DiscoverSecured200

Who This Card Is For:

  • Applicants with no credit history or poor credit
  • People who spend a lot on restaurants and gas
  • Anyone who prefers a no-annual-fee card

Discover it Secured Card Overview:

Application

Basics

  • Welcome bonus: Cashback earned in the first year is doubled in the second year
  • Secured card: You need to put down a deposit before spending; your credit limit = your deposit amount
  • Cashback: 2% cashback at restaurants and gas stations, 1% cashback on other purchases
  • No FTF foreign transaction fee
  • No annual fee

Highlights

  • Cashback Match: All cashback earned in the first year is doubled, so during the first year this card effectively earns 4% back on restaurant and gas purchases and 2% back on everything else. For a detailed analysis, see: Discover Cashback Match overview
  • Graduation option: If you use the card responsibly and make on-time payments during the first year, you may later convert it to a regular Discover credit card without needing to keep a security deposit
  • Price protection: If an item you purchased drops in price within a certain period, you can request the card issuer to reimburse the difference
  • Free credit score: You get your real TransUnion FICO credit score once a month, so you can track changes in your credit score. This is one of the best free credit scores offered by banks. For a detailed comparison, see “Which free credit score is the best?”
  • No FTF: Among cards with no foreign transaction fee, Discover uses the UnionPay network in China, making it especially convenient to use there. Many smaller merchants do not accept Visa or MasterCard.
  • Extended warranty: Items purchased with the card automatically get an extra year added to the manufacturer’s warranty.

Drawbacks

  • You need to put down a deposit before using the card. Your credit limit depends on the amount deposited, and you cannot spend above that amount
  • Even though it is a secured card, you still need to provide an SSN when applying

My Take:

This card is best suited for people who want to build credit or rebuild their credit. Because it is a secured card that requires a deposit before use, it is generally easy to get approved for. Once you get the card, using it responsibly and paying on time can help you steadily build credit and improve your score. You can also check your credit score for free every month to keep track of your progress. On top of that, after holding the card for a year, you may be able to “graduate” to the more rewarding Discover it credit card, which is another nice perk.

In addition, this card is one of the best cashback cards in its category. During the first year, thanks to the Cashback Match promotion, it effectively earns 4% back on restaurant and gas purchases and elevated rewards on other spending; after the first year, it returns to the normal 2%/1% cashback structure. That is among the best available for secured cards, since most secured cards usually offer a flat 1% cashback. So if you are deciding among several similar cards, this is probably your best choice.

I personally did not apply for this card, because when I first came to the U.S. and got my SSN, I applied directly for the student version of the Discover it credit card. If you have some income of your own, such as working on campus as a TA or RA, you may be able to skip this secured card and apply directly for the student version. If you apply for the regular version and get denied, you can call Discover and ask whether they can approve you for this secured card instead, then convert it to a regular version in the second year.

Application Link:

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