Discover it® Secured Credit Card Review
Discover the power of building your credit with the added bonus of earning rewards—all with no annual fee.
Building or rebuilding your credit history can be a daunting task, but the Discover it® Secured Credit Card aims to make this process easier and more rewarding. This secured credit card is designed for individuals with limited or bad credit, providing a straightforward path to improving your credit score while earning cash back on everyday purchases.
Key Features
Card Type: Secured
Annual Fee: $0
Security Deposit: Minimum $200, refundable
Intro APR: 10.99% on Balance Transfers for 6 months
Ongoing APR: 28.24% Variable
Foreign Transaction Fee: None
Rewards Program
The Discover it® Secured Credit Card stands out among secured cards due to its attractive rewards program:
- 2% Cash Back: On up to $1,000 in combined purchases at gas stations and restaurants each quarter.
- 1% Cash Back: On all other purchases.
- Unlimited Cashback Match: At the end of your first year, Discover matches all the cash back you’ve earned, dollar-for-dollar, with no minimum spending or maximum rewards.
Table 1: Rewards Overview
| Category | Cash Back Rate | Quarterly Limit |
|---|---|---|
| Gas Stations and Restaurants | 2% | Up to $1,000 |
| All Other Purchases | 1% | Unlimited |
| First Year Bonus | Dollar-for-dollar match of all cash back earned |
Fees and Rates
Understanding the fees and rates associated with the Discover it® Secured Credit Card is crucial:
- Annual Fee: $0
- Intro APR on Balance Transfers: 10.99% for 6 months
- Ongoing APR: 28.24% Variable
- Cash Advance APR: 29.99% Variable
- Balance Transfer Fee: 3% intro fee, up to 5% on future transfers
- Foreign Transaction Fee: $0
Table 2: Fee Structure
| Fee Type | Amount |
|---|---|
| Annual Fee | $0 |
| Intro APR (Balance Transfer) | 10.99% for 6 months |
| Ongoing APR | 28.24% Variable |
| Cash Advance APR | 29.99% Variable |
| Balance Transfer Fee | 3% intro, up to 5% |
| Foreign Transaction Fee | $0 |
Pros and Cons
Pros
- No Annual Fee: Helps you save money while building credit.
- Rewards Program: Earn cash back on every purchase.
- Credit Building: Reports to the three major credit bureaus.
- Transition to Unsecured Card: Automatic reviews starting at seven months to see if you qualify for an upgrade.
Cons
- High Ongoing APR: 28.24% Variable APR can be expensive if you carry a balance.
- Requires a Minimum Deposit: $200 minimum can be a barrier for some.
- Requires a Bank Account: To fund the security deposit.
Comparison with Other Secured Credit Cards
When deciding if the Discover it® Secured Credit Card is right for you, it’s helpful to compare it to other options:
Table 3: Comparison with Other Secured Credit Cards
| Card | Annual Fee | Intro APR | Ongoing APR | Security Deposit | Rewards |
|---|---|---|---|---|---|
| Discover it® Secured | $0 | 10.99% | 28.24% Variable | $200 minimum | Yes |
| OpenSky® Secured Visa® | $35 | N/A | 25.64% Variable | $200 minimum | No |
| First Progress Platinum Select | $39 | N/A | 19.24% Variable | $200 minimum | No |
FAQ
1. What is a secured credit card?
A secured credit card requires a refundable security deposit, which serves as your credit limit. It is designed to help individuals build or rebuild their credit history.
2. How does the Discover it® Secured Credit Card help build credit?
Discover reports your payment history to the three major credit bureaus (TransUnion, Equifax, and Experian). On-time payments can improve your credit score over time.
3. What happens to my security deposit?
Your security deposit is refundable. Discover reviews your account starting at seven months to determine if you qualify to upgrade to an unsecured card and get your deposit back.
4. Are there any hidden fees?
No, the Discover it® Secured Credit Card is transparent about its fees. There is no annual fee, no foreign transaction fee, and no fee for the first late payment.
5. Can I use this card for international travel?
Yes, the card has no foreign transaction fees, making it a good option for international use.
6. What is the Cashback Match™ program?
At the end of your first year, Discover matches all the cash back you’ve earned, dollar-for-dollar. There’s no minimum spending or maximum rewards.
The Bottom Line
The Discover it® Secured Credit Card is a compelling choice for those looking to build or rebuild their credit while earning rewards. With no annual fee, a generous cash back program, and the potential to upgrade to an unsecured card, it offers substantial benefits. However, consider the high ongoing APR and minimum deposit requirements before applying.
