What Credit Card Can You Get with Bad Credit?

Written by Banks Editorial Team
13 min. read
Written by Banks Editorial Team
13 min. read

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A credit card is great for covering expenses and building credit, but a bad credit score can complicate the approval process. A better credit score gives you more choices, but the reality is that past financial missteps won’t necessarily disqualify you from getting a credit card with reasonable terms. And by shopping around to find the best fit, you could start rebuilding your credit health and open the door to better financial opportunities.

Get a Digital Credit Card
Access a revolving line of credit based on your cash flow, not your credit score, with the Grain digital credit card.

What Do Credit Card Companies Consider Bad Credit?

FICO is the most prevalent credit scoring model. It’s used by 90 percent of creditors and lenders to make credit decisions.

A bad credit score is anything below 579. Here’s a breakdown of FICO score ratings: 

  • Poor: 300 to 579
  • Fair: 580 to 669
  • Good: 670 to 739
  • Very good: 740 to 799
  • Exceptional: 800 to 850

Although a 580 credit score puts you in the fair category, you should get your score as high as possible. A 620 credit score is enough to get a conventional mortgage, but your maximum loan amount and interest rate will be more attractive if you continue building your score beyond the minimum requirement.

What Is The Minimum Credit Score Needed for a Credit Card on Average?

It depends on the credit card issuer. Some will accept consumers with poor credit scores. Others don’t conduct a credit check or require a credit history to get approved.

However, credit cards with attractive terms and incentives are generally reserved for individuals with very good or exceptional credit. So, it’s worthwhile to start building your credit score sooner than later. Some credit card issuers that provide starter cards give cardholders the flexibility to switch to an unsecured credit card with better rewards and lower rates in the future.

How Do Credit Cards Improve Your Credit Score?

Credit cards can help boost your credit score in several ways. For starters, payment history accounts for 35 percent of your credit score. It is the largest category of your FICO score. So, paying on or before the due date each month will help build positive payment history, and your score will increase over time. 

On-time payments will strengthen another credit scoring category that has a significant impact on your score. The amount you owe creditors accounts for 30 percent of your credit score. This metric is measured by credit utilization or the percentage of your credit limit used on revolving accounts (i.e., credit cards). You want to keep your utilization at 30 percent or lower – 10 percent or lower is even better – to improve your credit score. So, if your credit limit is $1,000, try to keep the balance at or below $300. Again, paying on time and making more than the minimum payment will put you in the right direction. Payment history and credit utilization make up 65 percent of your credit score combined.

Other Things to Consider When Choosing a Credit Card

Picking your first or next credit card is an important decision. The card you select can impact your expenses and how quickly you build credit. When researching credit cards for bad credit, keep these factors in mind.

Reports Payments Made

Does the credit card issuer report account activity to the three credit bureaus – Experian, TransUnion and Equifax? Even if they don’t report to all three, it’s vital that they report to at least one credit reporting agency, so your credit report gets updated. Positive payment history, which accounts for 35 percent of your credit score, can significantly boost your credit health. If a credit card issuer does not report to any of the major credit bureaus, you will not build credit. Many people use credit cards to improve their scores, especially credit cards designed for people with bad credit. Do not consider a credit card issuer that does not report your activity to any of the credit bureaus.

Low Costs and Fees

What APR does the card offer? Are there monthly maintenance fees or annual fees? Will a penalty APR be assessed if you make a late payment? Ideally, you want to stick with credit cards that assess minimal fees so that you can keep costs down. Some credit cards also come with an introductory period of 0% APR for the first 6-18 months. It’s more difficult to find this incentive on credit cards for consumers with bad credit, but be on the lookout. This advantage gains relevance when your credit score increases, and you can qualify for better cards. In addition, 0% APR for a limited time will make it easier to pay off lingering credit card debt.

Ability to Upgrade Later On

If you start with a secured credit card, is it possible to upgrade to an unsecured credit card in the future? People with bad credit should look for secured credit cards with this option. Some credit card issuers let you upgrade to a better credit card within a year. Ask the credit card company if this is an option for cardholders who demonstrate responsible use of their secured credit cards over time. Some credit card issuers will not do another hard credit check for you to obtain the upgraded card.

Credit Cards That You Can Get with Bad Credit

A bad credit score gives you fewer options, but you can still get a credit card. Most credit card issuers have starter cards that can get you back on your feet and build good credit over time. Several credit card options are available even if your credit score is lower than average.

Virtual Credit Cards with No Credit Check

Finding credit card solutions that do not require a credit check is a significant advantage. Every hard credit inquiry reduces your credit score by a few points, but you won’t have to worry about that with some credit card solutions.

