The 6 Best Secured Credit Cards in Canada for 2024

Hey there! Are you tired of being turned down for traditional credit cards in Canada because of your less-than-stellar credit history? Well, I’ve got some great news for you. Secured credit cards are the perfect solution for anyone looking to build or rebuild their credit and regain financial stability. And today, I want to introduce you to the best secured credit cards in Canada.

Now, you might wonder, what exactly is a secured credit card? It’s simple! These cards require you to put down a security deposit, which acts as collateral for the lender in case you miss any bill payments. It’s like having a safety net that ensures you can still enjoy the benefits of a credit card, even if your credit history isn’t picture-perfect.

But here’s the thing: not all secured credit cards are created equal. Some offer better features, perks, and lower fees than others. That’s why it’s crucial to know which ones are the best secured credit cards in Canada. And that’s exactly what we’ll delve into in this article.

Here, I’ll share the six best secured credit cards in Canada. I’ll explore their key features, pros and cons, and, most importantly, their minimum security deposits. I want to ensure you have all the information you need to make an informed decision and choose the card that will be a game-changer for your creditworthiness.

So, prepare to take charge of your financial future as we dive into the world of secured credit cards in Canada. Let’s embark on this journey together and find the best secured credit card in Canada that suits your needs. 

Overview of The 6 Best Secured Credit Cards in Canada

The 6 Best Secured Credit Cards in Canada

Whether you’re looking for low fees, attractive rewards programs, or flexible credit limits, we’ve got options that cater to various needs and preferences. These cards have been carefully selected based on their features, benefits, and overall value for cardholders. 

Let’s explore the six best secured credit cards available in Canada

1. Best for Cashback Rewards: Neo Financial Secured Card

• Minimum security deposit: $50
• Annual fee: $0
• Purchase interest: 24.99%
• Income: $50
• Welcome Bonus: $25
• Rewards: Up to 15% cash back

The Neo Financial Secured Card is an exceptional choice among Canada’s top secured credit cards. Its incredibly low minimum security deposit of just $50 sets it apart, making it accessible to many individuals. The application process is straightforward, and approval is relatively easy, making it a convenient option for those looking to establish or rebuild their credit.

But that’s not all! The Neo Financial Secured Card goes above and beyond by offering enticing rewards. With this card, you can enjoy 1% cash back on the first $5,000 you spend each month, allowing you to earn rewards while you build credit. Additionally, when you make purchases from Neo Financial’s retail partners, you can receive an average of 15% cash back—an impressive offer that sets Neo Financial apart from its competitors.

It’s important to note that while the Neo Financial Secured Card offers outstanding rewards, it doesn’t provide insurance coverage typically found with most secured credit cards. However, considering the impressive benefits and cash-back opportunities, the Neo Financial Card remains a compelling choice for individuals looking to improve their credit and maximize their rewards.

Why We Recommend Neo Financial Secured Card

• No annual fee
• Welcome bonus of $25
• You can earn up to 5% cash back when purchasing with select Neo partners.
• A shallow minimum deposit of $50 makes the card accessible to Canadians of all budgets.

Why We Don’t Like Neo Financial Secured Card

• The purchase interest rate goes as high as 24.99%
• Only reports to TransUnion

2. Best for Rewards Points: Plastk Secured Visa Reward Credit Cards

• Minimum security deposit: $300
• Annual fee: $120
• Purchase interest: 17.99%
• Income: $0
• Rewards: 2,500 points ($10)
• Welcome bonus: 5000 points ($20)

The Plastk Secured Credit Card is another top contender among the best secured credit cards in Canada. Plastk offers cardholders a secure credit-building tool and a premium rewards program that sets them apart from the competition.

When you make purchases with the Plastk Secured Credit Card, you earn points that can be redeemed later. This means that as you build your credit, you also have the opportunity to enjoy rewards and benefits along the way. It’s a win-win situation!

But Plastk doesn’t stop there. They understand the importance of reporting your payments to credit bureaus. By doing so, Plastk ensures that your responsible payment behaviour is reflected in your credit history. This is crucial if you want to see your credit score improve over time and increase your chances of being eligible for unsecured credit cards in the future.

So, not only does Plastk provide you with a secure way to build credit, but they also reward you for your everyday purchases and help you pave the way towards a stronger credit profile. It’s a powerful combination that makes Plastk a top choice for individuals looking to establish or rebuild their credit while enjoying the perks of a rewards program.

