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How to Choose the Right Secured Credit Card

Without a credit card, life can be a whole lot tougher. Whether it’s making an online purchase, renting a car, or securing a reservation, many everyday transactions seem to require a credit card, even if you have the cash in hand. 

If you’re in a consumer proposal or have a poor credit rating and fear being turned down for a credit card, don’t panic. A secured credit card may offer you the flexibility you need and a chance to get your credit score back on track. 

Want to get an expert opinion on which secured card is best for your situation? Contact us for a free credit consultation and our expert consultants will recommend the secured Visa card or secured Mastercard you’re most likely to qualify for. Note: this post contains affiliate links marked with a *. Climb may receive a commission for signups made through these links.

What is a secured credit card?

A secured credit card is a type of credit card that allows you to access the benefits of a credit card, even if you’re in a consumer proposal or you have a low credit score. 

A secured credit card, like it’s name suggests, requires a security deposit. This is usually around 1-2 times the limit you’re applying for. For example, if you’re applying for a $500 limit, you’ll give the lender $500-1000 as a deposit. 

That means the lender takes on less risk: if you fail to pay back what you owe, they’ll use your deposit to clear that debt. 

The real long-term value of a secured credit card lies in its ability to help rehabilitate your credit score. Unlike a prepaid credit card, your lender will report your payments to credit agencies, meaning using a secured credit card will build a positive payment history, which can help you improve your credit score. Having a “revolving” form of credit on your credit report is one of the best ways to rebuild your credit, especially if it’s paired with an “installment” form of credit like a Climb Accelerator Plan. Learn more about the different types of credit here, or talk to one of our credit consultants about your own credit rebuilding goals.

Factors to consider when comparing secured credit cards 

As with any financial product, it’s important to understand what you’re signing up for when you take on a secured credit card. Here are some questions you’ll want to ask. 

1. What are the fees?

It’s relatively easy to find out whether the card you’re applying for has annual fees or not. 

But look out for other hidden fees, such as fees for foreign transactions, cash advances, declined transactions or going over your limit. One popular card advertises a low annual rate but then tacks on a monthly fee. You should ask to see a full fees schedule before you commit to a card and make sure the fees will be manageable for you. 

2. What’s the interest rate?

Secured credit cards typically have higher interest rates than a standard unsecured card. However, if you intend to avoid carrying a balance on your card this may not pose too large a problem. We recommend treating your secured credit card like a debit card and paying it off in full every month.

3. How much is the deposit and what happens to it?

Most cards will have minimum and maximum deposit requirements. Make sure you can afford the minimum deposit and that you understand how the deposit relates to the amount of credit that will be available to you. 

While you use your secured credit card, you won’t have access to the funds you’ve deposited and the deposit can’t be applied to your monthly payments. However, if you’ve paid your bills on time and in full, your deposit will be refunded to you when you close your account. 

Which is the right secured credit card for me?

Making the right choice of secured credit card will depend on your financial situation. Here are some of the options available to Canadian borrowers with a comparison of their different features and benefits. 

Home Trust Secured Visa


 No Annual Fee

Other fees include:

  • Overlimit fee: $29.00
  • Dishonoured cheque fee: $45.00
  • Inactive account fee: The lesser of $10.00 or the full account balance if the account has been inactive for 360 days
  • Foreign currency conversion fees: 2%
  • ATM Charges: $2.50 for up to $250 cash advance within Canada—fees are higher internationally
Interest Rate  19.99%
Minimum Deposit  $500
Monthly Minimum Payment  3.00% or $10 (whichever is larger). 


Home Trust Secured Visa offers a great no annual fee option. The minimum deposit starts at $500 and maxes out at $10,000. The amount of credit available to you scales directly with the amount of your security deposit: so if you put $500 down, you receive $500 worth of credit

While Home Trust does require a credit check as part of their application process, the card has a high approval rating, and a low credit score is not usually associated with rejection. The catch is that you need to send a physical cheque to their office with your security deposit, which can be inconvenient.

The card offers the worldwide flexibility of the Visa brand, as well as an interest-free grace period of 21-days.  You can apply directly here.*

Home Trust Secured Visa (Annual Fee Option)


$59.00 annual fee (or $5 per month)

Other fees include:

• Additional authorized user fee: $19 annual fee (or $2 a month)
• Overlimit fee: $29.00
• Dishonoured cheque fee: $45.00
• Inactive account fee: The lesser of $10.00 or the full account balance if the account has been inactive for 360 days
• Foreign currency conversion fees: 2%
• ATM Charges: $2.50 for up to $250 cash advance within Canada-fees are higher internationally

Interest Rate  14.90%
Minimum Deposit  $500
Monthly Minimum Payment  3.00% or $10 (whichever is larger).


Almost identical to their no-fee option, the annual fee Home Trust Secured Visa has the benefit of one of the lowest interest rates available with a secured credit card. If you think you may carry your balances forward, this may be a better fit for you, so long as the fee is manageable.  You can apply for the HomeTrust Secured Visa Card here.*

Refresh Financial Secured Visa


$12.95 annual fee

$3 per month maintenance fee

Other fees include:

• Declined transaction: $0.10
• ATM Charges: $5 cash advance fee in Canada
• Overlimit fee: $5 for first time—additional times will result in the cancellation of your card
• Foreign Transaction Fees: 3.5%
• Inactive fee: $2 per month for each month you don’t use your card

Interest Rate  17.99%
Minimum Deposit  $200
Monthly Minimum Payment  Information not publicly available


Refresh Financial’s Secured Visa offers a secured credit card with a minimum deposit of just $200. It allows deposits up to a maximum of $10,000 and provides a comparable interest rate to other secured cards. This card offers a 21-day interest-free grace period on your transactions. 

This card requires no credit check and so your application is virtually guaranteed to be approved provided you meet the eligibility criteria and can provide the deposit. 

Capital One Guaranteed Secured Mastercard


$59 annual fee

Additional fees may apply

Interest Rate  19.8%
Minimum Deposit  $75-$300
Monthly Minimum Payment  Information not publicly available

Capital One’s Guaranteed Secured Mastercard promises that as long as you meet their conditions, you’ll be approved for a card. Capital One will set your credit limit and then require a deposit of either $75 or $300 based on that limit. You can increase your limit up to $2,500 by increasing the size of your deposit. 

With your Capital One Card you also receive Mastercard Global Services and Zero Liability protection for unauthorized purchases. Capital One also allows you to add an additional authorized user with no fees. 

Still have questions?

Grappling with secured credit cards when you’re in a consumer proposal can be a headache. If you have more questions about your credit score, its impact on your ability to get credit, and the options you have available to you, book a free credit consultation with one of our experts. We’ll help you explore your options and get your credit score back where it belongs.


Author: Climb

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