By the numbers: Consumer demand is strong for secured credit cards among both consumers who have had a credit card before and those who haven’t, per a PYMNTS Intelligence survey.

• Eight in 10 (80.8%) of consumers who once had a credit card are at least somewhat interested in getting a secured card.
• About the same share (81%) of people who have never had a credit card are also interested in acquiring a secured card.

Both groups primarily wanted the cards as a safety net in case of an emergency and to help improve their credit scores.

The opportunity: Secured cards provide issuers an opportunity to reach customers they may otherwise not have. There are 49 million US adults without conventional credit scores. Of those, nearly 19 million would be viable card prospects, per an analysis from Oliver Wyman conducted for Experian.

Some issuers are therefore trying to grow in this segment. For example, TD Bank upgraded the benefits for its TD Cash Secured Credit Card in August, hoping to attract new customers.

Our take: Given such wide demand and the large addressable market, secured cards can be a key growth driver for issuers if they can appropriately mitigate risk.

Issuers may want to partner with fintechs that provide alternative credit models to underwrite their secured cards. Factoring in things like income, bill payments and savings can help issuers better evaluate consumers’ creditworthiness and approve less risky candidates.

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