When you don’t have a good credit score, or you have little or no credit history, using a credit card responsibly is a great way to build your credit over time. The issue? Bad or nonexistent credit history makes it much harder to be approved for a card in the first place.

So how do you get yourself on the path to raising your credit score? One way is to apply for a secured credit card. Here’s how it works:

Get Approved and Provide A Security Deposit

Start by applying for the card and providing a security deposit. In the case of the Discover it® Secured Credit card, your credit line will be created up to the amount we can approve (and getting the card isn’t guaranteed—your application can be turned down). In other words, if your security deposit is $500, your credit limit is also $500.

Use Your Card Responsibly

Once you’re approved and receive your card in the mail, it’s important to use your credit card responsibly. Your secured credit card is a real credit card, not a debit or prepaid card. Using your secured credit card will build a credit history with the three major credit bureaus. If you use your secured card and other loans responsibly, you can build positive credit history. Late payments, delinquencies or other derogatory activity with your credit card accounts and loans may adversely impact your credit. Start by charging small and manageable amounts, and pay every bill on time and in full.

Apply to Increase Your Credit Line

If over time you find that you need a higher credit limit, you can apply for a credit line increase and deposit additional money from your bank.

Transition to an Unsecured Card

Some secured card issuers will periodically review your account to see if you qualify for an unsecured card. With Discover, after 8 months with your secured credit card, your account will be reviewed monthly to see if you can get your security deposit back and graduate to an unsecured account. Nothing else changes with your Discover card, so your rewards transfer over, too.

How the Discover it® Secured Credit Card is Different

The Discover it® Secured Credit Card is one of the few secured cards that offers rewards. 2% Cashback at restaurants or gas stations on up to $1,000 in combined purchases each quarter. Plus 1% cash back on all other credit card purchases. At the end of your first year, Discover will automatically match all the cash back you’ve earned at the end of your first year on your credit card – only for new cardmembers.

secured credit card can build credit history


Cashback Match: We’ll match all the cash back rewards you’ve earned on your credit card from the day your new account is approved through your first 12 consecutive billing periods or 365 days, whichever is longer, and add it to your rewards account within two billing periods. You’ve earned cash back rewards only when they’re processed, which may be after the transaction date. We will not match: rewards that are processed after your match period ends; statement credits; rewards transfers from Discover checking or other deposit accounts; or rewards for accounts that are closed. This promotional offer may not be available in the future and is exclusively for new cardmembers. No purchase minimums.

Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.