How secured credit cards work

Using Plastk card
chibelek / Twenty20

A secured credit card is basically the same as a traditional credit card, with one big difference: your credit limit is based on a refundable security deposit rather than your credit rating.

When you apply for a secured card like Plastk, you’ll put down a cash deposit as collateral.

The amount you put down is the same as your credit limit, so if you put down a security deposit of $500, you’ll have $500 available to spend on your card.

Plastk requires a minimum security deposit of $300, but you can request a credit limit of up to $10,000.

Just like a regular credit card, you’ll have to pay interest on your balance, so it’s in your best interest to make your payments on time and in full each month.

And by staying on top of your payments, you’ll not only avoid paying fees — you’ll also boost your credit score in the process.

Why use Plastk?

Alt text

Although Plastk may not be the first secured credit card in Canada, it’s the first secured card that comes with a premium rewards program.

When you use your Plastk Card places Visa1 is accepted — pretty much everywhere — you’ll earn rewards points that can be redeemed for cash back, gift cards or merchandise from thousands of top brands.

Plastk also provides valuable tools to help you monitor your credit score and make the right moves to improve it.

You’ll be able to see your Equifax credit score each month and compare how your score stacks up against other people in your area and age group.

You’ll also have access to a wide range of educational videos, podcasts, and online tutorials that will help you better understand your credit score and what you can do to bump it up.

Plastk only costs $6 a month, plus a yearly fee of $48. That’s significantly less than a lot of other rewards cards, and means you can turn your bad credit score into a good one for the price of two lattes each month.

Don’t settle for a low score

Your credit rating matters, and the sooner you get it back on track the better off you’ll be — especially if you’ve been turned down for loans or other credit cards in the past.

Right now Plastk is offering a special sign up bonus of 0% interest for your first three months, along with 5,000 bonus rewards points.

So don’t wait, apply for a Plastk Card today and start building your credit pronto.

1This card is issued by DirectCash Bank pursuant to license by Visa International. Use of the card is governed by the agreement under which it is issued. The Visa Brand is a registered trademark of Visa International used under license by DirectCash Bank. All credit and funding are provided by Plastk Financial & Rewards Inc. DirectCash Bank provides no credit or loans. All funding and lending for this program is provided by Plastk Financial & Rewards Inc.

About the Author

Shane Murphy

Shane Murphy

Reporter

Shane is a reporter for MoneyWise. He holds a bachelor’s degree in English Language & Literature from Western University and is a graduate of the Algonquin College Scriptwriting program.