Updated Feb 10, 2021 | Published Feb 07, 2020 • 9 min read
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One of the best secured cards on the market, the Discover it Secured offers benefits and rewards while helping you rebuild or establish your credit history.
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Secured cards require a security deposit when you’re approved for the account. They’re meant for people with limited or bad credit, meaning a FICO Credit Score of around 660 or below. You’ll need to make a deposit to get this card, but there is no annual fee after that.
This card is designed to help you improve or rebuild your credit, and it reports to all three of the major credit bureaus. So as long as you use it responsibly, you’ll be adding more positive activity to your credit reports.
The Discover it Secured is one of the better offers because it provides a lot of cash back compared to other secured cards. That’s especially true because Discover will double what you earn in your first year. You’ll get a few handy benefits from Discover, including the ability to check one of your FICO credit scores.
Is this card right to help you improve your credit? Read our comprehensive review to find out.
Discover it® Secured
Min. credit levelBad
Regular APRSee Terms
Our Rating: 5 Out of 5 Stars
We gave the Discover it Secured 5 out of 5 Stars because it has favorable terms and provides a surprising amount of cash back. When it comes to cards for people with poor credit, this is a rare find.
Why We Like It
2% cash back at gas stations and restaurants (many secured cards offer no rewards at all)
Double cash back in your first year
Chance to earn your security deposit back through responsible credit use
2% cash back rewards are limited to the first $1,000 spent per quarter
Lackluster set of extra benefits
Insider Advice: Getting the Most Out of Your Card
Build your credit history: Use this card responsibly to add positive activity to your credit reports. Don’t charge more than you can pay for, pay your bills on time, and don’t go over your credit limit. We recommend you always pay off your balance in full, to avoid interest and improve your credit as quickly as possible.
Monitor your credit: Discover’s FICO Credit Scorecard can help you get a good understanding of your credit, and monitor it as it changes over time. Discover will provide specific tips to help you improve based on your account activity, so read through them carefully.
Make a large security deposit: The more you can put down for the security deposit, the larger your credit limit will be. A larger credit line can be better for your credit. It will also make spending easier because you won’t have to worry as much about hitting the limit.
Get your deposit back: Discover will review your account every eight months. If you’ve been managing your credit responsibly, they’ll consider returning your deposit and letting you continue to use the card. Discover will review your overall credit history, not just this card.
For gas and dining: Use this card to earn 2% cash back at gas stations and restaurants, unless you can earn more with a different card. This is a great deal compared to most secured credit cards. Discover will even double your rewards in the first year!
Redeem for gift cards, statement credits, or direct deposits: Redeem your cash back for gift cards whenever possible because you’ll get at least $5 added to the redemption. Or, redeem it for statement credits or as direct deposits.
Be wary of the balance transfer offer: Avoid the balance transfer offer with this card, of See Terms for See Terms. You could use this to transfer a balance away from an account with a higher balance if necessary. But it would be better to use a different balance transfer card, offering 0% APR for a longer period.
The Security Deposit
This is a secured credit card, which means you’re going to need to put down a refundable security deposit when you’re approved. Your credit limit will be equal to the amount of your deposit.
A minimum deposit of $200 is required. Your maximum credit limit will be determined by your credit history, along with your income and ability to pay. The maximum security deposit and credit limit possible is $2,500.
You’ll receive your security deposit back when or if you close out the card. Discover will also check your account and credit in general every eight months for responsible behavior. If they like what they see, they may refund your security deposit.
The Discover it Secured earns 2% cash back on gas and restaurants, and 1% everywhere else. That alone makes it pretty rewarding as far as secured cards go, but to make it even better, Discover offers its Cashback Match for your first year.
That means during those 12 months, you’ll actually earn 4% and 2% respectively, making this card that much more rewarding.
2% cash back on up to $1,000 spent per quarter at:
1% cash back on all other purchases
Introductory Bonus Offer
Cashback Match: Double all cash back earned in the first year; awarded at the end of the first year
The cash back you earn won’t expire, and you can earn an unlimited amount.
The fact that Discover will double what you earn is a great deal, meaning you’ll get 4% cash back at restaurants and on gas, and 2% cash back on all other purchases for that first year. The amount of cash back you can earn makes this one of the most rewarding secured credit cards available. Your bonus cash back will be awarded after the end of your first year with the card.
Discover will always provide at least $1 for every $1 in cash back that you’ve earned, no matter how you redeem your rewards. Other card issuers have some options that are less rewarding than others, so this is a nice feature.
You’ll have five different options for redeeming your cash back:
As a statement credit to reduce your balance
Directly into a bank account of your choice
For gift cards
As a charitable donation
Pay with rewards at select retailers, like Amazon.com
The gift card option will offer a bonus on your redemptions of at least $5, so use it first whenever possible.
