Best Secured Credit Cards in Canada for 2021


Secured Credit Cards 

If you’re trying to build or rebuild credit and don’t think you’ll qualify for a regular credit card yet, you can learn more about secured credit cards below. Secured credit cards work differently than regular credit cards. They have unique pros and cons and additional considerations.

 

 

Refresh Financial Secured Credit Card
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Details
Annual Fee: $12.95
Purchases Interest Rate: 17.99%
Cash Advance Interest Rate: 17.99%
Min Income Requirement: Not Available
Why Apply:
  • Great credit card to establish and rebuild your credit
  • Low security deposit
  • Interest free grace period
  • Lower interest rate
  • Free education to boost your financial skills
Recommended Credit Score:
0 669
Poor or No Credit
Apply Nowlock On Refresh Financial's Secure Website

Refresh Financial offers consumers the simplest way to establish and rebuild their credit with their Secured Visa card. This card is a great fit for consumers with little or no credit, poor credit scores or bankruptcy history because there are no credit checks and minimum income requirements. All you need is a security deposit and you're approved.

  • Great credit card to establish and re-build your credit
  • Lower Interest Rate -The competitive rates will ensure you keep your payments manageable.
  • Free education to boost your financial education - The Refresh (f.i.t.) Financial Intelligence Training helps you increase your financial savvy so that you can be a better money manager.

Refresh Financial Secured Visa Credit Card Review

The Refresh Financial Secured Credit Card allows users to establish and build credit. You will be required to make a deposit to use this financial product. Whatever amount you make as a deposit will become the credit limit. Refresh Financial has a minimum credit limit of $200 and a maximum of $10,000. The interest rate is 17.99% which is slightly lower than the 19.99% industry standard. The annual fee is $12.95 and the monthly maintenance fee is $3 per month.

The main benefit of using Refresh Financial’s secured card is they provide tools that help you actively build credit. There are tools that show your spending and repayment habits and how they impact your credit score. The focus is the utilization rate. By using these tools, you can establish and build credit faster.

Overall it is a great credit card to establish and rebuild credit. It does not require a credit check, making it the perfect card for those with little or no credit, poor credit scores and bankruptcy history.

Home Trust Secured Visa Card
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Details
Annual Fee: $59
Purchases Interest Rate: 14.9%
Cash Advance Interest Rate: 19.8%
Min Income Requirement: Not Available
Why Apply:
  • Easy application
  • No annual fee
  • Flexible credit limit
  • Low minimum payments
  • Monthly reporting
Recommended Credit Score:
0 669
Poor or No Credit
Apply Nowlock On Home Trust's Secure Website

The Home Trust Secured Visa is designed for individuals who need to rebuild or reestablish their credit. It offers easy approval for anyone and gives you a flexible credit limit, ranging from $500 to $10,000, depending on your security deposit. Of course, it also comes with other benefits such as a 21-day no-interest grace period and no annual fee.

Why We Like It:

  • Easy application – Start rebuilding your credit score immediately. Almost everyone is approved for this secured credit card.
  • No annual fee – You pay absolutely nothing to get and use this credit card.
  • Flexible credit limit – From a minimum deposit of $500, you can get a credit limit scaling at 1:1 all the way up to $10,000. The security deposit will also be reimbursed in full (minus the outstanding balance) should the credit card be cancelled in the future.
  • Low minimum payments – If you want to pay the minimum, you can pay whichever is higher: $10 or 3% of the monthly balance.
  • Monthly reporting – Home Trust reports your progress to major credit agencies each month – jumpstarting your credit repair.

The Home Trust secured credit card is an excellent credit card that enables those who do not have a good credit score to rebuild and reestablish it.The card has an interest rate of 14.90% on purchases.

Almost everyone is approved(No credit, poor credit, bankruptcy and  consumer proposal).

To be approved for this secured credit card, the applicants need to provide a security deposit of $500 minimum and be of the age of majority in the province of residence.

This credit card does not offer any rewards but provides purchase protection to insure eligible items against theft or damage for 90 days from the date of purchase.

Each month Home Trust reports to Equifax and Transunion. This will ensure that your payment and credit history related to your Home Trust Secured credit card is updated with the major Canadians credit bureaus accordingly. You will need to make your payments on time each month to rebuild your credit.

Home Trust will give you back your deposit when you close your account.

The Home Trust secured credit card is one of the best cards in the market that can help you build your credit.

No Fee Home Trust Secured Visa Card
lock
Apply Now
Details
Annual Fee: $0
Purchases Interest Rate: 19.99%
Cash Advance Interest Rate: 19.99%
Min Income Requirement: Not Available
Why Apply:
  • Easy application
  • No annual fee
  • Flexible credit limit
  • Low minimum payments
  • Monthly reporting
Recommended Credit Score:
0 669
Poor or No Credit
Apply Nowlock On Home Trust's Secure Website

The Home Trust Secured Visa is designed for individuals who need to rebuild or reestablish their credit. It offers easy approval for anyone and gives you a flexible credit limit, ranging from $500 to $10,000, depending on your security deposit. Of course, it also comes with other benefits such as a 21-day no-interest grace period and no annual fee.

