The security deposit is the defining feature of secured credit cards. It's what makes approval possible for people with no credit or poor credit. But how much should you deposit? Is it refundable? Where does the money go? In this guide, we'll answer all your questions about security deposit requirements.
What Is a Security Deposit?
A security deposit is money you pay upfront when opening a secured credit card. This deposit serves as collateral—if you don't pay your bills, the card issuer can use your deposit to cover the debt. This protection is why secured cards are easier to get approved for than unsecured cards.
How Much Deposit Do You Need?
Security deposit requirements vary by card. Here's what different cards require:
| Card | Minimum Deposit | Maximum Deposit |
|---|---|---|
| Capital One Platinum Secured | $49 - $200* | $200 - $1,000 |
| Discover it® Secured | $200 | $2,500 |
| OpenSky® Secured | $200 | $3,000 |
| Chime Credit Builder | $0** | No limit |
| Citi® Secured | $200 | $2,500 |
*Capital One's deposit varies based on creditworthiness
**Chime uses your account balance instead of a traditional deposit
Check our complete secured card comparison for deposit requirements on all cards.
Deposit Amount = Credit Limit
For most secured cards, your security deposit equals your credit limit dollar-for-dollar. If you deposit $500, you get a $500 credit limit. This is different from unsecured cards, where your limit is determined by your creditworthiness.
Exception: Capital One Platinum Secured may offer a credit limit higher than your deposit based on your credit profile. For example, a $49 deposit might get you a $200 credit limit.
How Much Should You Deposit?
The amount you should deposit depends on several factors:
Consider Your Monthly Spending
If you typically spend $300 per month, depositing only $200 means you'll constantly be near your credit limit (high utilization). Depositing $1,000 gives you room to keep utilization low while still using the card regularly.
Optimal Utilization Strategy
For the best credit score impact, keep your utilization below 30%—ideally under 10%. Here's how different deposits affect utilization at various spending levels:
| Monthly Spend | $300 Limit | $500 Limit | $1,000 Limit |
|---|---|---|---|
| $50 | 17% | 10% | 5% |
| $100 | 33% | 20% | 10% |
| $200 | 67% | 40% | 20% |
| $300 | 100% | 60% | 30% |
Our Recommendation
Deposit at least 3x your expected monthly spending. If you'll spend $200/month, deposit at least $600. This keeps utilization around 33% even at peak spending, and lower if you make mid-month payments.
Is the Deposit Refundable?
Yes, your security deposit is fully refundable. You get it back in several scenarios:
1. Upgrade to an Unsecured Card
If your card issuer graduates you to an unsecured card, they'll return your deposit. This typically happens after 6-18 months of responsible use. Discover, Capital One, and Citi all offer graduation programs.
2. Close Your Account
If you close your account in good standing (with a $0 balance), your deposit will be refunded. This typically takes 2-3 billing cycles. Note: closing an account can affect your credit score by reducing available credit and shortening credit history.
3. Automatic Refund (Rare)
Some issuers may automatically refund your deposit after extended responsible use while keeping your account open. This essentially converts your secured card to unsecured without requiring a new application.
Where Does Your Deposit Go?
Your security deposit is held in an FDIC-insured account at the card issuer's bank. It doesn't get "spent" when you make purchases—it simply sits as collateral. Some important points:
- FDIC insured: Your deposit is protected up to $250,000
- Separate from your balance: You can't use the deposit to pay your bill
- May earn interest: Some issuers pay interest on deposits (rare)
- Protected if issuer fails: FDIC insurance covers your deposit
Can You Increase Your Deposit?
Many card issuers allow you to increase your deposit after opening the account, which increases your credit limit:
- OpenSky®: Yes, can add to deposit anytime
- Discover: Yes, in increments of $100
- Capital One: No additional deposits accepted
- Citi: Limited ability to increase
Increasing your deposit is a good strategy if your initial deposit was low and you want to improve your credit utilization ratio without applying for additional cards.
Deposit Payment Methods
How you can pay your deposit varies by issuer:
Most Common Methods
- Bank transfer: Link your bank account and transfer funds
- Debit card: Use your debit card for immediate funding
- Money order: Send a money order by mail
No Bank Account Options
If you don't have a bank account, OpenSky® is notable because it doesn't require one. You can fund your deposit with a debit card, money order, or cash at participating locations.
Compare Deposit Requirements
See deposit ranges and payment options for all the top secured credit cards in our comprehensive comparison.
View All CardsWhat Happens If You Miss Payments?
If you miss payments or default on your secured card, the issuer can use your deposit to cover the debt. Here's the typical process:
- 30 days late: Late fee charged; payment reported late to credit bureaus
- 60-90 days late: Additional fees; significant credit score damage
- 180 days late: Account typically charged off
- After charge-off: Deposit used to offset balance; remaining debt may go to collections
Important: Even if your deposit covers the full balance, the charge-off will severely damage your credit and stay on your report for 7 years. Always make at least the minimum payment on time.
Common Deposit Questions
Can I use my deposit to make a payment?
No. Your deposit and your balance are completely separate. You must make payments from your own funds. The deposit only gets used if you default.
What if I can't afford a large deposit?
Start with what you can afford. Even a $200 deposit gets you started building credit. Capital One Platinum Secured may require as little as $49 depending on your profile.
Does a larger deposit help my credit score faster?
Indirectly, yes. A larger deposit means a higher credit limit, which makes it easier to maintain low utilization—a major factor in your credit score.
Can I get my deposit back early?
You can request account closure at any time and receive your deposit back. However, closing a credit card can negatively impact your credit score, especially if it's your only card.
Final Thoughts
Understanding security deposit requirements helps you make smarter decisions when choosing and using a secured credit card. Deposit more than the minimum if you can—the larger credit limit will help you maintain lower utilization and build credit faster.
Ready to find the right secured card for your budget? Visit our secured credit card comparison page to see deposit requirements, fees, and features side by side. At CreditSecuredZone, we help you make informed decisions about your credit-building journey.