5 Best Secured Credit Cards In Canada (Oct 2022)

September 9, 2022
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There are quite a few good secured credit cards out there, but some stand out above the rest for their low security deposits and credit score requirements, as well as their monthly reports to credit card bureaus. I constantly keep up with all the changes in the credit card landscape and make my recommendations below based on years of experience.

I recommend the Capital One Guaranteed Approval Secured Mastercard as the #1 secured credit card in Canada due to its low annual fee and its very low minimum security deposit. It also has no credit score requirement, allows you to add authorized users at no additional cost, and reports monthly to TransUnion and Equifax.

What Is A Secured Credit Card?

Secured credit cards are a type of credit card for individuals with a bad credit history looking to rebuild their credit score. Credit card issuers can’t take the chance with someone with low credit because they risk not receiving their money back – that’s why secured credit cards require a security deposit before you can start using your card.

Secured cards have a limit built-in – you can’t spend more than you deposited, and you will only get your deposit back if your account is in good standing when you close it. Secured cards usually have low annual fees, and anything above $50 is considered a high fee. Secured cards don’t offer much in terms of perks and benefits other than reporting monthly to the biggest credit card bureaus in Canada, like Equifax and TransUnion. They’re a good option to build your credit, but if you’re looking for the best perks, you may want to look at some premium cards.

Without further ado, here are the best secured credit cards Canada has to offer:

The Best Secured Credit Cards In Canada

  1. Capital One Guaranteed Approval Secured Mastercard: Best for low minimum security deposit
  2. Home Trust Secured Visa: Best for flexibility, choose between no annual and annual fee with better rates
  3. KOHO Mastercard Prepaid Card: Best for earning cash back on all purchases
  4. Plastk Secured Credit Card: Best for generous welcome bonus and interest grace period
  5. Refresh Financial Secured Visa Card: Best for instant approval

Capital One Guaranteed Approval Secured Mastercard

Great for building credit and no foreign exchange fees when purchasing abroad
  • Annual Fee
    $59
  • Interest Rate
    19.80% on purchases, 19.80% on cash advanes
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Minimum security deposit between $75 and $300
    • Get your deposit back in full after you close your account
  • Pros & Cons

    Why we like it

    Great for building credit and no foreign exchange fees when purchasing abroad

    Pros

    • Great for building credit (reports monthly to Equifax and TransUnion)
    • No annual fee
    • No credit card or credit card history checks
    • No foreign exchange fees when purchasing abroad or online
    • Flexible initial deposit ($49, $99, or $200)
    • Add additional authorized users at no cost

    Cons

    • High interest rates on purchase (26.99%)
    • No rewards on purchases
  • More Details

    Bonuses and fees 

    The Capital One Guaranteed Approval Secured Mastercard is a secured credit card targeted at individuals with low credit scores. It charges an annual fee of $59, which is considered high for secured cards, but it comes with some benefits like insurance and travel assistance.

    The Capital One Secured card reports monthly to Canada's two largest credit card bureaus.

    Perks and benefits

    • Guaranteed approval
    • Reports monthly to TransUnion and Equifax
    • Great for rebuilding your credit history
    • Zero liability policy

Home Trust Secured Visa

Great for building your credit and the option to pay an annual fee for reduced interest rates
  • Annual Fee
    $0
  • Interest Rate
    19.99% on purchases, 19.99% on cash advances
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Minimum security deposit of $500 ($10,000 max.)
    • Make purchases over the phone or online
    • Plan and book a vacation
    • Withdraw cash from over 1 million ATMs worldwide
    • Apply even if you declared bankruptcy in the past (A Discharge Certificate is necessary)
  • Pros & Cons

    Why we like it

    Great for building your credit and the option to pay an annual fee for reduced interest rates

    Pros

    • No minimum credit score or credit history requirements
    • Great for building your credit score (reports monthly to Equifax and TransUnion)
    • Option to pay a yearly fee of $59 to reduce purchase interests to 14.90% (from 19.99%)
    • Manage your account and pay bills from Home Trust Visa Online.
    • Sync with online payment platforms like the Apple Pay, Google Pay, and Samsung Pay
    • Fraud protection on all spendings

    Cons

    • Minimum deposit is $500
    • No welcome bonus or reward on purchases
  • More Details

    Bonuses and fees

    The Home Trust Secured Visa is a great way to start building your credit; it reports monthly to Equifax and TransUnion, and it doesn’t have a credit score minimum – virtually anybody can apply and get approved.

    In terms of fees, the Home Trust Secured Visa has two options:

    • Low-Interest Rate Option: $5 monthly fee (or $60/year) plus an interest rate of 14.99% on unpaid balances
    • No Annual-Fee Option: $0 annual fee (free) plus an interest rate of 19.99% on unpaid balances

    The main difference is that for the no annual fee option, you pay higher interest if you fall behind on payments. In general, we recommend the no annual fee option.