Grain is a notable solution that is an alternative to opening a credit card. Instead of a conventional credit card, Grain lets you open a line of credit with no credit check required. This line of credit connects to your debit card and can be up to $1,000. It’s available on the AppStore, or you can join the mailing list to be notified when it’s released on Google Play if you have an Android device. 

Even better, it syncs with your debit card, so you can easily access funds when you need them. Simply initiate a transfer from your revolving line of credit to your checking account via the mobile app and instantly use your debit card. 

Account activity is also reported to the three major credit bureaus – Experian, TransUnion and Equifax – to help improve your payment history and overall credit health. 

Some people reluctantly use credit cards to build credit even though these cards can get you deep into debt if you are not careful. Grain provides a viable alternative that still allows you to increase your credit score. Download the Grain app today to learn more about the host of enticing features it offers. When you set up an account and connect your primary checking account, Grain will review your account activity to determine if you’re pre-approved for a personal line of credit up to $1,000. 

It only takes a few minutes of your time and won’t impact your credit score. 

Secured Cards

Secured credit cards operate like traditional credit cards but require a refundable security deposit to get approved. The amount you deposit is typically equal to your credit limit and is held by the lender until you’re upgraded to an unsecured credit card (if applicable) or close your secured card account. If you close your secured credit card, the refundable deposit will first go toward any remaining credit card debt. Then, after paying that expense with your refundable security deposit, the credit card issuer will provide you with the leftover funds.

Some secured credit cards offer rewards programs or cashback opportunities, but these are rare. You have a better chance of finding a secured card for people with bad credit and then converting it into an unsecured card after responsible credit use.

Subprime Cards

There’s an assortment of unsecured credit cards that cater to consumers with bad credit. However, many come with steep APRs and fees, and you may not have the option to upgrade to a more favorable unsecured card. The APRs on some subprime credit cards can exceed 30%. These cards are better for people who want to build credit but do not have enough cash in the bank for a refundable security deposit. 

Store credit cards also fall into this category. Although the credit limits are usually on the lower end, you may be able to qualify with a low credit score. Plus, most aren’t riddled with pesky maintenance fees. 

Store credit cards are restricted to those stores. You won’t be able to use a GameStop credit card to shop for groceries or make any purchases outside of GameStop. The same rule applies to other store credit cards. However, these cards offer exclusive discounts for purchases within the business. While an Apple credit card doesn’t restrict you to Apple products alone, the 3% cash back you earn on every qualifying purchase at any Apple Store demonstrates how some brands can offer additional perks for their cardholders.

Cards with Alternative Underwriting

Alternative-approval credit cards are designed for credit newbies that are unable to get approved elsewhere due to limited credit history. You can also find credit card issuers that offer these cards to consumers with bad credit and consider alternative data (i.e., bank account activity) when assessing your eligibility for a credit card.

The Best Credit Cards for People with Bad Credit

Consumers with bad credit have many options. They can get started with Grain or explore different types of credit cards available for people with bad credit. We have shared credit card categories for consumers that don’t have the best credit scores. This list provides a breakdown of some of the top credit cards you can choose to rebuild to a good credit score.

Capital One Platinum Secured Card

The Capital One Platinum Secured Card has the lowest security deposit requirement. You only have to put down $49 to qualify for a $200 credit limit. Capital One will even look at your card after six months to determine if you qualify for a higher credit limit without any additional security deposit required. You can earn your security deposit back through on-time payments instead of having to wait for an unsecured credit card or to close your secured card. This card has no annual fee or hidden fees.

OpenSky Secured Visa Credit Card 

The OpenSky Secured Visa Credit Card has a lower APR than most of the cards on this list, but you will have to pay a $35 annual fee. You must make a refundable deposit of at least $200, but you can contribute more money to increase your credit limit. You will receive the funds back if you close your credit card or turn it into an unsecured card.

OpenSky lets secured credit cardholders apply for the OpenSky Gold Unsecured Card in as little as six months. The issuer has an accommodative payment due date policy and reports to all three major credit bureaus each month.

Citi Secured Mastercard

A Citi Secured Mastercard has a $200 security deposit requirement and no annual fees. Your refundable deposit can be as high as $2,500 if you want a higher credit limit. The higher credit limit will help with your credit utilization ratio if you cannot repay the entire balance right away. A higher credit limit also makes it less likely for you to incur additional fees for exceeding your limit.

Citi reports your credit activity to all three major credit bureaus. They also offer FlexPay, which lets you pay the credit card at the beginning, middle, or end of the month. You can set up AutoPay to receive alerts that remind you to keep up with your credit card balance and make on-time payments. Citi may upgrade you to an unsecured credit card if you use this card responsibly over 18 months. You can expect high-interest rates for cards like the Citi Secured Mastercard, but that is par for the course with unsecured credit cards.

