If you are just starting your credit history, or if you have a bad credit rating on your credit history report, then you may need a bad credit card. In such a situation, a secured credit card is the most helpful in improving your credit rating. To get a secured bad credit card, you will need to create and maintain a savings account.

The most common example of a secured card is a debit card.

With a secured bad credit card, the cardholder deposits a fixed amount of money, ranging from $500 to $1000, in his or her account with the card holding company. When any purchase is made, then the cardholder draws money from this account. Since the credit card company is not required to supply any of the funds for any of the transactions made, they do not face any risk. You need to keep on depositing funds periodically in the account so as to continue using your secured bad credit card.

Secured bad credit cards are usually easier to obtain because you supply the capital that you will be charging against. Though the process of a secured card is simpler, it is costlier when the fee is included. Thus, sometimes, an unsecured bad credit card is more convenient. However, unsecured credit cards are offered only to borrowers with a good credit history, and reliable employment.

Be very careful when applying for these kinds of credit cards as their fees can be quite high. Before applying for the card, you must find out the total fees, and also find out whether it would be refunded if your application is denied.