
What We Do / Research
Secured Credit Cards

Why Secured Credit Cards are a Path to Credit for So Many Americans
Credit history is a critical passport in the U.S. economy. Increasingly, organizations require credit checks for various reasons including job applications, background checks, and underwriting for numerous products and services. However, 121 million Americans are credit challenged with subprime credit scores (68 million) or thin or no credit file (53 million). Our research shows that those without prime credit know the advantages of good credit, but are not sure about how to build it. We know that the secured credit card is an on-ramp to positive credit and a savings tool, but providers have a hard time marketing it and many consumers are not even aware it exists. Providers are missing out on a large portion of the U.S. market because consumers cannot qualify for their products given their current credit score. A secured card can help a consumer to increase their credit score and establish a long-term relationship with a provider.
What is a Secured Credit Card?
Secured credit cards combine the flexibility of a credit card with a forced savings mechanism in the form of a security deposit. The security deposit enables issuers to offer a credit card to someone who otherwise has insufficient or poor credit history. The use of the secured card is reported to the credit bureaus, helping the consumer to build a credit score that will allow access to unsecured credit and other financial products in the future.
Reaching Consumers
We pose several segments that are a good fit for the secured credit card: recent immigrants, people of color, those living in rural communities, military servicemembers and veterans. Each segment faces credit-building challenges that a secured card could address and put users on a path to improved financial health.
Secured cards could benefit millions of Americans, especially those with limited or damaged credit:
- Nearly 10 million Hispanic individuals and 8 million African-Americans who are credit invisible or unscoreable due to lack of sufficient credit history
- Over 1 million military servicemembers and recent veterans have fair to poor credit scores or lack a credit card
- 10 million, nearly a third of adult Americans living outside metropolitan areas, have poor to fair credit scores
- Over 6 million immigrants have fair to poor credit scores or lack a credit card
Visa’s generous financial and strategic support makes our secured credit card research possible.
Secured Credit Cards
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2017 Financially Underserved Market Size Study
The Financial Health Network presents our 2017 Financially Underserved Market Size Study that illustrates the growing opportunity to address the needs of financially underserved consumers and identifies significant trends...
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Secured Credit Cards: Military and Veteran Service Members
Secured credit cards can limit service members’ financial vulnerabilities.
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Secured Credit Cards: Rural, Underserved Communities
Americans in rural communities are losing access to locally available, affordable financial services and products.
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Secured Credit Cards: People of Color
A long history of discrimination and wealth-stripping has caused African Americans, Hispanics, and other people of color to have lower credit scores, less wealth, and less trust in the...
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Secured Credit Cards: Establishing a Path for New Immigrants
Secured credit cards can be an effective way to build U.S. credit history and thereby access affordable credit products and fully benefit from inclusion in the U.S. financial system.
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The Financial Health Network Comment Letter on Information Regarding Consumer Credit Card Market
The Financial Health Network submitted this letter in response to the CFPB's request for information on consumer credit card markets on March 10, 2017. Like the CFPB, the Financial...
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Straight-Talk: Successful Messaging for Secured Credit Cards
Earlier this year, the Financial Health Network worked in partnership with Visa to explore challenges and innovation within the secured credit card market.
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Secured Credit Cards: Innovating at the Intersection of Savings and Credit
This paper takes an in-depth look at new consumer research on secured credit cards. In it, we explore how innovation in secured credit cards can help consumers build credit...
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Hidden in Plain Sight: How Secured Credit Cards Can Build Credit and Engage New Customers
This executive summary examines new consumer research on secured credit cards.
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“VITA Credit Builder” by Mission Economic Development Agency
In 2010, Mission Economic Development Agency (MEDA) launched its Volunteer Income Tax Assistance (VITA) Credit Builder program with the primary goal to establish or improve credit for low-income Latino...
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