Discover it® Secured Credit Card Review: Improve Your Credit, Earn Cash Back

The Discover it® Secured Credit Card is tailored for individuals building or repairing their credit. It has no annual fee and offers a clear path to an unsecured credit card, but it requires an initial security deposit. The card’s bonus cash back on gas and dining is an extra perk that helps users save while improving their credit.

If you have bad or limited credit, the Discover it® Secured Credit Card is one of the best options available. This card punches above its weight, featuring no annual fee and bonus cash back on gas and dining.

Notably, the Discover it® Secured offers a clear path to potentially upgrading to an unsecured card, which is rare in this category. After seven months of responsible use, Discover automatically reviews your account to see if you qualify for an unsecured card.

The card requires a security deposit of at least $200, which sets your credit limit. This deposit is refundable once you upgrade to a regular credit card or close the account. Despite this initial investment, Discover it® Secured is an exceptional tool for improving or repairing your credit.

>>MORE: MoneyGeek's Best Secured Credit Cards

The Discover it® Secured Credit Card is one of the few secured cards with a cash back feature. With a cash back system similar to the unsecured Discover it® Chrome, it lets you earn 2% cash back on dining and gas on up to $1,000 per quarter. All other purchases get 1% cash back.

Additionally, the Discover it® Secured also has a cash back match feature. This doubles all the cash back you earn for the first year without any limits. If you’ve been able to max out the spending limit on the bonus categories and earn $80, you’ll get an additional $80 back.

The cash back you earn doesn’t expire, and you can redeem it as a direct deposit to a bank account, statement credit or gift card. There’s no minimum redemption amount for most redemption choices, making it easy and flexible to use your rewards.

The Discover it® Secured is excellent for building credit. Its automatic credit review and cash back make it a standout choice.

Automatic Credit Review: Discover automatically assesses your account after seven months to potentially upgrade you to an unsecured card. This gives you a clear timeline for when you can get a regular card and refund your deposit.

Cash Back Rewards: The card lets you earn 2% cash back at gas stations and restaurants (common spending categories for many people) on up to $1,000 in combined purchases each quarter. All other purchases get 1%. It also has a cash back match feature that doubles all the rewards you earn for the first year. This cash back system is similar to what you’ll find with the Discover it ® Chrome, an unsecured card.

No Annual Fee: You can use this credit card without the added cost of an annual fee.

Reports to Credit Bureaus: This card regularly reports to the three major credit bureaus, so responsible use can help you build a strong credit history, paving the way for future financial opportunities.

While the Discover it® Secured Credit Card is a strong contender for credit building, there are some factors to consider before applying.

Security Deposit Required: To open an account, you'll need to provide a security deposit, which will serve as your credit limit. This upfront cost, starting at $200, may be a hurdle if funds are tight. If you’re looking for a secured card with a low-security deposit, the Capital One Platinum Secured Credit Card requires at least $49.

High APR: The card's regular APR is a variable 28.24%, which is on the higher end. If you tend to carry a balance, this could lead to significant interest charges over time. The DCU Visa® Platinum Secured Credit Card can be an alternative, offering a variable APR of 16.75%.

To help you determine if the Discover it® Secured is right for you, we compare it with similar secured credit cards.

The Discover it Secured Credit Card is a solid choice for individuals aiming to improve their credit. It offers a set path for an unsecured card without an annual fee. The card also has a cash back system that offers high rewards for gas and dining, comparable to what you can find on regular credit cards.

However, its minimum security deposit is a bit steep, and its APR can be painful. But if you can front at least $200 and pay off your balance each month, the Discover it® Secured Credit Card stands out as one of the better options in a market filled with less favorable choices.

To evaluate this credit card, we compared it with a pool of similar cards and analyzed its offering according to our rating scale. The weightings used in this score, arranged from highest to lowest percentage, are as follows:

• Cash Back Score (50%): Assesses the value of the rewards program.
• Balance Transfer Offer (10%): A perfect rating in this category indicates an excellent balance transfer option.
• Issuer Satisfaction (5%): Reflects satisfaction scores from cardholders.
• Penalties (5%): Measures the severity of penalty rates and fees.
• Regular APR (5%): Assesses the card's interest rates, with a perfect score indicating a very low APR.
• Foreign Transaction (5%): Evaluates foreign transaction fees, with a top score indicating no fees.
• Annual Fee (5%): Measures a card's annual fees, where a perfect rating means the card has no annual fee.
• Recommended Credit (5%): Indicates how accessible the card is to applicants with various credit scores.
• Intro Purchase Offer (5%): Measures the intro purchase APR offer, with a top score indicating an excellent 0% APR offer on purchases.