Bank of America Secured Credit Card

Want to get cash back while repairing your credit score? The Bank of America Secured Credit Card lets you earn up to 3% cash back on select purchases. This secured credit card gives you 1% cash back on every purchase and 2% cashback for purchases at wholesale clubs and grocery stores. The 3% cash back comes from an expense category of your choice. Cardholders can get 3% cash back from online shopping, dining, home improvements & furnishing, gas, travel, or drug stores. The 2% and 3% cash back deals last for the first $2,500 in combined purchases, and then it’s 1% cash back across the board. 

The Bank of America Secured Credit Card requires a $200 refundable deposit, a common theme among secured credit cards. The secured card does not have an annual fee. It’s great for consumers with bad credit scores who want a path to recovery and cashback rewards.

Get a Digital Credit Card
Access a revolving line of credit based on your cash flow, not your credit score, with the Grain digital credit card.

Discover It Secured Credit Card

The Discover It Secured Credit Card is one of the few secured credit cards with cash back rewards, alongside the Bank of America Secured Credit Card. Cardholders get 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases each quarter. Every other purchase qualifies for 1% cash back. Most secured credit cards do not offer any rewards, making the Discover It Secured Credit Card one of the most enticing options available. You even get double cash back at the end of your first year. This secured credit card has no annual fee. 

You must make a refundable security deposit of at least $200, but a higher security deposit increases your credit limit. You can receive your refundable deposit back in six months if you make on-time payments and maintain good status on all of your credit accounts. You need to responsibly manage credit card debt and loans across all of your finances, not just financial products associated with your Discover account.

U.S. Bank Cash+ Visa Secured Card 

The U.S. Bank Cash+ Visa Secured Card’s APR hovers close to 30%, which isn’t the best. But if you don’t fall behind on credit card debt, it won’t be an issue. The card also has a minimum security deposit of $300, which is a little higher than the $200 standard. You can make a refundable deposit of up to $5,000 to get a higher credit limit.

Despite those disadvantages, many people flock over to this card. It has no annual fees and 5% cash back on some purchases. You can select two expense categories to obtain 5% cash back for the first $2,000 you spend. After that, you can pick another spending category that can qualify for 2% cash back, and everything else qualifies for 1% cash back. Depending on how you split up your expenses, you can pick the two expense categories where you spend the most money and quickly capitalize on the 5% cash back’s maximum reward. It’s hard to find secured credit cards with rewards programs in general, but 55 cashback is a great find, even for unsecured credit cards.

Capital One Quicksilver Secured Cash Rewards Credit Card

The Capital One Quicksilver Secured Cash Rewards Credit Card offers 1.5% cash back on all eligible purchases. You can get approved for this credit card in seconds and start using it right away. This secured credit card requires a $200 security deposit, but you can increase this amount to have a higher credit limit. If you book hotels and rental cars through Capital One Travel, you can get 5% cash back on those purchases. This 5% cash back perk is unlimited, unlike some of the other 3%-5% cash back rewards incentives on this list.

First Progress Platinum Prestige Secured Mastercard

The First Progress Platinum Prestige Secured Mastercard has a $200 security deposit with a $2,000 maximum. The credit card issuer reports your payment activity to the major credit bureaus each month so you can build credit with every on-time payment. You do not need any credit history to get approval, and you can get this card even if you have bad credit. For example, a discharged bankruptcy on your credit report will not prevent you from getting this card, and you won’t have to endure a hard credit inquiry. First Progress also has an expedited processing option that lets you obtain the card sooner.

Many secured credit cardholders aspire to have an unsecured credit card in the future, and First Progress provides one of the quickest turnarounds. You can get your secured card upgraded to an unsecured card if you make six months of on-time monthly payments. If you meet that condition and keep your secured card in good standing, First Progress will invite you to apply for an unsecured First Digital Master Card. 

Assent Platinum Secured Mastercard

The Assent Platinum Secured Mastercard does not have a credit inquiry requirement. Therefore, you can open a new card without hurting your score. The interest rate for this card hovers near 30%, which is normal for many secured credit cards but still high. Your credit activity gets reported to the major credit bureaus each month, and you can get started sooner with Assent’s Expedited Processing option. This choice lets you obtain your card sooner so you can start using it to build credit. 

The Assent Platinum Secured Mastercard does not have an annual fee, and you only need a $200 security deposit to get started. Cardholders can make a security deposit as high as $2,000 to strengthen their credit utilization ratio and make themselves less prone to borrowing over the limit and incurring additional fees.

