The Win-Win of Secured Credit Cards for Businesses and Canadian Consumers

What is a Secured Credit Card?

Think of a secured credit card as training wheels for building credit. It works just like a regular credit card—cardholders can use it for everyday purchases, pay off their balance, and build a credit history. The key difference? It requires a security deposit, which acts as collateral.

For example, if someone puts down a $500 deposit, that amount typically becomes their credit limit. They can use the card just like any other credit card, and as they make payments, their activity is reported to credit bureaus, helping them build or rebuild their credit over time.

This is what makes secured credit cards different from prepaid cards. A prepaid card is just loaded with funds—there’s no impact on credit history. A secured credit card, on the other hand, is a stepping stone to better financial opportunities, eventually helping users qualify for regular credit cards, car loans, or even mortgages.

For businesses, offering a secured credit card program means giving customers a practical way to access credit while building long-term financial health. It’s a win-win: customers get the chance to improve their credit, and businesses get to offer a valuable service that fosters loyalty and trust.

Who Benefits from Secured Credit Cards?

Secured credit cards aren’t just for people with bad credit—they’re a lifeline for anyone trying to establish or rebuild their financial standing. Let’s explore who benefits most and where the demand is. 

1. Newcomers to Canada

Moving to a new country comes with challenges, and one of the biggest is navigating a financial system without any credit history. Many newcomers struggle to qualify for loans, rentals, or even phone plans. A secured credit card provides them with a way to start building credit from day one, helping them integrate into the economy faster.

2. People Rebuilding Their Credit

Life happens. Job loss, unexpected expenses, or past financial mistakes can damage credit scores. For those trying to recover, a secured credit card offers a second chance. According to a recent report, 81% of “second-chancers” and “credit-curious” consumers—individuals who previously had a credit card but lost it or those who never had a credit card—express interest in secured cards as a way to rebuild their credit.

3. Young Adults and First-Time Borrowers

Many younger consumers have never had a credit card before and need a way to prove their creditworthiness. Among Generation Z and millennials, 61% and 67% respectively are interested in secured cards. A secured card gives them a low-risk way to start building credit, teaching responsible financial habits without the fear of overspending.

4. High-Income but Credit-Cautious Consumers

Surprisingly, even individuals earning over $100K annually may prefer secured cards. Nearly 70% of higher-income consumers show interest in secured cards, valuing their structured, controlled nature. This demographic sees secured cards as a way to manage finances prudently while avoiding the pitfalls of traditional credit.

For businesses, these diverse customer groups represent a massive, growing market. Offering a secured credit card program can help people take control of their financial future while strengthening your brand loyalty and trust.

Should Your Businesses Offer Customers Secured Credit Cards?

Offering a secured credit card program can be a significant strategic growth opportunity. Many businesses already serve customers who need help building credit, making secured cards a natural fit.

For example, fintech platforms helping consumers manage their finances can integrate secured credit cards as part of their product suite. Newcomer settlement services that assist with banking, housing, and employment can offer secured cards to help immigrants start building credit immediately. Alternative lenders and loan providers can introduce secured credit cards as a way for customers to improve credit scores, eventually qualifying for larger loans and better rates.

Long-Term Business Benefits

A secured credit card program does more than just expand your customer base—it strengthens relationships and keeps customers engaged with your brand longer. When customers start their credit journey with your business, they are more likely to continue using your services as they move toward traditional financial products.

Additionally, businesses that offer secured credit cards can:

• Create new revenue streams through interest, fees, and cross-selling opportunities.
• Improve customer retention by offering a structured path to better financial health.
• Differentiate from competitors by providing a high-value financial tool that builds trust and loyalty.

As financial inclusion becomes a bigger focus, businesses that act now will be ahead of the curve, attracting customers and positioning themselves as trusted financial partners.

How Digital Commerce Payments Makes It Easy

Launching a secured credit card program doesn’t have to be complicated. Digital Commerce Payments offers a turnkey, white-label solution that allows your business to seamlessly integrate secured credit cards into your offerings.

Our platform provides:

• End-to-End Card Issuing and Processing – From card production to transaction management, we provide the platform to handle the heavy lifting.
• White-Label Customization – Brand the card, customer portal, and mobile experience to match your business.
• Seamless Integration – API-powered technology ensures a smooth connection to your existing platforms.
• Compliance and Security – use our tools like encryption, tokenization and compliance-as-a-service to secure your offering and assist with regulatory compliance.

Ready to launch your secured credit card program? Contact us today to get started.