Quick Review
The Discover it® Secured credit card is one of our most highly recommendable credit cards for low credit scores or borrowers who are new to credit. Here’s why:
- No annual fee: Many credit cards for low credit scores take advantage of borrowers’ limited options and charge high annual (and sometimes even monthly) fees. Luckily, the Discover it® Secured has no annual fee, so your only upfront cost will come from the security deposit, which can be as low as $200.
- Rewards: It’s rare for a no-credit or bad-credit credit card to offer rewards. Not only does the Discover it® Secured offer 2% back on gas and dining and 1% on everything else, but all new Discover accounts enjoy a first-year cashback match. That means you’re actually earning 2%–4% cash back on purchases by the end of the year.
- Card graduation: This is a card made for building credit quickly so you can move on to better borrowing options. Once you’ve proven a responsible borrower, Discover will graduate you to an unsecured credit card and refund your security deposit in full.
Discover it® Secured Pros & Cons
Who Is the Discover it® Secured Best For?
The Discover it® Secured will best serve the following types of borrowers:
- New borrowers not in school: The Discover it® Secured is a great starter credit card for new borrowers who haven’t established a credit history. However, current students should instead consider a student credit card that doesn’t have a security deposit requirement, as these types of cards also don’t require borrowing histories.
- Casual commuters: While the 2% gas and restaurants rewards rate maxes out at $1,000 each quarter, this means you can still earn $80 back in a year at that rate, and still more at the 1% rate. If you’re frequently driving, these rewards can add up quickly on cutting some of your gas costs.
- Credit builders: Whether you have no credit history or a low credit score, the Discover it® Secured offers a chance for borrowers to build a positive credit history. A flexible security deposit and comprehensive credit reporting can help improve your credit score quickly (assuming you use your card responsibly).
If you don’t fit into any of the above categories, you may want to check out some comparable cards below.
Rewards
Here’s how the rewards program on the Discover it® Secured credit card works:
- 2% cash back on gas and restaurant purchases (up to $1,000 in combined spending each quarter, then down to 1% back)
- 1% cash back on all other purchases
While the quarterly cap limits how much you can earn in the 2% category, any rewards are a major benefit on a credit card for building credit.
How Much You Can Earn
Using real-life data, we’ve estimated how much the average spender can earn using the Discover it® Secured. Here’s an idea of what you can earn in cashback rewards on the card:
| Rewards category | Rewards rate | Annual spending | Annual earnings |
|---|---|---|---|
| Gas & restaurant | 2% | $3,546 | $70.92 |
| Everything else | 1% | $2,400 | $24 |
| Total: $94.92 |
This is just an idea of what you can earn based on average American spending data. If the numbers seem high or low compared to your own spending, adjust accordingly to better assess what kind of rewards you can expect. If you’re a high spender in the gas and dining categories, remember that your quarterly earnings max out at $20 at the 2% cashback rate.
Rewards Redemption
You can redeem your cashback rewards in any of the following ways:
- As statement credits
- As an electronic deposit to a checking or savings account
- As a charitable donation
- To pay for purchases with select merchants
- As gift cards (starting at $5)
Welcome Bonus
Like on all new Discover credit card accounts, the Discover it® Secured gets the Cashback Match welcome bonus in the first year of borrowing. With this bonus, all of your rewards earnings in the first year of borrowing will double.
So if you earn the $94.92 estimated above, that will double to $189.84 at the end of the first year.
Rates & Fees
Fees
- Annual fee: $0
- Foreign transaction fee: None
- Cash advance fee: 5% or $10 (whichever is greater)
- Balance transfer fee: 5%
- Intro balance transfer fee: 3%
- Late payment fee: Up to $41 (first late payment fee waived)
Interest Rates
- Purchase APR: 25.99% (variable)
- Balance transfer APR: 25.99% (variable)
- Intro balance transfer APR: 10.99% for 6 months
- Cash advance APR: 27.99% (variable)
- Penalty APR: None
Benefits
Credit Limit
The Discover it® Secured card’s credit limit is between $200–$2,500. You’ll need to put down a security deposit within this range, then your card will have an equivalent credit limit.
Card Graduation
One of the best perks of the Discover it® Secured is that it allows you to graduate to an unsecured credit card and have your security deposit refunded in full. To qualify for card graduation, you’ll need to use your card responsibly and pay your bills on time.
Discover will start automatically reviewing your account for graduation after you’ve had the card for 7 months.