First Tech Platinum Secured Mastercard

The First Tech Platinum Secured Credit Card has the most attractive APR on this list. First Tech does not exceed 18% APR for their cards. First Tech also boasts fewer fees. They have no annual fees or costs for balance transfers, cash advances, or foreign transactions.

You can even earn points with this credit card. Cardholders receive one point for every dollar spent on everyday purchases. Consumers can use points for travel, merchandise, gift cards, and other perks, and these points never expire. The First Tech Platinum Secured Mastercard also features an advanced online banking experience. You can temporarily lock your card or order a replacement right away with their mobile app.

Although the card has great benefits and a low APR, the security deposit is higher than most cards on this list. You will need to make a $500 security deposit to obtain this card. You can make a higher deposit to increase your credit limit, but most cards on this list only have a $200 requirement for the refundable deposit.

Strategies to Improve Your Credit Score

Consumers who get secured credit cards have a clear objective: improve their credit scores. A higher credit score helps you get better financing, and you could qualify for an unsecured credit card sooner. Unsecured credit cards have lower interest rates and better rewards programs than secured credit cards. Applying these strategies can help you grow your credit score faster so you can move onto an unsecured credit card and have more financial options.

Avoid Hard Inquiries

Many lenders and creditors use hard credit inquiries to get a better understanding of your credit profile. Financial institutions, credit unions, and online lenders use this information when assessing your application for a loan or line of credit. A single hard credit inquiry will reduce your score by a few points. It’s not a devastating event for your credit score, but accumulating hard credit checks can significantly drag down your score.

Luckily, most secured credit card issuers do not conduct hard credit checks. However, some of them may do soft credit pulls, and that is okay for your score. A soft credit check will not impact your credit. 

Get a Higher Credit Limit If You Can Afford It

A higher credit limit helps your credit utilization ratio. However, this ratio impacts 30 percent of your score. Therefore, it’s best to keep your credit utilization ratio under 10 percent. For instance, if you make a $200 security deposit, you should strive to have no more than $20 on your credit balance before the credit card issuer reports your activity to the major credit bureaus. 

Keeping your credit card balance under $20 may seem daunting. It may also be challenging to reach that level if you have an existing balance. You can get it as high as $60 for a 30 percent credit utilization ratio, a percentage that would still help your credit score. Putting more money into your security deposit will increase your credit limit and result in a more favorable credit utilization ratio. 

You can bypass this issue by always paying off your credit card balance. But when this option is not always possible, getting a higher credit limit can put your credit utilization in a better position. You can also get a line of credit with Grain. Grain connects with your debit card and uses cash flow to review your application instead of your credit score. Grain lets you get a credit limit of up to $1,000 without requiring a security deposit.

Make More Than the Minimum Monthly Payment

The minimum monthly payment will keep your credit card in good standing. You will avoid late payment fees and improve your payment history, the largest component of your credit score. However, stopping at the minimum payment allows interest to compound on the remaining balance. Compounding interest is a concern for any credit card, but with secured credit card rates hovering near 30% in most cases, it’s more important to pay off your credit card balance. Doing so will also improve your credit utilization ratio.

Review Your Expenses

Your money habits can help you rebuild credit or put yourself into a deeper hole. On-time monthly payments are a critical element in raising your credit score and qualifying for better financing in the future. If you have not done so already, tracking your expenses on previous bank account statements can give you insights into how you spend and opportunities to lower your costs.

Reviewing your expenses can help you save money, and that does two things for your credit score. The first benefit is that you won’t incur as much credit card debt each month. Less spending keeps you further away from your credit limit. The second benefit is that those extra savings can go toward paying your credit card balance. 

Monitor Your Credit

If you want to improve in any area, you have to track it. Most financial institutions make it easy to monitor your credit and see how your score improves over time. You can receive alerts when your credit score changes and look at your score through your institution’s mobile banking app. 

Monitoring your credit can instill great financial habits that move you in the right direction. Building credit puts you in a better position for financing, but increasing your income, minimizing your expenses, and investing more money each month will have a stronger impact on your wealth in the long run. Your credit-building journey can help you address core areas of your finances. A secured credit card, the Grain app, or another solution can help you build credit. Monitoring your credit and taking control of your finances will create more possibilities for your life.

Get a Digital Credit Card
Access a revolving line of credit based on your cash flow, not your credit score, with the Grain digital credit card.

Disclaimer: Credit offer based on cash flow in the linked checking account and may require a credit check. All accounts are subject to ID verification and approval. See your Credit Agreement and Terms of Service for further details.

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