secure credit card

A secured credit card is a type of credit card that is backed by a cash deposit from the cardholder, which acts as collateral for the card issuer. This deposit is usually equal to the credit limit on the card and protects the lender in case the cardholder fails to make payments. Secured credit cards are primarily used by people who have poor or limited credit history to build or rebuild their credit scores. They function like regular credit cards, but the cash deposit reduces the risk for the issuer, often allowing easier approval for those with lower credit scores. Over time, responsible use of a secured credit card can lead to improved credit and sometimes the ability to transition to an unsecured credit card.