An HSBC secured credit card is a perfect credit card for someone who has a less than perfect credit history. With this card, consumers get all of the benefits of a traditional credit card, but they face few of the risks and restrictions. The reason for this difference is that this type of credit card works slightly differently than a standard credit card.
When a consumer uses a standard credit card, they get to use that card to pay for goods and services. Each month, the credit card company who issued that card will send the consumer a statement detailing how much they spent and how much they owe. If they desire to do so, the consumer can opt to pay off the entire balance each month and face no interest charges. Alternatively, they can pay a small percentage of the charges, and they can accept interest charges on the rest of the balance. Consumers who used an HSBC secured credit card will experience a slightly different experience.
When a consumer gets a HSBC secured credit card, in contrast, they do not get to spend money that they do not have as they would with a regular credit card. Instead, they send HSBC some money in advance. The amount of money may vary. It may be as little as $300 or as much as $10,000. That money is placed into a secure savings account, and the consumer gets to spend that money by using their credit card.
Of course, a consumer could simply place money in his or her own personal savings account, and they could spend that money. However, if they opted to do that, they would not get the advantages offered by an HSBC secured credit card. When a consumer uses their secured credit card, their credit report is updated just as if they were using a regular credit card. This improves their credit score. Thus, using a secured credit card is a great way to build up your credit history without taking any personal risk.
There are certain instances where a consumer simply needs a credit card. Most car rental places, for instance, require their customers to secure their rental by using a credit card. Many utility companies or cell phone companies have similar requirements. With a secured credit card, consumers can fill these requirements easily.
Getting a secured credit card is also easier than getting a standard credit card. Typically, when a consumer applies for a conventional credit card, they have to prove that they have a good credit history, and they have to prove that they make enough money to repay the amount that they are going to borrow. With a secured credit card, however, the consumer does not have to worry about their credit history, and they usually do not face any income requirements. If you want the convenience of a credit card without having to worry about your income or your credit history, you need a HSBC secured credit card. They are relatively easy to obtain, and they can improve your credit score.