Secured cards are offered by major banks and many finance companies to applicants with poor credit as well as those who are new to credit. This is a convenient tool to be used to make purchases, book a hotel room, for car rentals, emergency situations, and more.
Bank customers are offered plenty of options, depending on their payment history, employment, and other factors. There are secured credit cards to rebuild credit, offered by banks and non-bank providers. Customers can choose from different products offered by American Express, MasterCard, and VISA.
The Best Secured Credit Card Canada Offers
Canadian Banks such as BMO, Toronto-Dominion, RBC, and CIBC offer both secured and unsecured cards to existing and new customers. The HSBC secured credit cards are another option to rebuild credit. While a deposit is required, customers benefit from a lower interest rate compared to some unsecured cards.
RBC Secured Visa
The RBC secured credit card is an excellent choice for newcomers to Canada and enables them to make purchases, pay unexpected expenses, and pay for services. It can be used to shop online, rent a car abroad, pay bills, and more. The limit is equal to the deposit you make (if you deposit $2,500, this is your limit as well).
The RBC Visa Classic Low Rate is a good choice for borrowers who carry a balance. With a low rate and affordable payments, this card is suitable for customers who pay the minimum only. This is also a low-cost card to consolidate existing high-interest balances and save a lot in charges. The interest rate on cash advances is fixed – 11.99 percent.
• Purchase rate: 11.99 percent
• Annual fee: $20
Capital One Secured Card
The Capital One secured credit card offers plenty of benefits as well, including a low annual fee of $29. Customers can choose from different deposit options – $200, $99, and $49. The main benefits are access to a credit tracking tool, regular reporting to the major bureaus, and the option to get a credit line increase with regular payments and responsible use. Capital One offers a secured card by MasterCard, and the same rate applies to cash advances and balance transfers (19.8 percent). The interest rate is variable, and this card helps build history with responsible use and timely payments. It is also offered to borrowers with no credit history. A security deposit is required to guarantee timely payments. The deposit is refundable once you choose to close the account and the balance is paid in full. All payments are reported regularly to the credit bureaus. Emergency cash advances are available.
• Purchase rate: 19.8 percent
• Annual fee: $59
• Credit limit: min $300
The Capital One Low Rate Guaranteed Secured MasterCard comes with a limit of $300 or higher, and the security deposit is between $75 and $300. Standard services such as ATM referral and 24/7 telephone access are also offered. This card helps reestablish credit and save on interest. Standard benefits such as extended warranty and price protection apply. Customers qualify for guaranteed approval provided that they don’t have an account at Capital One and are of legal age. Applicants who have an account in poor standing or have applied for an account with the bank during the past 45 days do not meet the criteria. Guaranteed approval only applies to those who provide security funds:
• Purchase rate: 14.9 percent
• Cash advance rate: 19.8 percent
• Annual fee: $79
Home Trust Secured Visa
Another option is to apply for a Home Trust Secured Visa which is offered to customers, regardless of their payment history. Holders make online purchases and over the phone. They can book a hotel room or vacation, make withdrawals, and shop abroad. There are two options for customers to choose from, with annual fee and with no annual fee. The limit ranges from $500 up to $10,000 and is based on the security deposit required. Home Trust returns the security deposit to customers who cancel their card and pay the balance in full. The deposit can be made in different ways, for example, through bank draft, money order, and personal certified check. There are different options to apply for a secured card – as an authorized user, co-applicant, and primary cardholder.
• Annual fee: none
• Interest rate: 19.99 percent
• Annual fee: $59
• Interest rate: 14.90 percent
Scotiabank Secured Credit Card
The Scotiabank secured credit card also helps users to rebuilt credit and get access to other financial products on the market. The no-fee Scotiabank value visa card is another option for customers who have more limited access to financial products and borrowing instruments. It is offered with a very low introductory interest rate of 3.99 percent. The introductory period is 6 months. The main benefit for borrowers is that customers are able to pay down the balance over a shorter period. There is no annual fee, and along with the low rate, this translates into considerable savings. Scotiabank also offers special discounts such as car rental discounts of up to 20 percent for additional savings. Card checks are also available to transfer high-interest balances on department store and gas cards and save on interest charges. Customers are free to use checks to pay gas, electricity, medical, and other bills and insurance premiums. The bank also provides supplementary cards, and it is easy to apply by phone, online, and in person at a local branch. Applicants are asked whether they have filed for bankruptcy over the last seven years.
• Interest rate: 16.99 percent
• Annual fee: zero
TD Emerald Visa Card
With a limit of $1,000 or higher, this card is ideal for borrowers with no credit exposure or poor history. Consumers benefit from automotive and travel perks and convenient and quick access to cash. Optional travel insurance is available and covers trip cancellation and interruption and medical expenses. The low interest rate translates into considerable savings on cash advances and purchases. There is no annual fee for additional cardholders.
• Interest rate: 1.50 to 12.75 percent + TD Prime
• Annual fee: $25
Secured Credit Cards Application
With secured credit cards Canada based customers benefit from an easy application process. Bank clients are asked to make a security deposit and submit an application form. Issuers require that applicants present details such as their previous and current address, date of birth, and marital status (widowed, separated, common law, divorced, married, or single). Other information to include as part of your application form includes your employment details, including your business phone, employer’s address and name, source of income, and monthly income. Specify your employment status as well, i.e. whether you are retired, student, seasonal worker, full- or part-time, or self-employed. Finally, if you apply together with a co-applicant, you must submit information about the co-applicant as well, including financial and personal details.