Key takeaways

  • The Discover it® Secured Credit Card is a no-annual-fee secured card that offers cash back rewards, making it one of the top secured credit cards on the market.
  • If you're looking to improve your credit score and eventually upgrade to an unsecured Discover card — while still earning rewards for no annual fee — this card could be a good match for you.
  • Discover it Secured may not be worth it for you if you already have good credit, have trouble paying your statements on time, can't afford its minimum security deposit requirement or don't have a bank account.

Bad credit can affect you in many ways — from limiting your lending options to preventing you from renting an apartment or even getting a job, in some cases. Similarly, having no credit history can cause problems because lenders don’t have enough information to judge whether you’ll pay back your loan.

A secured credit card can help you build or rebuild your credit score. The money is secured with a refundable deposit, and your credit limit usually equals your upfront deposit.

In terms of the best secured credit cards on the market, the Discover it Secured Credit Card stands out. With no annual fee and an ongoing cash back rewards structure, it offers more features than other secured cards. Here’s a closer look at the Discover it Secured Credit Card to help you decide if it’s worth adding to your wallet.

When is the Discover it Secured Credit Card worth it?

Before taking out a credit card, you want to ensure it’s the right fit for your situation. Here are a few scenarios where the Discover it Secured Credit Card is worth it.

You want to improve your credit score

No credit score is required when you apply for the Discover it Secured Credit Card. That makes the card a good option for borrowers with minimal credit history or anyone looking to improve their credit score. Discover reports your on-time payment history to the three major credit bureaus, which reflects positively on your credit. Keep in mind, however, Discover also reports payment delinquencies, which will hurt your credit score, so make sure you stay on top of your payments.

You don’t want to pay an annual fee

The Discover it Secured Credit Card doesn’t come with an annual fee, but you will have to pay an upfront security deposit of $200 to $2,500 to “secure” the card; the amount you deposit will equal your initial credit limit. Discover automatically reviews your account after seven months of responsible use to see if you can transition to an unsecured credit card. If this happens, Discover will return your deposit.

You’re looking for cash back rewards

Unlike most secured credit cards, the Discover it Secured Credit Card comes with an ongoing cash back rewards structure. You’ll earn 2 percent cash back on the first $1,000 spent at gas stations and restaurants each quarter (then 1 percent back), as well as 1 percent back on all other purchases.

Even better, Discover offers a Cashback Match™ program to new cardholders: At the end of your first year of card ownership, Discover matches all your cash back earnings. That means if you earn $100 in cash back for the year, the issuer will award you an additional $100.

You want to eventually convert it to an unsecured card

After you’ve been a cardholder for seven months, Discover automatically reviews your account to see if you’re ready to graduate to an unsecured credit card. And you get to keep your same account, avoiding another hard credit inquiry to your credit report.

When is the Discover it Secured Credit Card not worth it?

The Discover it Secured Credit Card is a good choice for many no- or low-credit borrowers, but it won’t be right for everyone. Here are a few situations where the card may not be worth it.

You already have good credit

If you already have a good credit score, the Discover it Secured Credit Card isn’t worth applying for. The card comes with a higher-than-average 28.24 percent ongoing variable APR, and you can get a higher credit limit and better rewards by choosing another option, such as the Discover it® Cash Back.

You regularly pay your bills late

If you can’t manage to make your monthly payments on time, a secured credit card is not going to help you. Because Discover reports your payments to the credit bureaus, late payments could further drag down your score.

You can’t afford the minimum deposit

When you open the Discover it Secured, your credit limit equals your initial deposit. The minimum amount you can deposit is $200, which could be a financial burden.

If you can’t afford the upfront deposit, look into another card that requires a lesser security deposit. For example, the Capital One Platinum Secured Credit Card offers a $200 initial line of credit for a $49, $99 or $200 deposit depending on your creditworthiness.

You don’t have a bank account

You must fund your Discover it Secured card with a bank account, so it isn’t an option for borrowers without banking access. If you don’t have a bank account, you may be better off looking into cards that allow alternative payment methods — though watch for even higher fees. If this is a challenge you’re facing, see our guide to getting a secured credit card with no bank account.

Should you get the Discover it Secured Credit Card?

If you’re looking for an opportunity to build or rebuild your credit score, the Discover it  Secured Credit Card can help you do just that — and while earning cash back rewards to boot. Just make sure you can afford the upfront deposit and commit to making your monthly payments on time.

The bottom line

Before choosing a secured credit card, fully consider the fees, security deposit, upgrade options and any other perks that come with that card.

If you’re ready to apply for this one, see our Discover it Secured Credit Card review to read through the nitty-gritty card details and benefits. If you end up on the fence, there’s always our list of the best secured credit cards to scroll through, updated monthly.