Why We Recommend Plastk Secured Credit Cards

• You can earn rewards on purchases
• 50000 points for signup bonus (cash value of $20)
• 0% interest for the first three months
• Monthly credit score updates reported to Equifax
• 17.99% purchase interest rate

Why We Don’t Like Plastk Secured Credit Cards

• The interest rate can go up to 29.99% after two missed payments
• Hidden charges to watch out for
• Only reports to Equifax

3. Best for No Annual Fes: Home Trust No-Fee Secured Visa Card

• Minimum security deposit: $500
• Annual fee: $0
• Purchase interest: 19.99%
• Income: $0

One secured credit card that stands out for its user-friendly features and widespread acceptance is the Home Trust No-Fee Secured Visa Card. With this card, you’ll have the privilege of minimum payments that can be conveniently managed, providing you with greater flexibility in handling your finances.

The Home Trust No-Fee Secured Visa card is even more appealing because it is a Visa card. As one of the most recognized and accepted payment networks worldwide, Visa ensures you can use your card for various transactions with merchants.

However, it’s important to note that the minimum deposit required for the Home Trust No-Fee Secured Visa card is relatively higher than other secured credit cards in Canada. While this may influence your decision, it’s crucial to consider the long-term benefits and the potential for building a solid credit history with this card.

Why We Recommed Home Trust No-Fee Secured Visa Card

• No annual fee
• Reports to both Equifax and Transunion
• Low foreign exchange fees of 2%

Why We Don’t Like Home Trust No-Fee Secured Visa Card

• An interest rate of 19.99%
• No rewards or cash back and no perks

4. Best for Low-Interest Rates: Home Trust Secured Visa Card

• Minimum security deposit: $500
• Annual fee: $59
• Purchase interest: 14.90%
• Income: $0

The Home Trust Secured Visa is a no-nonsense option for building credit. It is similar to the Home Trust Secured No Fee Visa Card but has an added annual fee. However, don’t let that deter you, as this card still offers the same level of flexibility, convenience, and easy application process.

Signing up for the Home Trust Secured Visa Card is a breeze. You’re good to go as long as your security deposit is ready. Also, this card is specifically designed to help you build or rebuild your credit history while enjoying the security of a secured credit card.

While the annual fee is something to consider, the benefits of the Home Trust Secured Annual Fee Visa Card often outweigh this factor for many users. It provides a reliable means to showcase your creditworthiness, and by using the card responsibly, you can open doors to future credit opportunities.

Why We Recommend Home Trust Secured Visa Card

• Low-interest rates
• Reports to both Equifax and TransUnion

Why We Don’t Like Home Trust Secured Visa Card

• No rewards on purchases and no cash backs
• You will need to budget for annual fees

5. Best for Interest-free Grace Period: Refresh Secured Credit Card

• Minimum security deposit: $200
• Purchase interest: 17.99%
• Income: $0
• Annual fee: $49

The Refresh Secured Credit Card is another great secured credit card in Canada that offers a straightforward and accessible path to getting your credit back on track. The eligibility requirements are quite accommodating; as long as you’re willing and able to provide a security deposit, you can qualify for this card.

The Refresh Secured Credit Card is appealing because it operates much like a regular credit card. The main difference lies in the security deposit requirement, which is collateral for the card issuer. While secured credit cards typically offer fewer reward programs and benefits compared to unsecured cards, the Refresh Secured Credit Card still provides valuable features that can support your credit-building journey.

Using the Refresh Secured Credit Card responsibly and making timely payments can demonstrate your financial reliability and gradually improve your credit score. The card offers opportunities for credit limit increases, allowing you to access more available credit as your creditworthiness improves over time.

Why We Recommend Refresh Secured Credit Card

• A low purchase interest rate of 17.99%
• Low minimum deposit of $200
• An interest-free grace period of 21 days
• You enjoy free credit reports, financial and educational courses, and weekly updates

Why We Don’t Like Refresh Secured Card

• It cannot be upgraded to an unsecured credit card
• Bogged down with extra fees ($5 for ATM withdrawals)

6. Best for Insurance Coverage: Capital One Guaranteed Secured Mastercard

• Annual fee: $59
• Purchase rate: 19.80%
• Minimum security deposit: $75 – $300
• Income: $0

The Capital One Guaranteed Secured Mastercard offers many benefits and premium perks, making it a compelling choice for individuals looking to build or rebuild their credit.

