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Canada’s Top Ten Secured Credit Cards

By Sam 21 Comments

When it comes to considering secured credit cards in Canada, you have quite an array of options to choose from. They come with different interest rates, annual fees, rewards, benefits, and minimum deposits. Here are some factors to consider regarding guaranteed credit cards, and a side-by-side comparison of Canada’s top ten!

What is a Secured Credit Card?

A secured, or guaranteed, credit card works on the same principle as a secured loan. With a secured loan, the lender has some tangible guarantee (like a home or car) that can be taken as collateral if the borrower should default on the loan. That’s why mortgage companies and lenders are willing to loan out large sums of money to people—because they know they’ll get either the money (and interest) in payment, or else they’ll get the property that was put up to secure the loan.

In the case of a secured credit card, the collateral is a sum of money you deposit when you are issued the card. The lender can be confident that you’re not a risk, because they already have your money in hand.

What Are Secured Credit Cards Good For?

So why even get a secured card? If you have the cash-in-hand sufficient for a deposit, you could just use your cash, right? Well, maybe not. You can’t use cash to purchase merchandise online, to make reservations, or even to pay some bills. Where a check or credit card is required, you’ll be out of luck if you don’t have a bank account or a card.

If your poor credit prevents you from qualifying for a regular credit card, or if you don’t yet have a credit history in Canada, you can still enjoy the convenience of paying for goods and services that require credit cards. You can also use that card to build (or rebuild) that credit score so you qualify for bigger things in the future.

Rebuilding Your Credit with a Secured Credit Card

If you’re looking to repair your credit rating, a secured credit card is one of the best tools at your disposal. You might think it’s wiser to “play it safe” and use cash, but that actually hurts your credit score. You actually need credit transactions in order to build up your score, so it’s important to use your secured card with intentional care.

Make sure that you make all your payments on time. That’s the number one thing you can do to repair your credit. A late payment of even a few days will undo a lot of your work toward credit repair. After a period of time making punctual payments, however, you will see your credit score improving visibly.

Top Canadian secured credit cards

Peoples’ Trust Secured Credit Card

* Annual fee: $70
* Interest: 12.99% on purchases, 24.5% on cash advances
* Minimum required deposit: $500
The relatively low interest rate on this card makes it attractive to people who might be carrying a balance on the card. Applicants need to have a bank account and a verified income in order to apply for this card. This card charges a fee of $5 for cash advances, and a $5 fee if you overreach your credit limit. *Please note that this card is no longer available.

Home Trust Secured No Annual Fee Visa

* No annual fee
* Interest: 19.99%
* Minimum required deposit: $500
This card is ideal for people who expect to pay their balance in full every month. The interest rate is higher, compensating for the lack of annual fee, but this won’t affect you if you’re going to be paying your balance in full every month. The Home Trust card enables you to add another authorized user, and its credit limit may be as much as $10,000.

Home Trust Secured Low Interest Visa

* Annual fee $59
* Interest: 14.9%
* Minimum required deposit: $500

Of the two Home Trust cards, this version is preferable for people who might be carrying a balance from month to month, because the interest applied to that balance will be lower with this card. Applicants need to have a bank account in order to apply for this card.

Capital One Guaranteed Secured MasterCard

* Annual fee: $59
* Interest: 19.8%
* Minimum required deposit: $75

This easy to get credit card has one of the lowest minimum deposits, so it’s a good choice if you don’t have the $500 required by many of the other card companies. Its uses are less advantageous, since it has both an annual fee and a high interest rate, but it’s an option that’s open to you if you can’t afford the bigger deposit to get started.

Vancity Enviro Secured Visa

* No annual fee
* Interest: 19.5%
* Minimum required deposit: $500

Vancity offers a variety of extra perks, including insurance for travel accidents, price protection, and insurance for lost baggage. The card also has a system of reward-points for spending, called My Visa Reward Plus. The rewards include options like travel, redeeming for purchases, and charity donations.

The Vancity line of Classic credit cards includes several combinations of annual fee and interest rates, allowing you to choose the best solution for your situation. The options range from no annual fee and higher interest of 19.5% (for people who don’t plan to carry a balance) to a card with a $50 annual fee with lower interest of 11.25%.

Secured Credit Cards Offered by the Big 5 Canadian Banks

Secured cards are offered by all of the “Big Five” Canadian banks, and with relatively similar features. You will find that it’s difficult to uncover information on these cards online, and almost all of them require you to apply in person at the branch office.