Statement credits and direct deposits are both easy ways to redeem your cash back. A statement credit will lower your card’s account balance, while a direct deposit will be sent to your bank account.
We recommend always using one of the first four options above, and avoiding number five. If you use your cash back for Amazon purchases you won’t earn any rewards, so it’s better to just pay with your card as usual.
FICO Credit Scorecard: Access your FICO Score 8 whenever you’d like for free, based on your TransUnion credit report.
Cash at Checkout: At eligible retailers you can get cash at checkout, a handy way to get some money without going to an ATM. The extra cash will be counted as part of your purchase.
Refer a Friend bonus: Earn a $50 statement credit bonus for every friend you refer who’s approved, up to 10 friends per year. If your friend makes a purchase within three months of opening the account, he or she will earn a $50 bonus too.
$0 Fraud Liability Guarantee: If your card is lost or stolen, you are not liable for any fraudulent charges made to your account. Contact customer support immediately if you suspect fraud.
Fraud Protection: Discover monitors your account around the clock for suspicious or unusual activity.
Free Social Security number alerts: Discover searches for your Social Security number on thousands of risky sites and will alert you if your information was compromised.
New account alerts: Get notified of credit inquiries and new accounts on your Experian credit report
The Terms & Fees
Balance Transfer APR
Cash Advance APR
Minimum Security Deposit
Maximum Security Deposit
See Terms for See Terms, then See Terms
Foreign Transaction Fee
Balance Transfer Fee
Cash Advance Fee
Returned Payment Fee
There’s no annual fee to pay, just the security deposit as described above. You’ll get a balance transfer offer with this card, but we don’t recommend using it. Check out our picks for the best balance transfer credit cards if you’re looking to move a balance away from an account with high interest.
This card is pretty forgiving — there’s no penalty APR for paying late, and no fee for the first late payment. These are surprisingly good features to find on a secured card.
The Bottom Line
The Discover it® Secured is one of the best secured cards available today. While most secured cards tend to come with penalties for having poor credit, this card actually has a number of benefits with no real penalties.
The cash back program is actually very good, even compared to many non-secured cards. The fact that Discover will double the cash back you earn after a year really puts this card over the top when it comes to the rewards. But you won’t get much in the way of extra perks.
The regular purchase APR may seem high, but this is expected for secured credit cards. And, you can avoid paying interest if you simply pay off your entire balance every month by the due date. So the interest rate shouldn’t worry you too much.
Depending on your creditworthiness, you’ll be required to make a deposit of either $49, $99, or $200, which will fund your credit limit. You’ll need a bank account in order to make the deposit. Uniquely, however, no matter what you’re required to pay, your starting line of credit will be $200. You could also pay more than that to increase your credit limit, up to $1,000.
You may be automatically considered for a higher credit line after six months. You won’t need to make any extra deposit for this. This is a great feature for secured cards, which tend to have very low credit limits.
The Secured Mastercard from Capital One wins when it comes to extra benefits, which include an Extended Warranty, Price Protection, Auto Rental Insurance, and others; these can be pretty useful. However, you won’t earn any rewards like you would with the Discover it Secured. So in that sense the Discover card is the more valuable option, but the Capital One card can still be a good way to improve your credit.
The most notable features here are the terms, which are much better than most secured cards. The APR for purchases, balance transfers, and cash advances is very low. There are also no fees for balance transfers or cash advances.
However, one thing it seems to lack is the ability to monitor your credit score. This is a very useful feature to have on secured cards, which are meant to help people build their credit. The DCU card won’t help you do that. But you could still use Discover’s FICO Scorecard to check your credit, even if you don’t have a card through Discover.
This is a very simple card, without any bells and whistles. But for people with poor or no credit, it can be a good way to establish a positive credit history. You’ll need to open a bank account with DCU when you’re approved, but this can be done with as little as $5. If you can’t get the Discover it Secured, DCU provides another decent option.
The Citi® Secured Mastercard® (Review) is a simple and inexpensive secured card that can help you build credit like any other. But it does have one rare feature: You can apply for it and fund the deposit even if you don’t have a bank account, but only if you visit a Citibank location.
This card requires a security deposit of $200 to $2,500, and your credit line will be equal to your deposit. There’s no annual fee, but there are no rewards either.
With responsible credit behavior, Citi may return your deposit and upgrade you to a different unsecured card.
Brendan has been writing about personal finance for over eight years, and is now taking on the challenge of bringing high quality credit education to the masses. He makes sure that Credit Card Insider is covering the most important credit topics transparently and precisely, and that we have up-to-date reviews of credit cards so you can find cards that are right for you.
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