With an annual fee of $59 and an interest rate of 19.80%, the Capital One Guaranteed Secured Mastercard provides a competitive and affordable option for cardholders. What sets this card apart is its relatively low minimum required deposit, which ranges from $75 to $300. This feature makes it an attractive choice for Canadians who may not have a significant amount of cash to deposit upfront but still want to access the benefits of a secured credit card.

As long as you meet the deposit requirement, your approval is assured, offering peace of mind and accessibility to individuals who may have faced challenges obtaining credit in the past.

By choosing the Capital One Guaranteed Secured Mastercard, you can establish or improve your credit history and access a range of benefits and perks associated with the Mastercard network. From worldwide acceptance to enhanced security features, this card offers convenience and peace of mind in your financial journey.

Why We Recommend Capital One Guaranteed Secured Mastercard

• A low minimum deposit of $75 is affordable to most Canadians
• Lots of insurance benefits, price protection, extended warranty, and travel benefits

Why We Don’t Like Capital One Guaranteed Secured Mastercard

• No rewards on purchases
• The maximum security funds deposit of $2,500 is low compared to what other credit cards offer.

How We Reviewed the Best Secured Credit Cards in Canada

When it comes to reviewing the best secured credit cards in Canada, we understand that simply having a card to build credit isn’t always enough. We believe it’s important to find cards that serve their primary purpose and provide additional benefits and perks to enhance your financial journey.

With numerous secured credit cards available in the Canadian market, it can be overwhelming to distinguish between them. Many cards lack exciting benefits or special perks that set them apart from the competition. While these extra features may not directly impact your credit-building process, they can certainly make a difference in terms of saving money and maximizing your earning potential while improving your credit score.

In our rigorous evaluation process, we carefully selected the six best secured credit cards in Canada based on various factors. One crucial aspect we considered is how these cards help you save money. This includes assessing their low-interest fees, APRs (Annual Percentage Rates), and deposit requirements. By identifying cards that offer competitive rates and reasonable deposit amounts, we ensure that you have the opportunity to build credit without incurring excessive costs.

Additionally, we looked at how these secured credit cards provide you with rewards. While rewards may not be the primary focus regarding secured cards, earning rewards can be a significant advantage. We evaluated the reward programs associated with these cards, considering factors such as cash back, points, or other incentives. By selecting rewards cards, we aim to help you make the most of your credit-building journey and potentially enjoy additional benefits along the way.

How Does Secured Credit Card Work in Canada?

A secured credit card is valuable for building or rebuilding your credit history, especially if you’ve experienced setbacks in the past. Unlike traditional unsecured credit cards, a secured credit card requires a cash security deposit to be made, which then becomes the credit limit for the card.

It’s important to note that different secured credit card providers may require varying cash deposit amounts for different credit limits. A higher cash deposit may sometimes be necessary to secure a lower credit limit. This deposit acts as collateral, providing a sense of security to the card issuer.

Once you’ve been approved for a secured credit card and have provided the required cash security deposit, you can use the card for both online and in-person purchases, just like you would with an unsecured credit card. However, it’s crucial to manage your balance and consistently make the minimum monthly payment. Doing so demonstrates responsible credit usage and prompt payments, which can positively impact your credit score over time.

Most secured credit card providers report your payment history to the major credit bureaus in Canada, namely Equifax and TransUnion. However, it’s worth noting that not all issuers report this information. If your goal is to boost your credit score effectively, it’s advisable to apply for secured credit cards with issuers that do report your payment history to the credit bureaus. This way, your responsible credit behaviour can be recognized and contribute to improving your overall creditworthiness.

Unsecured vs. Secured Credit Cards

When it comes to credit cards, there are two main types: unsecured and secured. Understanding their differences can help you make an informed decision based on your credit situation and financial circumstances.

Unsecured credit cards provide you with a credit limit that allows you to borrow money and pay it back later. The credit card issuer determines the credit limit based on your creditworthiness, income, and other factors. These cards often come with various benefits and rewards, such as cashback, travel rewards, and purchase protection.

On the other hand, secured credit cards work differently. The credit limit for a secured credit card is determined by the security deposit you provide when opening the account. The deposit acts as collateral and ensures that the card issuer is protected if you default on your payments. Typically, the credit limit is equal to or slightly higher than the amount of your security deposit.

