Discover’s New Secured Card Helps Build or Rebuild Credit
Yesterday, Discover launched its Discover it Secured Credit Card aimed at consumers who want to build or rebuild their credit. The card comes with the same benefits as the Discover it Card, including cashback rewards and free FICO credit scores on monthly statements.
Applicants must provide a security deposit, which is held as collateral. After one year, Discover will review the cardmember’s account to see if they can transition to an account that does not require a security deposit. The analysis is based on credit management across all of the cardholder’s credit cards and loans.
“We know how essential it is to establish a healthy credit history when applying for a car or home loan, an apartment lease, and when determining interest rates on loans,” said Ryan Scully, Discover’s vice president of marketing, in a statement. “Discover wants to help consumers build their credit. Our experience shows that 99% of new Discover it Secured cardmembers who didn’t previously have a FICO® Credit Score received one on their Discover statements within nine months.”
The Discover it Secured Card features 2% cashback rewards at gas stations and restaurants on up to $1,000 in combined purchases each quarter, and 1% back on all other purchases. At the end of their first year, cardmembers can double all cash rewards they earned.
Other Discover it Secured Credit Card features include:
- Reporting to the three major credit bureaus
- Free monthly FICO credit score accessible online and on monthly statements
- $0 Fraud Liability Guarantee, which means cardholders are not responsible for unauthorized purchases
- A Freeze It option accessible on the Discover mobile app or website, which prevents purchases, cash advances and balance transfers if a cardholder misplaces the card