This decision guide builds on key personas PYMNTS Intelligence developed for prior reports on current credit card outsiders who are interested in credit in the future. Second chancers, for example, used to have a credit card and have at least some interest in having one in the future; credit-curious consumers have never had a credit card but share that interest.1
Data suggests that secured cards could play a critical role. Half of second-chancers and credit-curious consumers are already specifically interested in secured cards, making them very suitable segments to target.
However, FIs must build trust to convert these consumers. They can do so through transparent terms, personalized offerings and strong customer support that speaks to what these consumers want.
This guide will help FIs identify:
- Which types of credit outsiders are most interested in secured credit cards
- The demographics driving interest in secured cards, including younger and higher-income groups
- Why some credit outsiders prefer secured cards over traditional credit options
- How secured cards help outsiders build credit and achieve financial stability
- Strategies for FIs to tailor secured card offerings that appeal to different outsider personas
“Decision Guide: Engaging Consumers Interested in Secured Credit Solutions,” a PYMNTS Intelligence and Atelio collaboration, draws on an original survey of 2,630 U.S. consumers conducted from March 13 to April 2. This brief explores credit outsiders’ views on secured cards, FI engagement opportunities and best practices for tailored solutions.
Which Consumers Want Secured Credit Solutions
Younger and higher-income consumers lead interest in secured credit cards, but even cautious outsiders show potential.
PYMNTS Intelligence’s research finds that credit card outsiders fall into several distinct segments based on their credit experiences and future intentions regarding credit – the second chancers, credit curious, gone for goods and never-nevers. Secured credit cards can offer a controlled entry point for these consumers.
Data reveals that even though never-never and gone for good consumers purport to be out on the concept of credit, roughly one-quarter have at least some interest in a secured card. More than 4 in 5 second-chancers or credit-curious consumers likewise exhibit interest in a secured card.
This suggests that even the most credit-wary consumers see the value in secured cards’ structured, controlled way of managing money. Secured cards provide guardrails that help cautious consumers regain financial control and manage emergencies without the risks of traditional credit. FIs could benefit by promoting secured cards as a safer option for these groups.
Attracting younger or higher-income consumers
Generation Z consumers, millennials and higher-income individuals are eager to establish or rebuild their credit. Data shows that consumers see secured cards as a valuable financial tool — the reasons why are instructive. In fact, 61% of Gen Z and 67% of millennial credit card outsiders express interest in secured cards, primarily for building credit and managing larger purchases.
Additionally, the controlled access secured cards offer attracts 69% of higher-income consumers, who appreciate the structure and benefits without the risks of traditional credit cards.
These consumers are forward-looking, focused on improving their long-term financial health and seek flexibility. Consumers view secured cards as less of a safety net and more of an opportunity to achieve larger financial goals, such as qualifying for loans or mortgages.
Engaging consumers who are cautious but curious
We tend to find caution in how older and lower-income individuals approach credit. Despite this hesitancy, many are open to using secured cards for specific needs. Half of baby boomers and seniors express interest in secured cards. Likewise, 41% of lower-income consumers find them appealing for managing emergencies and essential purchases.
This group prefers products that offer clear terms and low fees. Secured cards provide a low-risk way to regain financial stability or address pressing financial needs, such as unexpected expenses. While wary of credit, these consumers find value in having a safety net for financial emergencies and appreciate lender transparency.
Actionable Insights
Interest in secured cards aligns with interest in general credit options.
Outsiders who express interest in secured cards and those interested in general credit cards overlap often. For example, 81% of second-chancers and credit-curious consumers are also somewhat interested in obtaining a secured card. This convergence highlights the link between seeking general credit and considering secured cards as part of a broader approach to personal finance.
There are a lot of commonalities regarding why consumers from every credit persona could want a credit card. Consumers across all four personas most broadly named having access to more resources for emergencies as a factor driving their interest. Overall, that data suggests credit card outsiders of all stripes see the same use cases as valuable. Key differences include gone for goods being less likely to want a way to make larger purchases and never-nevers reporting low interest in getting a credit card to preserve a cash cushion.
FIs should capitalize on this overlap by positioning secured cards as part of a comprehensive credit strategy that can offer these broad benefits while maintaining protective guardrails.
Gen Z and millennials drive interest in secured cards.
Gen Z and millennials are three times more likely than baby boomers and seniors to show interest in secured cards. Sixty-one percent of Gen Z and 67% of millennials are interested, viewing these cards as essential for building credit and managing purchases.
Just 20% of baby boomers and seniors express interest in secured cards, showing even less interest than some never-nevers. For FIs, targeting Gen Z and millennials should be a priority. These younger groups look to secured cards as tools for achieving major financial goals, like securing loans or handling emergencies. By focusing on these audiences, FIs can capture the segments most hungry for these types of financial flexibility.
Higher-income consumers show more interest in secured cards than lower-income consumers.
Sixty-nine percent of high-income consumers — those whose annual income exceeds $100,000 — express interest in secured cards. Among consumers with incomes less than $50,000, 41% exhibit interest in secured cards. This suggests that higher-income individuals may better understand or be more drawn to the advantages of secured cards, particularly in managing larger purchases and improving credit. In contrast, low-income consumers might perceive potential drawbacks and negatives more strongly.
However, secured cards can allow all consumers to manage larger purchases and build credit in a controlled way. FIs should emphasize secured cards’ flexibility, safety and rewards to persuade high-income consumers to reap these benefits.
Consumers seek secured cards to improve their financial standing.
Improving credit scores is a primary reason consumers seek secured cards. Our research finds this spans all age groups. Nearly half of second-chancers and credit-curious consumers believe a secured card could become their main payment method.
Using secured cards as tools to work toward major financial milestones particularly appeals to Gen Z consumers. These include obtaining housing or paying for purchases over time.
Given these shared interests and desires, FIs should position secured cards as tools for improving credit, achieving financial stability and managing emergencies. This message resonates with a wide variety of consumers, young and old.
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Methodology
“Decision Guide: Engaging Consumers Interested in Secured Credit Solutions,” a PYMNTS Intelligence and Atelio collaboration, is based on a survey of 2,630 U.S. consumers conducted from March 13 to April 2. The survey sought to understand the consumers who do not have credit cards, how not having access to credit cards impacts their financial lifestyle and which credit products, if any, they would be interested in. The sample was balanced to match the U.S. population in a number of key variables.
1. [For more information on the personas of second chancers and credit curious, see “How FIs Can Identify and Attract Credit Card Outsiders” and “Who Is the Credit Card Outsider? … And How Do They Get Access?” PYMNTS, 2024.]↩