    You can start using the card after you make your first deposit; the minimum is $500, and the maximum is $10,000. Keep in mind you will only be able to use as much as you deposit.

    Perks and Benefits

    • Withdraw cash at any time from any Visa ATM worldwide
    • Use your card wherever Visa is accepted
    • You can apply even if you declared bankruptcy in the past
    • Budget your spending by limiting the amount you deposit
    • Completely covered against fraud through Visa’s Zero Liability Policy

KOHO Mastercard Prepaid Card

Great for automatic RoundUps and no annual fees
  • Annual Fee
    $0
  • Interest Rate
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • No foreign exchange fee
    • Price protection
    • Complimentary personalized financial coaching
    • Receive both a physical and virtual card
    • Load funds via e-transfer or direct deposits
    • Sync your KOHO card with Apple Pay, Google Pay, and Samsung Pay and receive real-time spending notifications
    • 10% cash back for 90 days after referring a friend
  • Pros & Cons

    Why we like it

    Great for automatic RoundUps and no annual fees

    Pros

    • 0.5% cash back on all purchases
    • No annual fee
    • Refer friends and earn 10% cash back on all purchases for 90 days
    • Set up automatic RoundUps to grow your savings
    • Track your spending habits in real-time
    • Access your payroll 3 days early

    Cons

    • Low cash back rate plus no bonus points on any category
    • 1.5% forex exchange fees
  • More Details

    Bonuses and fees

    The KOHO Reloadable Prepaid Mastercard doesn’t require a high credit score or a good credit history. This card has no annual fees and is compatible with most other KOHO services: you can manage it from your KOHO mobile app, build your credit, and link it with your KOHO Savings account. Anybody can apply for the card and approve it in just a few minutes.

    Perks and Benefits

    Some of the perks and benefits of this card are a base back on all purchases, a promotional cash back rate at partner stores, and low foreign exchange fees. Here’s the breakdown:

    • 10% cash back at partner stores (online and in-person)
    • 0.5% cash back on all purchases

    Additional benefits include:

    • No hard credit checks
    • No foreign fees when purchasing abroad or online
    • Create a KOHO Save account and start to earn interests on your balance (1.2% APR)
    • Set up automatic RoundUps to grow your savings
    • Reload your card through e-transfers or direct deposits

Plastk Secured Credit Card

Great for building your credit and no-interest period applicable to all purchases
  • Annual Fee
    $120
  • Interest Rate
    17.99% on purchases, 21.99% on cash advances
  • Welcome Bonus
    5,000 pts
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Earn 5,000 Rewards Points as a welcome bonus (redeemable after 3 months)
    • 0% introductory interest rate for the first 3 months
    • Monthly credit reports to Equifax
    • 25 days interest-free grace period
    • Minimum deposit of $300 and up to $10,000
  • Pros & Cons

    Why we like it

    Great for building your credit and no-interest period applicable to all purchases

    Pros

    • 5,000 bonus welcome points
    • Great for building your credit score (reports monthly to Equifax)
    • 0% interest rates for the first 3 months
    • 25 days no-interest period on purchases
    • No minimum credit score or credit history requirements
    • Low annual fee

    Cons

    • Minimum deposit of $300
    • High annual fee
  • More Details

    Bonuses and fees

    The Plastk Secured Credit Card is a premium secured card that offers a lot of perks and benefits for individuals with low credit scores. It has a base annual fee of $48, plus a maintenance fee of $6 per month. This adds up to a total of $120 per year.

    This card has no minimum income or credit history requirement, and you can start using it as soon as you make an initial deposit. The minimum deposit is $300, and you can load up to $10,000.

    Rewards

    Plastk points can be redeemed for merchandise, gift cards, a statement credit, and exclusive events. There’s a base earn rate, applicable across all types of purchases, of 1 point per $1 spent.

    Perks and benefits

    • 25-day interest-free grace period per year (3-days for cash advances)
    • Refer friends to earn bonus points
    • Instant approval
    • No hard credit check
    • Instant Balance Payments via Interac e-transfer

Refresh Financial Secured Visa Card

Great for instant and guaranteed approval and credit score building
  • Annual Fee
    $49
  • Interest Rate
    17.99% on purchases
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • No credit check
    • Guaranteed approval
    • Minimum deposit of $200 ($10,000 max.)
  • Pros & Cons

    Why we like it

    Great for instant and guaranteed approval and credit score building

    Pros

    • No credit card or credit card history checks
    • All your credit card payments are reported to Equifax and TransUnion to help you build your credit
    • Instant and guaranteed approval for all applicants
    • Great for building your credit score
    • Low interest rate of 17.99% on purchases
    • No minimum personal income requirement

    Cons

    • Minimum deposit of $200
    • No welcome bonus
  • More Details

    Bonuses and fees

    The Refresh Financial Secured Visa Card is a secured credit card that offers an easy way to build your credit. It reports monthly to Equifax and TransUnion, and almost all applications are approved instantly. However, you will need to make a $200 deposit.

