Secured Credit Cards: Unlocking Financial Opportunities for those with limited or poor credit history

Updated for 2026: This post was originally published in 2023. For the latest strategies and a comprehensive guide, see Building Credit in the US as an Expat: The Complete 2026 Guide.

When I first moved from Singapore to the US, I had zero credit history here. Fifteen years of working in advertising, managing teams, handling significant budgets — and as far as America was concerned, I was a financial ghost. It was a humbling experience, to say the least T.T

A secured credit card was my first step back into the financial world, and I think for most expats arriving in the US with no credit history, it will be yours too. Here is what I learned about how they work and how to make the most of them.

How secured credit cards work

A secured credit card works just like a regular credit card — you make purchases, you get a statement, you pay it off. The key difference is that you need to put down a security deposit upfront. This deposit acts as collateral for the bank and typically becomes your credit limit. So if you deposit $300, your credit limit is $300.

Banks like Bank of America and Citi offer secured cards with various deposit options. Both required a minimum deposit of $200 as of March 2023.

The important thing to understand is that the card reports to credit bureaus just like any other credit card. This is the whole point — you are building a credit history from scratch. Every on-time payment counts.

Interest rates on secured cards tend to be high (around 20% per year or more), so I strongly recommend paying your balance in full every month to avoid interest charges entirely.

Choosing the right card

When I was comparing options, I looked at a few things:

Annual fees: Many institutions offer zero annual fees (Bank of America and Citi both do). This matters when you are starting out and every dollar counts.
Interest rates: As mentioned, these tend to be high. The best strategy is to never carry a balance.
Credit bureau reporting: Make sure the card reports to all three major bureaus. Most reputable ones do.
FICO score monitoring: Most reputable institutions offer free FICO score monitoring, which I found really helpful for tracking my progress.
Upgrade path: Some cards offer a clear path to an unsecured card after you demonstrate responsible use. This is what you are working toward.

Building credit with a secured card

From my experience, the strategy is simple (though it requires discipline):

Pay on time. Every single month, no exceptions. Set up autopay if you need to.
Keep your balance low. If possible, pay the full balance before the statement closing date. This keeps your credit utilization ratio low, which is a big factor in your score.
Monitor your credit reports. Check regularly for accuracy and to track your progress.

I wrote a deeper dive into FICO credit scores and their components if you want to understand the mechanics better. And my guide on building credit as an expat covers the full strategy that helped me get my score to 720+ within about five months.

Moving up to an unsecured card

Once you have demonstrated responsible credit behavior — I think six to twelve months is typical — you can start exploring unsecured credit cards. Check directly with your bank about upgrading. Since they already have your payment history, this is often the easiest path.

Before applying elsewhere, review your credit report to make sure it reflects your progress. You have worked hard for those on-time payments — make sure they are showing up :)

Mistakes to avoid

I made a few of these myself (or came close), so learn from my experience:

Do not max out the card. Even though the limit is "your money" via the deposit, high utilization hurts your score.
Never miss a payment. Even one missed payment can set you back significantly.
Do not ignore interest rates and fees. Read the fine print.
Check your credit reports regularly. Errors happen.
Do not apply for too many cards at once. Each application can trigger a hard inquiry.
Do not close the secured card too soon. Length of credit history matters. Keep it open even after you get an unsecured card.

Alternatives if secured cards are not for you

If a secured credit card is not the right fit, there are other options:

Authorized user status on a family member's credit card (if they have good US credit)
Co-signed credit cards (though these are harder to find)
Debit cards (these do not build credit, but they let you participate in the financial system)

FAQs

Do secured cards actually build credit?

Yes — as long as your bank reports your payment history to the credit bureaus. This is the whole purpose of getting one.

How quickly will a secured card build credit?

It varies, but from my experience and what I have heard from other expats, consistent on-time payments and low balances typically show results within 6 to 12 months.

What are the downsides?

Higher interest rates (mitigate by paying in full every month)
Your deposit money is tied up at the credit card company
Low credit limits (since your deposit equals your limit)

Can a secured card hurt my credit?

Yes, if you misuse it — late payments, high utilization, or missed payments will all negatively impact your score. The card itself is not the problem; your behavior with it is what matters.

Does Chase offer a secured credit card?

As of March 2023, Chase does not offer a secured credit card. You can check all of Chase's offerings here.

Does Bank of America offer one?

Yes. Details here.

Does Citigroup offer one?

Yes. The Citi Secured MasterCard is available. Details here.

How much credit does a secured card give you?

Your security deposit typically becomes your credit limit. Deposit $500, get a $500 limit. Check with your specific bank for their exact terms.

How much should I spend on a $200 credit limit?

Try to keep your balance below 30% of your limit — so under $60 on a $200 limit. I know, that is an incredibly small amount, especially with how expensive everything is right now. The workaround: pay off your balance multiple times per month to keep the utilization ratio low.

My honest take

Getting a secured credit card felt like a step backward when I first did it. After years of having premium cards in Singapore, putting down a $200 deposit for a basic card with a tiny limit was... not great for the ego :P

But it works. It is the fastest legitimate way to start building US credit history from nothing. Within six months, I had a credit score that opened doors to better cards, better loan terms, and more financial flexibility. The initial bruise to my pride was absolutely worth it.

Have you used a secured credit card to build your US credit? How long did it take before you upgraded to an unsecured card?

Cheers,

Chandler

P.S. I recently created a group on Facebook called Asian Expats in the US so that we can share and discuss more tips directly. Feel free to join.