If you graduate, you’ll be given a Discover it® Chrome Gas & Restaurant credit card.
Protections
The Discover it® Secured card offers the following privacy and liability protections:
- $0 fraud liability guarantee
- Social Security fraud alerts
- Card freezing
- Online privacy protection (which removes you information from popular data-selling sites)
- US-based customer service
Free Credit Scores
Through your Discover app, online account, or monthly statement, you can view your FICO score for free and without hurting your credit. This is a great way to track your credit-building progress.
Cash Advances
You can take out cash advances with a Discover it® Secured, meaning you can withdraw money from the card at an ATM. Each cash advance will be charged a fee of $10 or 5% of the advance amount. What you withdraw will also begin accumulating interest immediately at an APR of 27.99% (variable).
Cash advances are very expensive, so we recommend only making them in case of an emergency.
Balance Transfers
You use your Discover it® Secured to consolidate credit card debt through a balance transfer. The card offers a reduced introductory APR for balance transfers of 10.99% for 6 months after the date of your first transfer. After the intro period expires, your balance will be subject to an APR of 25.99% (variable).
There’s also a reduced balance transfer fee of 3% of the transferred amount. Given the reduced fee and rate, this card may be useful for moving debt from another credit card—so long as you have a high enough credit limit and can pay off the debt within 6 months.
Authorized Users
To add an authorized user to a Discover credit card, you can submit an application online. The user must be at least 15 years old. Discover will not charge an authorized user fee or extra card fee.
Remember that it’s the primary cardholder’s responsibility to pay the card’s bill each month, so only add an authorized user you trust.
How to Get a Discover it® Secured Credit Card
Credit Score Required
We recommend borrowers with credit scores between 300–669 apply for the Discover it® Secured credit card.
Discover advertises the Discover it® Secured as a credit card for people new to credit or who are trying to rebuild their credit scores. This means lower credit scores or limited credit histories may qualify, including scores in the “bad” range (FICO scores under 580).
Application Requirements
To qualify for the Discover it® Secured credit card, you must meet the following requirements:
- Be 18 years of age or older
- Have a Social Security number
- Have a US address (P.O boxes likely not allowed)
- Have a US bank account
Discover also advises you to have your bank account number and bank routing number on hand when you apply, so you can transfer the funds for your security deposit.
Pre-Approval
Discover offers pre-approval for the Discover it® Secured card. The pre-approval process won’t impact your credit score, but will determine how likely you are to qualify for the card and what terms you may be offered.
We strongly recommend going through the pre-approval process before submitting a formal application. Once you apply, Discover will perform a hard inquiry, which will take some points off your score. If pre-approval determines you unlikely to qualify, we recommend seeking other options instead of damaging your credit score.
How to Apply
You can apply for the Discover it® Secured credit card online. You’ll need to fill in the required information and potentially pay your security deposit through an online bank transfer.
If you have questions about the card or the application process, you can call: (800) 315-1776
Building Credit with a Discover it® Secured Card
The Discover it® Secured is a great option for new borrowers and those with damaged credit scores who want to build credit, as it reports to the major credit bureaus and offers a flexible security deposit.
Security Deposit
You can put down a security deposit between $200–$2,500 to get an equivalent credit limit on a Discover it® Secured card. Discover will also let you apply for credit limit increases. If your increase request is approved, you can add funds to your security deposit for a higher limit. 1
Credit Reporting
Every month, Discover will report your borrowing activity to the three major credit bureaus—Equifax, Experian, and TransUnion. They report on the last day of the billing cycle, which is your statement closing date.
Tips for Building Credit
To build credit with the Discover it® Secured card, follow these steps:
- Put down a healthy deposit: Luckily, the Discover it® Secured offers a flexible security deposit range of $200–$2,500. You want to put down a deposit high enough to accommodate your spending without maxing out your card, but not so high that you accidentally spend more than you can pay back.
- Use your card responsibly: A factor that determines your credit score is your credit utilization rate, which is essentially how much of your available credit you’re using. If you use too much of your credit line, your rate will be high and might make building a good credit score more difficult. So try to borrow well under your credit limit.
- Pay on time: The most important part of building credit is to pay your credit card bill by the due date each month. Paying your balance off early may help raise your credit score even faster. Discover reports your account details on your statement closing date, so having a low balance on that day will reflect well on your credit report.
Comparable Cards
See how the Discover it® Secured compares to similar cards on the market.
