Citi Secured Mastercard Review: A No Annual Fee Card to Help Build Credit

For consumers who don't have the best credit, Citi offers the Citi® Secured Mastercard®. Like most secured credit cards, you'll need to pay a deposit as collateral and can then build your credit score by making regular on-time payments. This Citi® Secured Mastercard® review breaks down what the card does well and where it could be better.

This credit card is a good fit for: Consumers trying to improve a poor or limited credit history without paying unnecessary fees.

Top perks

No annual fee: Many credit cards charge a fee every year to keep the account open, which is something you don't need while you're working on your credit. The Citi® Secured Mastercard® has no annual fee, so all you pay is the security deposit.

Can graduate to an unsecured card: Another important feature to look for in a secured credit card is the opportunity to graduate. Graduation is when the card issuer refunds your deposit and upgrades you to an unsecured card. This will happen if you pay on time and don't use too much of your available credit. If you can't graduate, you'll need to either cancel your card or let the card issuer hold on to your deposit indefinitely, neither of which is a good option.

You can graduate from the Citi® Secured Mastercard® to other Citi credit cards. It's not always the fastest process, with the typical timeframe being 18 months, but there are also cardholders who have graduated in under a year.

Choose your credit limit: The security deposit you pay when you get this card is your credit limit, and you can choose any amount between $200 and $2,500. It's helpful to have that kind of flexibility. You can pay less if you need to save money, or pay more for a higher limit to keep your credit utilization ratio lower.

Payments reported to all three credit bureaus: Citi reports your payments to the three credit bureaus that handle consumer credit scores: Equifax, Experian, and TransUnion. That means you can build a positive payment history with all three, instead of having one or two where your credit isn't improving.

Free FICO® Score tracking: Citi provides your FICO® Score free of charge so you can check your credit building progress. Your score is updated monthly by Equifax, so you can stay on top of whether it's going up or down.

Note that there are many different types of FICO® Scores, and the one Citi shows you is the FICO® Bankcard Score 8. This score ranges from 250 to 900, which is a bit different from the more commonly used range of 300 to 850. But don't worry, it will still give you an accurate idea of how good your credit is.

See more: Best No Annual Fee Credit Cards

What could be improved

Minimum deposit amount: You need a security deposit of at least $200 to open the Citi® Secured Mastercard®. This isn't a huge issue, but some consumers may need a cheaper deposit. There are secured credit cards that offer lower minimum deposit amounts, even under $100.

The ability to increase your credit limit: Citi won't let you increase your credit limit by adding to your security deposit. The amount you deposit when you get this card will be your credit limit for as long as you have it. That could be frustrating if you decide you want a higher credit limit later.

Foreign transaction fee: Since this card charges a 3% foreign transaction fee, it's not one you'd want to use while traveling internationally.

For more options, take a look at our picks for the best secured credit cards.

There's no minimum credit score to get the Citi® Secured Mastercard®. Although you can use this card to rebuild your credit, Citi won't approve your application if you have any bankruptcy history in the last two years.

Keep in mind that upon approval, you'll have 14 days to provide your bank account information and pay the security deposit.

See more: Best Starter Credit Cards for No Credit

The Citi® Secured Mastercard® will be a good fit if you're trying to either build your credit history or fix your credit after past problems, as long as all of the following are true:

• You can pay at least $200 to cover the security deposit.
• You don't plan to use your card internationally.
• You don't have a bankruptcy on your credit file within the last two years.

What's most important with credit cards for bad credit is that they allow you to raise your credit score without costing you money through dubious fees. By that standard, the Citi® Secured Mastercard® has everything you need.

Read more: Best Citi Credit Cards

Our credit card methodology

At The Motley Fool Ascent, we rate credit cards on a five-star scale (1 = poor, 5 = best). Our rating criteria includes rewards rates, welcome bonuses, fees, and perks like travel credits and 0% intro APR offers to evaluate our ratings.

We combine these factors with an evaluation of brand reputation and customer satisfaction to ensure you're getting the best card recommendations. Learn more about how The Ascent rates credit cards.