What the Chase Secured Card does

The Chase Secured Credit Card is a card issued by Chase Bank that requires you to put down a cash deposit, which becomes your credit limit. You use it like any other credit card — swipe it, pay a monthly bill, build a payment history — but Chase holds your deposit as collateral. The deposit stays in a separate account and earns a small amount of interest while you hold the card.

This structure exists because it lets people with no credit history or damaged credit build a record of on-time payments. Chase reports your activity to all three credit bureaus (Equifax, Experian, and TransUnion), so consistent use and payment can improve your credit score over time. After you demonstrate responsible use — typically 6 to 18 months of on-time payments — you may be able to graduate to an unsecured card, at which point Chase returns your deposit.

Key Takeaways

  • Your deposit becomes your credit limit, so a $500 deposit gives you a $500 limit; Chase holds the deposit in a separate account and pays interest on it.
  • The card charges an annual fee (currently $39) and a variable interest rate that depends on your creditworthiness at the time you open the account.
  • Chase reports your payment history to all three credit bureaus, which means on-time payments build your credit score and missed payments damage it.
  • You can request to graduate to an unsecured card after demonstrating responsible use, at which point Chase returns your deposit.
  • The card offers no cash back or rewards, so it is purely a tool for building credit rather than earning benefits.

Deposit amount and credit limit

You choose your deposit amount when you open the account, and that amount becomes your credit limit. Chase currently requires a minimum deposit of $500 and allows deposits up to $25,000. Your limit will never exceed your deposit, and your deposit will never increase unless you add more money to it.

The deposit sits in a non-interest-bearing account (or in some cases an account that earns a small amount of interest, depending on current Chase terms). You cannot withdraw the deposit while the card is open — it stays locked until you either close the account or graduate to an unsecured card. If you close the account, Chase returns the deposit to the same funding source you used to open it, usually within 5 to 7 business days.

Fees and interest rates

The Chase Secured Credit Card charges a $39 annual fee, due on your account anniversary each year. There is no grace period on this fee — it posts automatically. If you carry a balance from month to month, you will also pay interest on that balance at a variable rate. The rate depends on the prime rate and your creditworthiness when you open the account; Chase does not publish a specific range, but rates typically fall between 18% and 24% APR.

There are no other regular fees. Chase does not charge a foreign transaction fee, so you can use the card internationally without a markup. Late fees and over-limit fees explore if you miss a payment or exceed your credit limit, but these are standard across the industry and vary by circumstance.

How the card reports to credit bureaus

Chase reports your account activity to Equifax, Experian, and TransUnion every month. This means your payment history, credit utilization (how much of your limit you are using), and account age all feed into your credit score. On-time payments help your score; missed payments, high balances, and late accounts hurt it.

The card is most useful if you use it regularly but keep your balance low. Experts generally suggest using 10% to 30% of your available credit — so if your limit is $500, charge $50 to $150 per month and pay it off in full. This shows lenders you can manage credit responsibly without paying interest. Paying the full balance each month also avoids the high interest rate.

Graduating to an unsecured card

After you have held the card for a period of time and made consistent on-time payments, Chase may offer to convert it to an unsecured card. This is not automatic — Chase reviews your account periodically and decides whether to extend the offer. The timeline varies, but many cardholders see an offer after 6 to 18 months of responsible use.

When Chase converts your card, your deposit is returned to your original funding source, usually within 5 to 7 business days. Your credit limit may stay the same, increase, or decrease depending on your credit score and payment history at the time of conversion. The annual fee structure may also change — some unsecured cards have no annual fee, while others charge a different amount.

When this card makes sense

The Chase Secured Card is most useful if you have no credit history (you are new to credit) or if your credit score is very low (typically below 580). It is also a reasonable choice if you have been denied for unsecured cards and need a way to rebuild. The fact that Chase reports to all three bureaus means your efforts will be visible to other lenders.

The card is less useful if you already have a credit score above 620 or if you have other cards with better terms. The $39 annual fee and lack of rewards make it expensive compared to unsecured cards aimed at fair-credit borrowers. If you can may have access to for a card without a deposit, that is usually the better choice. However, if a deposit card is your only option right now, the Chase Secured Card is a legitimate tool for building credit.

Alternatives to consider

Other banks offer secured cards with different terms. Capital One Secured Mastercard has no annual fee and reports to all three bureaus, making it a cheaper option if you may have access to. Discover Secured Card also has no annual fee and offers 2% cash back on dining and gas, plus 1% on other purchases — though it may be harder to get approved for if your credit is very low.

If you have a small amount of credit history but a low score, you might also look at unsecured cards designed for fair-credit borrowers, such as the Capital One Platinum or the Discover It Secured alternative. These do not require a deposit and may have lower interest rates. The trade-off is that they are harder to get approved for if you have no history at all.

Frequently Asked Questions

Can I use my deposit as a regular savings account?

No. Your deposit is held as collateral and is not accessible while the card is open. You cannot withdraw from it, transfer it, or use it for anything else. It stays in a separate account until you close the card or graduate to an unsecured version.

What happens if I miss a payment?

A missed payment will be reported to all three credit bureaus and will damage your credit score. Chase will charge a late fee (the amount depends on how late the payment is) and may increase your interest rate. If you miss payments repeatedly, Chase may close your account, and you will still owe the balance even though the card is closed.

Does the deposit earn interest?

Chase's terms on this vary. Some accounts earn a small amount of interest on the deposit (typically less than 1% APY), while others do not. You can ask Chase about the current rate when you open your account, but the interest earned is minimal and should not be your main reason for choosing this card.

How long does it take to graduate to an unsecured card?

There is no set timeline. Chase reviews accounts periodically and may offer conversion after 6 months, 12 months, or longer. It depends on your payment history, credit score improvement, and how much you use the card. Some people graduate in under a year; others take 18 months or more.

Can I increase my credit limit without adding more money to my deposit?

No. Your credit limit is always equal to your deposit amount. If you want a higher limit, you must add more money to your deposit account. You can do this by contacting Chase, though there are limits on how much you can deposit (currently up to $25,000 total).