While unsecured credit cards offer more benefits and rewards, secured credit cards often have fewer perks. This is because secured credit cards are primarily designed for individuals with bad credit or no credit history. Lenders are generally hesitant to offer unsecured credit cards to individuals with a poor credit history, making secured credit cards a viable option for those looking to rebuild their credit.

Choosing between unsecured and secured credit cards depends on your credit situation and financial circumstances. If you have a bad credit history, we recommend securing credit cards as they provide an opportunity to demonstrate responsible financial behaviour and improve your creditworthiness over time. As you work towards rebuilding your credit, you may eventually qualify for unsecured credit cards with better benefits and rewards.

Benefits of Secured Credit Cards in Canada

• You get an opportunity to build credit and better your credit score.
• The security deposit is what determines the cardholder’s credit limit. This often helps to limit overspending.
• It is easy to get (whether you have good credit or not).
• Some cards provide rewards and cashback.

Downsides of Secured Credit Cards in Canada

• Security deposits may be as high as $500 at a minimum.
• Some cards charge monthly/annual fees
• High-interest rates and fees
• Security deposits cannot be gotten until the account is close
• The terms and conditions are often very stern. For example, some secure credit cards will shut down your account if you pass the credit limit more than once.

What to Consider When Choosing a Secured Credit Card

Several important factors must be considered when choosing a secured credit card in Canada. These considerations will help you make an informed decision that aligns with your financial goals and credit-building journey. Here are key factors to keep in mind:

• Reporting to Credit Bureaus: It’s crucial to check whether the credit card issuer reports your payments to the credit bureaus. Not all issuers do this; reporting is essential for improving your credit score. If payments are not reported, your efforts to build credit may not be recognized. Ensure the issuer reports payments to help boost your creditworthiness.
• Affordable Deposit: Your budget plays a significant role when choosing a secured credit card. The security deposit you provide determines your credit limit. It’s important to consider how much you can comfortably afford to deposit, as you won’t have access to the deposit until you close the account. Avoid depositing more than you can afford, as it may limit your spending capabilities.
• Low (or No Fees): Before finalizing your decision, thoroughly research the fees associated with the secured credit card. Some cards charge annual fees, while others may have monthly fees. Assess your financial situation and choose a card with fees that align with your budget preferences. Look for cards with low or no fees to avoid unnecessary costs.
• Upgrade Potential: Some secured credit card issuers offer the option to upgrade to an unsecured credit card once your credit score improves. This is a valuable feature to consider, as it allows for a seamless transition to a different credit card without switching issuers. Keep an eye out for issuers that provide upgrade opportunities, saving you the hassle of starting from scratch.

How to Make the Most of Secured Credit Cards in Canada

Here are a few key strategies to help you maximise your secured credit card. First and foremost, make sure to pay your monthly bill on time. Timely payments demonstrate your reliability as a borrower and positively impact your credit score. Additionally, aim to avoid interest charges by paying your balance in full each month. This not only saves you money but also shows responsible credit management.

Keeping your balance low is another important factor. Try to use only a small portion of your available credit, known as your credit utilization ratio. Keeping this ratio low indicates that you are not overly reliant on credit and can manage your finances effectively.

Furthermore, it’s essential to use your secured credit card actively. Regular transactions and responsible credit usage help demonstrate your financial responsibility to lenders. By consistently following these practices, you increase your chances of being approved for an unsecured credit card in the future.

Building credit takes time and patience, but secured credit cards provide a valuable opportunity to take control of your financial future. By applying these strategies, you can make the most of your secured credit card and pave the way toward a stronger credit profile.

Final Thoughts on the Best Secured Credit Cards in Canada

When it comes to finding the best secured credit cards in Canada, it’s crucial to consider your unique credit situation and financial goals. These cards can be powerful tools for building or rebuilding your credit, providing a fresh start on your financial journey.

Remember, the best secured credit cards offer features like low fees, flexible credit limits, and opportunities for credit limit increases over time. By choosing the right card and using it responsibly, you can demonstrate your creditworthiness to lenders and open doors to better financial opportunities.

So, whether you’re starting from scratch or looking to improve your credit, don’t hesitate to explore the top secured credit cards available in Canada. Take the first step towards achieving your financial goals and unlocking a brighter future. Get started now and seize control of your credit destiny.