Which of the following statements is most correct regarding a secured credit card?
A)It is a valuable form of credit insurance - you are protected against loss if the card is lost or stolen.
B)It is useful to someone who has bad credit or no credit established yet.
C)It provides a higher level of user security,using technology to prevent illegal use.
D)Compared to non-secured credit cards,it always carries a much lower rate of interest.

Question

Quizplus · Accepted Answer

A secured credit card is useful to someone who has bad credit or no credit established yet because it requires a security deposit which becomes the credit limit. This means that the issuer is protected if the cardholder defaults on the payments. Therefore, the issuer is more likely to approve the application of someone with bad credit or no credit history.

Which of the Following Statements Is Most Correct Regarding a Secured