    This card has a base annual fee of $12.95, plus a maintenance fee of $3 per month. This adds up to $48.95 per year.

    Perks and Benefits 

    • Guaranteed approval
    • No hard credit check
    • All your payments are reported monthly to Equifax and TransUnion
    • Budget your spending by depositing exactly how much you want to spend
    • Deposit up to $10,000 and make everyday purchases

    Signing up for this secured card is very quick, and the application process can be completed online.

How Do Secured Credit Cards Work?

Secured credit cards require new users to provide a security deposit before using the card. This deposit is used to offset the lending risk that credit card companies take by issuing a card to someone with low credit. It also works as collateral and a credit limit; cardholders can never spend more than the deposited money. In general, these cards have no minimum annual income and approve almost all applicants.

Pros & Cons Of Secured Credit Cards

Pros: Why A Secured Credit Card May Be Worth It

  • Great for rebuilding your credit score
  • You can only spend as much as you deposit, no risk of overspending
  • Low-to-no credit score requirements
  • Reports monthly to credit card bureaus

Cons: Why A Secured Credit Card May Not Be Worth It

  • High minimum deposits
  • Very limited perks and benefits
  • Your security deposit is locked in the account until you close it

How To Choose A Secured Credit Card In Canada

Choosing a secured credit card is easy – as long as you know what to look for. Consider all these factors before you choose one:

Credit bureau reporting

The main reason for getting a secured credit card is to build your credit score. First, you should check if the secured credit card reports to the credit card bureau in Canada. The two biggest bureaus in Canada are Equifax and TransUnion – look for a secured card that reports to both.

Annual Fee

Most secured credit cards are very limited regarding rewards, as most people looking for secured cards are usually trying to reduce their spending. Secured cards that offer cash back benefits usually have an annual fee and incentivize spending, which can be counterproductive. Since it’s very unlikely you will make enough from the rewards to pay for a hefty annual fee, make sure to choose a secured credit card that doesn’t charge (or charges a low) annual fee. Anything above $50/year is considered a high annual fee for a secured credit card.

Low minimum deposits

Another limiting factor is the minimum deposit. Secured credit cards provide you with a line of credit that matches your security deposit, but some issuers have very high minimums that can go as high as $500. You may want to look for a card with a low minimum deposit.

Upgrade to an unsecured card

Most secured credit card issuers offer the option to upgrade your secured card into an unsecured credit card after you build up your credit to an acceptable level. When choosing a secured credit card issuer, plan ahead and keep this in mind.

How To Apply For A Secured Card In Canada

Age

In Canada, the minimum age to request a credit card is the age of the majority. Teens under that age can’t get approved for credit cards but can be added as authorized users to one of their parent’s credit cards. For reference, the age of the majority in Alberta, Manitoba, Ontario, Quebec, Prince Edward Island, and Saskatchewan is 18 years old. In all other provinces, the age of the majority is 19.

Residency Status

Canadian credit cards are available to residents and non-permanent residents. However, most premium credit cards require you to be a Canadian resident. You don't even need a credit history for other card types like prepaid and secured credit cards. At the end of the day, residency requirements will depend on the specific credit card issuer and the type of card.

Minimum Security Deposit

Make the minimum security deposit to activate your account. This amount is usually between $200 and $500, and you will get it back after you close your position.

Secured Credit Card FAQs

Are Secured Credit Cards Worth It?

Secured cards might be worth it for you:

  • If you have a low credit score and are looking to rebuild it
  • If you want to limit your spending and are looking for a card that can help you manage your budget

Secured cards might not be worth it for you:

  • If you are looking for a credit card with lots of perks and benefits 
  • If you have a high credit score and can apply for cards with better rewards

What Is The Best Free Secured Credit Card In Canada?

The best free secured card in Canada is Neo Financial Secured Card. It offers a very generous 5% cash back and a promotional 15% cash back when you make your first purchase at Neo partners stores.

How Do I Rebuild My Credit Score In Canada?

Secured credit cards are one of the best ways to rebuild your credit if you make your payments on time. Other ways to rebuild your credit are to limit your number of credit card applications (hard checks will hurt your credit score in the short term), keep your utilization percentage on your credit cards low (less than 35%), and use different types of credit.

Can I Get More Than One Secured Credit Card?

Yes, you can have more than one secured credit card. Usually, having more than one credit card can help you build your credit score by reducing your utilization percentage, but it might be harder to keep track of all your payments.

Is A Secured Credit Card Better Than An Unsecured Card?

Not necessarily. Secured and unsecured credit cards are completely different types of credit cards that will be more or less useful depending on your specific needs.

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