Why We Like It:

  • Easy application – Start rebuilding your credit score immediately. Almost everyone is approved for this secured credit card.
  • No annual fee – You pay absolutely nothing to get and use this credit card.
  • Flexible credit limit – From a minimum deposit of $500, you can get a credit limit scaling at 1:1 all the way up to $10,000. The security deposit will also be reimbursed in full (minus the outstanding balance) should the credit card be cancelled in the future.
  • Low minimum payments – If you want to pay the minimum, you can pay whichever is higher: $10 or 3% of the monthly balance.
  • Monthly reporting – Home Trust reports your progress to major credit agencies each month – jumpstarting your credit repair.

The Home Trust secured credit card is an excellent credit card that enables those who do not have a good credit score to rebuild and reestablish it.

Almost everyone is approved(No credit, poor credit, bankruptcy and  consumer proposal).

To be approved for this secured credit card, the applicants need to provide a security deposit of $500 minimum and be of the age of majority in the province of residence.

This credit card does not offer any rewards but provides a 90 purchase protection to insure eligible items against theft or damage for 90 days from the date of purchase.

Each month Home Trust reports to Equifax and Transunion. This will ensure that your payment and credit history related to your Home Trust Secured credit card is updated with the major Canadians credit bureaus accordingly. You will need to make your payments on time each month to rebuild your credit.

Home Trust will give you back your deposit when you close your account.

The Home Trust secured credit card is one of the best cards in the market that can help you build your credit.

 


What Are Secured Credit Cards?

 

Secured credit cards are credit cards that require a cash deposit to use them. To obtain a secured credit card, you’ll have to deposit a particular amount of money with the credit card issuer. The deposit is typically one to two times the amount of the credit card limit.

 

For example, if you wanted a secured credit card with a $1,000 limit, you would need to make a deposit of $1,000 to $2,000. The deposit is security to the credit card issuer in the event that you do not repay your credit card debt.

 

Who Uses Secured Credit Cards?

 

Secured credit cards are frequently used by individuals who have no credit history or are in the process of repairing their existing credit. Other people who might use a secured credit card are new immigrants to Canada, people who want to conceal a particular purchase or individuals who aren’t old enough to apply for regular credit cards yet. Regardless of who is using a secured credit card, the primary use of them is to show lenders that you can responsibly manage debt.

 

Advantages and Disadvantages of Secured Credit Cards

 

As with all financial products, secured credit cards have their own set of pros and cons. Let’s explore them in depth below.

 

Advantages

 

  • Build or repair credit: If you have poor or no credit history, a secured credit card can help you build or repair your credit. This is a necessary step for individuals with big financial goals, such as to purchase a car or home.
  • Opportunity to obtain a regular credit card: Some secured credit card issuers offer their customers a regular credit card after a certain period of responsible credit management. If your goal is to get a regular credit card, this is a great way to segway.
  • Approval not an issue: Unlike with regular credit cards, there are no approval requirements aside from having a security deposit available.

 

Disadvantages

 

  • Higher interest rates: Secured credit cards have higher interest rates than regular credit cards. Typically, the rate is higher than 20%.
  • Security deposit unaccessible: Once you’ve paid the security deposit, you cannot access the funds unless you hand in the secured card.
  • Setup fees: Some lenders require a setup fee when you first obtain the card. The fee is usually a small percentage of the credit limit, but nonetheless, it's another cost to consider.

 

What Happens to the Security Deposit?

 

More often than not, your security deposit earns interest while you use the secured credit card. So long as you always pay your secured credit card on time and in full, the total security deposit plus earned interest will be returned to you when you hand in the secured card. If you don’t pay your secured credit card on time and in full every month, you’re risking losing your entire deposit.

 

How Long Until I Can Apply for an Unsecured Credit Card?

 

A good rule of thumb is 12 to 18 months, but it really depends on the credit card provider and your credit situation. While you wait, do your best to pay on time and in full every month. You should also take the time to work on your financial habits to ensure that you’re ready for more financial responsibility when you do obtain an unsecured credit card.

 

Is a Secured Credit Card Right for Me?

 

Unfortunately, no one can tell you what’s right for you, you’ll have to figure that out on your own! However, secured credit cards are ideal for those building or rebuilding credit. If you can get approved for a regular credit card, that is a better option which can also help you build or rebuild credit. If not, then a secured credit card is probably best for you. Before making a final choice, assess your finances and determine which credit card type makes the most sense for your circumstances. 

Author Bio

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Mohamed Konate

Mohamed Konate is a personal finance expert, blogger, and marketing consultant based out of Toronto. He is a former financial services professional who worked for many years at major Canadian financial institutions where he managed the marketing strategy around various financial products ranging from credit cards to lines of credit. Mohamed is passionate about personal finance and holds a Bachelor in Business Administration from the University of Quebec (Montreal) and a Master in International Business from the University of Sherbrooke (Quebec).He is also the author of the Canadian Credit Card Guidebook.