Secured Credit Card
A credit card that requires a cash deposit as collateral. The deposit typically equals your credit limit. Secured cards are designed for people with no credit or poor credit and report to the credit bureaus just like regular cards, making them effective credit-building tools.
Related guides
- Full credit & FICO® glossary
Browse all defined terms by category.
- Unsecured Credit Card
A standard credit card that doesn't require a deposit. Credit is extended based on your creditworthiness. Most credit cards — including rewards cards — are unsecured. Generally requires fair to good credit (580+) to qualify.
- Credit Utilization
The percentage of your available revolving credit (credit cards, lines of credit) that you're currently using. Calculated by dividing your total credit card balances by your total credit limits. Accounts for 30% of your FICO score. Lower is generally better; keeping utilization below 30% is a common guideline, while below 10% is ideal.
Frequently Asked Questions About Secured Credit Card
What does Secured Credit Card mean?
A credit card that requires a cash deposit as collateral. The deposit typically equals your credit limit. Secured cards are designed for people with no credit or poor credit and report to the credit bureaus just like regular cards, making them effective credit-building tools.
Is Secured Credit Card important for my FICO® score?
Understanding Secured Credit Card helps you manage your credit profile more effectively, which in turn supports a stronger FICO® score.