You can inquire about details at the branch nearest you—and that’s not a bad thing. Although we’re accustomed these days to be able to do almost anything online, there’s something to be said for a face-to-face conversation with an expert who can talk to you about the pros and cons and details of the card for which you’re applying. So take the information below if it helps you to decide on which bank you’d like to visit, but know that any of these five banks will likely require you to apply in person.

Royal Bank of Canada (RBC) Secured Credit Card

* Annual fee $20
* Interest 11.99 on purchases & cash advances
* Minimum required deposit: $500

This low interest card with its modest annual fee is well suited for people who expect to be carrying a balance from month to month. Its optional extra features include travel insurance, roadside assistance, credit monitoring, and automatic payment options.

The RBC secured credit card charges fees of $3.50 for a cash advance ($5 if you’re out of the country) and an overlimit fee of $29 per statement period if your balance goes above your credit limit.

Bank of Montreal (BMO) Prepaid Credit Card

* Annual fee: $6.95
* No interest

The Bank of Montreal uses a prepaid model as its secured card option, meaning you can choose what amount you’d like to load to the card. It gives you more flexibility upfront (you don’t have the $500 minimum many other cards require) but doesn’t allow you to spend more money than you have on the card, or to take cash advances. The card itself operates much like a debit card, but without the associated checking account.

Toronto-Dominion (TD) Secured Credit Card

* Annual fee: $29
* Interest: 19.9%
* Minimum required deposit: $500

To apply for a Toronto-Dominion card, stop in at a TD branch office for an application. Your credit limit will be equal to whatever amount you are approved for, and deposit up front. If you maintain your TD secured credit card successfully for seven consecutive months, you can be eligible for an unsecured card as the next step toward repairing your credit.

Canadian Imperial Bank of Commerce (CIBC) Secured Credit Card

* Annual fee: $29
* Interest: 19.9%
* Minimum required deposit: $500

Like the TD card, you will need to apply in person for a CIBC secured credit card, by stopping in at a TD branch office for an application. Your credit limit will be equal to whatever amount you are approved for, and you make the deposit up front.

CIBC will give you a card for a specific term, usually two years. At the end of the two years they’ll refund your deposit—and by that time you will probably qualify for an unsecured card if you’ve used your secured card wisely.

Scotiabank Secured Credit Card

* No annual fee, no balance transfer fee
* Interest: 16.99%
* Minimum required deposit: $500

The no-fee Value Visa card is a great option if you’re looking to transfer balances from other credit cards. There’s no fee for balance transfer, and the introductory APR is a low 3.99 percent for the first six months. (That rate goes up to 16.99 percent after the introductory period, so try to pay off your balance before you hit the six-month mark.)

In Conclusion

Secured credit cards are the best way to improve your credit score, or to establish one if you are new to Canada and don’t have a financial history in this country. With your secured credit card you will enjoy all the benefits of credit card membership, like making purchases online and over the phone, or accessing cash from ATMs.

Your life will feel easier and your daily transactions will be smoother once you have a secured credit card at your disposal. Enjoy all the advantages of having a card, like being able to make reservations or purchase items online. And build your credit score as you go, by making sure to handle your card finances wisely.

Your secured credit card can serve as a stepping-stone to bigger things, like unsecured cards, car loans, or even a mortgage. Used wisely, the secured credit card is a gateway to your future. Let your credit score soar!

Filed Under: Uncategorized Tagged With: canadian travel credit cards, credit cards, secured credit cards

Reader Interactions

Comments

  1. Christina Peaker says

    February 19, 2019 at 3:32 pm

    I would like to try the Royal bank secured credit card but when I called they told me they don’t do it, could you help me please

    Reply
    • David Cook says

      February 28, 2019 at 8:41 pm

      I had also tried RBC, and they told me it was for newly arriving immigrants to Canada.

      Reply
    • Jeff says

      September 18, 2019 at 7:30 pm

      Rbc does no issue a secured card….I just left there, either does CIBC

      If you are in the Vancouver or Victoria area then Vancity does if you open a chequing account..I have $2,000 secured card…I love Vancity

      Reply
  2. Lina says

    March 6, 2019 at 12:49 am

    Dont apply at the banks secure credit cards, even as a secure card, they dont approve you,if, you dont meet their expectations of a good credit score.

    Reply
  3. Jody says

    April 4, 2019 at 5:44 pm

    So I am confused. It shows that the BANK OF MONTREAL (BMO) PREPAID CREDIT CARD, is one of the top ten, but yet I am certain it does nothing in regards to either improving or simply giving you a credit score if you don’t have any credit history. I’ve had this card for a year and a half now and my credit score is still non-existent even though I have continuously used it.

