Financial institutions offer the secured MasterCard to individuals who do not qualify for a normal credit
card. A secured MasterCard allows the user to enjoy the benefits of a credit card, while building a healthy credit record.
How to Apply for Secured MasterCard Credit Card
A secured MasterCard application does not require credit checks or sound financial history. Therefore, almost every adult can
apply for a secured MasterCard. Again, due to the above mentioned reasons, financial institutions readily approve a secured
MasterCard application.
The secured MasterCard facility is not available in every country or with every banking institution. One has to, therefore,
look for a secured MasterCard partnering institution. This card is secured in a way that the issuer guarantees payment returns
against credit card purchases. To this effect, an applicant has to deposit money in a savings account or obtain a certificate of
deposit (CD). The amount deposited with the issuer will define the credit limit of a secured MasterCard. The deposited money will
also earn interest over time.
Once the application is approved, the financial institution sends a secured MasterCard to the applicant’s mailing address.
How Does a Secured MasterCard Work
A secured MasterCard appears and works exactly as a normal credit card. Users can make purchases by swiping the card or
through the Internet or phone. Payments through a secured MasterCard are billed monthly. The cardholder is required to pay
outstanding bills before the due date, failing which the amount is deducted from the deposit money. This will lower the purchase
limit of the secured MasterCard.
Timely bill payments also help in generating a favorable credit history. The issuing institution observes your secured card
usage over a period of time, say one year. Good performance is rewarded with an unsecured MasterCard. The credit history is also
forwarded to credit bureaus that will play a crucial role in future borrowings.
The secured MasterCard comes with high interest rates and 19.5% basic APR (annual percentage rate). A secured MasterCard user
does not enjoy a grace period for the payment of the outstanding amount. The bank will also charge you for the sign up process,
exceeding credit limit and late payment of bills.
Benefits of the Secured MasterCard
Some of the basic benefits of a secured MasterCard are:
- Global acceptance.
- No liability against unauthorized charges.
- Lost or stolen card reporting service.
- 24-hour assistance and emergency services.
- Account information on the Internet or phone.
- Enhanced security with MasterCard SecureCode.
‘MasterCard’ is trademark of MasterCard, who can be found at www.mastercard.com