Bank
      ICICI Bank Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      I am using ICICI Bank credit card which was directly taken through Bank .I am using this credit card for the past 3 years .I have got a very good credit limit and got all the required information about the card process This was a free card .I have not used and checked cash back offers and reward points .
      Was this review helpful? 1
      , surat
      Reviewed on Sep 13, 2019
    • HDFC Bank Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      I am using HDFC Bank credit card which was directly taken through Bank .I am using this credit card for the past 3 years .I have got a good credit limit and got all the relevant information about the card process.I have not checked cash back offers and reward points .I have not used this card much so far.
      Was this review helpful? 2
      , surat
      Reviewed on Sep 13, 2019
    • Canara Bank Credit Card
      "Good Credit Card"
      0.5 5.0/5 "Blown Away!"
      I have a credit card of Canara bank with life time free benefits, but I am not using it often. The credit limit is sufficient for my transactions, I have been holding this card from 2006 I didn't request for any upgrade on the card because I don't have interets however there is no hidden charges taken from my end.
      Was this review helpful? 0
      , panipat
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I came to know about Bank bazaar through Online .This website is really doing a very good service .Customer service is really good and comfortable to me so far .Each and every financial products will be processed in a smooth manner it is really good .I am really satisfied with the service.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 13, 2019
    • IndusInd Bank Credit Card
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      I am using Indusind Bank credit card which was applied through Online .This card is having a very good credit limit and also there are reward points as well cash back offers which is really convenient .There was no difficulties faced so far on using this credit card .I am really satisfied with the service.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I came to know about Bank bazaar through Online .This website is having a better facility to check credit score since it is a free service can check whenever necessary .Whatever the needs it will be fulfilled through this portal .We can get all the information such as loans and credit cards and also update to information will be received when apply for any products.
      Was this review helpful? 0
      , pune
      Reviewed on Sep 13, 2019
    • IndusInd Bank Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      I am using Indusind Bank credit card which was applied through Online .In this credit card will have offers for Shopping and movie ticket bookings which is really good .I have got this credit card on time .The credit limit was 93,000 and it was really sufficient .There was no drawbacks faced while submitting the documents .
      Was this review helpful? 1
      , pune
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Good"
      0.5 4.0/5 "Great!"
      I have downloaded Bankbazaar's mobile application. I get to see my updated credit score through Bankbazaar's mobile application. It's very simple and easy to use. I had come to know about Bankbazaar from an advertisement. Happy with their service.
      Was this review helpful? 0
      , gurgaon
      Reviewed on Sep 13, 2019
    • IndusInd Bank Credit Card
      "Good"
      0.5 5.0/5 "Blown Away!"
      I received my INDUSIND BANK PLATINUM AURA EDGE MASTER CARD. Credit limit is lower than I expected. I was expecting 1 lakh but they have given only 75 thousand. I had received the card on time and annual fee is free.I am getting reward points and offers.
      Was this review helpful? 0
      , gurgaon
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Good"
      0.5 5.0/5 "Blown Away!"
      I have been using Bankbazaar's website for the past 8 to 10 months. I used to check my credit score on Bankbazaar's website. Their customer care executives were very helpful. They had provided clear information when I applied for credit card.
      Was this review helpful? 0
      , new delhi
      Reviewed on Sep 13, 2019
    • IndusInd Bank Credit Card
      "Good"
      0.5 5.0/5 "Blown Away!"
      I had applied an Indusind Bank credit card. I received the card on time. There was no problem submitting the documents. I have got sufficient credit limit.I have received the card on time and it is a lifetime free card. Reward points are good.
      Was this review helpful? 0
      , new delhi
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Informative Website"
      0.5 5.0/5 "Blown Away!"
      I am getting more service from Bank Bazaar.com, whenever I approach for any loans, credit card, the service level is satisfactory. The customer representatives are very polite interms of answering my queries. The website is very good to check all information.
      Was this review helpful? 0
      , new delhi
      Reviewed on Sep 13, 2019
    • IndusInd Bank Credit Card
      "Good Card"
      0.5 5.0/5 "Blown Away!"
      My Indusind bank platinum aura card has the shopping benefits without any yearly fee and joining fee. More over the credit limit is sufficient around Rs.75,000 its enough for me and they do have fuel surcharges for petrol filling at selected partners.
      Was this review helpful? 0
      , new delhi
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Good"
      0.5 4.0/5 "Great!"
      I have been using Bankbazaar's website for a while. Their website and mobile application and very user friendly. I have come to now about Bankbazaar.com from the internet. I always check credit score on their website. Customer service was good.
      Was this review helpful? 0
      , chennai
      Reviewed on Sep 13, 2019
    • YES Bank Credit Card
      "Good"
      0.5 4.0/5 "Great!"
      I have received my YES PROSPERITY EDGE from Yes Bank. Credit limit is good and there is no annual fee.Yes bank customer service was good, I had received the card on time. The features of the card are great. I am getting reward points and cashback offer.
      Was this review helpful? 0
      , chennai
      Reviewed on Sep 13, 2019
    • Citibank Credit Card
      "Good card for all spends"
      0.5 4.0/5 "Great!"
      From CITI bank I got reward card, best part I could convert the rewards points into cash and if I use this credit card at Indian oil petroleum they give cash back. This card has life time free benefits, they already gave me sufficient limit hence its fine for me.
      Was this review helpful? 2
      , pune
      Reviewed on Sep 13, 2019
    • HDFC Bank Credit Card
      "Good for travelers"
      0.5 5.0/5 "Blown Away!"
      Past 4 years I have been holding HDFC card, earlier I had rewards titanium credit card very recently I upgraded to Regalia card it has yearly fee. They are providing airport lounge facility with travel discounts at make my trip and goibgo. The customer care executives are very helpful but rate of interest is higher for the late fee.
      Was this review helpful? 1
      , pune
      Reviewed on Sep 13, 2019
    • Bank Bazaar Credit Card
      "Satisfactory"
      0.5 5.0/5 "Blown Away!"
      I appreciate the responsiveness of Bank Bazaar.com, they are more prompt when I approached for the YES Bank card, I got satisfactory service. First time I came the site through internet search then I logged in for the credit card purchase. It would be great if Bank Bazaar provides more offers based on the customer profile.
      Was this review helpful? 0
      , pune
      Reviewed on Sep 13, 2019
    • YES Bank Credit Card
      "E commerce offers should be increased"
      0.5 3.0/5 "Satisfactory"
      Reason to select this YES Prosperity card has an option to earn more points based on the spend, they gave me Rs. 35,000 as limit its fine for me. It has life time free benefits but I am not getting any offers at e commerce sites like amazon, flipkart.
      Was this review helpful? 1
      , pune
      Reviewed on Sep 13, 2019
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