    I am wondering what is the best no hassle, quick, simple and easy, secured credit card with NO ANNUAL FEE, would be to apply for to build a credit score?

    Reply
    • Jacqueline says

      May 3, 2019 at 8:00 pm

      Hi… get the Home Trust Secured Visa. I have one, and it’s the best.

      Reply
      • muath al nabulsi says

        July 18, 2019 at 11:02 am

        is it guarantee approve if I apply under consumer proposal

        Reply
        • Behzad says

          September 2, 2019 at 5:46 pm

          I would love to know the answer as well
          I have a same situation

          Reply
        • Jeff says

          October 6, 2019 at 1:50 am

          Yes. You can apply and be approved in a Consumer proposal. You cannot if you’re in Bankruptcy.

          Reply
      • Annie says

        August 14, 2019 at 8:17 pm

        Unfortunately, this card is not available for Quebec residents and it sucks. There are so many things related to financial stuff that is available throughout Canada but not in Quebec, it’s insane: banks, credit cards, referral programs, bonuses, special offers, points programs, promotions, perks, etc. Be happy you’re not living in the same province as I and appreciate the benefits. I wish I could easily move out of here.

        Reply
    • Pete says

      May 6, 2019 at 9:50 pm

      Try RBC’s no fee cashback MC: https://www.rbcroyalbank.com/credit-cards/cash-back/rbc-cashback-mastercard.html

      It gives 2% back on groceries and 0.5%-1% back on everything else, plus 3c off fuel at Petro Canada.

      As explained above, I think you do need to apply for the secured version in branch. That’s what I did anyway. They start you off with a credit limit equal to whatever you deposit in a non-redeemable GIC.

      Reply
  4. rachel says

    April 18, 2019 at 2:28 pm

    peoples trust credit card is no longer available should remove from your site

    Reply
    • Sam says

      May 9, 2019 at 2:45 pm

      Thanks Rachel,

      I’ll update the article later today.

      Reply
      • Derek says

        September 1, 2019 at 7:09 pm

        Needed to add Refresh Financial

        Reply
  5. CredFew says

    April 29, 2019 at 10:41 pm

    big banks no longer offer secured credit cards. I stopped at branch of CIBC, RBC, BMO, Scotia, National Bank, TD. All confirmed. RBC only offer secured card to New Immigrants.

    Reply
    • flexfelix says

      July 27, 2019 at 4:32 am

      TD, Scotia, National bank offer Secured Card as long as collections paid off, no bankruptcy, no proposal.
      Apply for National Bank CC online, once you receive declined letter on the mail take it to local national bank branch ask to set up secured card.

      TD and Scotia need to apply at branch and ask to provide security deposit once approved. This usually takes two to four weeks.
      BMO prepaid cards. No credit check, nothing get reported to credit bureaus. Useless if you are planing on building credit. Rental car companies don’t accept this card.
      CIBC and RBC don’t offer cards to Canadians. Only new comers.
      I hope it helps.

      Reply
      • Richard Deubner says

        October 11, 2019 at 2:39 am

        Get the Refresh Financial Card. I rented a car with this one no problem but you will
        need to have at least a $500 limit cause they need a $200 deposit plus the cost of the
        car rental when you pick it up. This was at Enterprise Rent A car.

        Reply
  6. antony says

    May 18, 2019 at 10:01 pm

    Home Trust is still going, Van City still offers the secured credit card. Scotia, a month ago deleted their secured credit card program and that pissed off a lot of customers who were involved in the program (that’s according to the lady at Scotia who talked to me about). Makes me wonder if this secured credit card program will be abolished by all banks, then what?

    Reply
  7. Don says

    May 28, 2019 at 9:07 pm

    Just got off the phone with CIBC and as of January 2019, they no longer offer a secured credit card.

    Reply
  8. Martine Vézina says

    September 19, 2019 at 7:07 pm

    I have tried to National bank, and I still don’t understand even with a safe deposit, and provided all my story of consumer proposal, and they refused after 2 days of investigation. Wow why ? My advice, don’t go in any banks. I use to have Peoples trust and it was perfect. So bad they don’t take new clients.

    Reply
  9. Riri says

    October 8, 2019 at 3:06 am

    Refresh financial is not here only because they require a minimum of $1000 deposit. Their customer service is the worse of the worse. The man I spoke with didnt seem like he wanted to help me at all. I felt I was being judged.

    Reply

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