Discover it Secured is better than Indigo Platinum because you can earn cash-back
If you're struggling with a bad credit score you might not think there are any options for you to get a credit card.
Your bad credit history is probably interfering with your ability to borrow the funds you need to do what you want in life.
There are many bad-credit credit cards specifically designed to help people to improve their poor credit scores.
We put together a list of all bad-credit credit cards over at CreditLoan, which I think you'll enjoy checking out.
Very few of those cards offer cash-back rewards for users.
And if the card does offer any rewards, it charges you a hefty annual fee.
The cash-back you earn might only barely cover the fee.
Both are cards designed to help people repair their bad credit.
But there's a difference between the Discover it Secured card and other cards for people with bad credit, like the Indigo Platinum: the Discover it Secured card lets you earn cash-back on your purchases.
And it doesn't charge an annual fee like the Indigo Platinum does.
Why Discover it Secured is Stronger
The Discover it Secured is stronger than the Indigo Platinum because it has no annual fee and you can earn cash-back
Cash-back rewards credit cards are usually offered to people with "good" or "excellent" credit scores (between 690 and 850).
People with "poor" or "fair" credit scores usually don't expect to be offered a credit card that lets them earn cash-back.
The Discover it Secured card changes that.
With bad credit, still earn cash-back rewards. If a person with bad credit is able to muster a security deposit, they are able to earn cash-back on what they spend on the card.
The cash-back rates are quite good, with 2% cash back on purchases at gas stations and restaurants, and 1% for everything else.
Avoid that dreaded annual fee. Those cash-back rewards wouldn't mean so much if you had to pay an annual fee.
You'd have to spend quite a bit just to earn enough cash-back to cover the annual fee.
But with no annual fee, the Discover it Secured doesn't eat into the cash-back you earn.
The Indigo Platinum card doesn't let you earn cash-back and you'll most likely be charged an annual fee.
People love the Discover it Secured because you can earn cash-back and it's matched in the first year
There's more than just the chance to earn 1%-2% cash-back on the Discover it Secured card.
The money you earn in year 1 gets matched. The Discover it Secured card matches all the cash-back you earn in the first year dollar-for-dollar at the end of the year!
Graduate to unsecured without having to apply for a new card. It's normal for a secured credit card to get converted to an unsecured card if you make on-time payments.
Customers also love that the Discover it Secured card gives you the chance to upgrade to an unsecured card after eight months.
The biggest customer complaint about the Discover it Secured is that it can take a while to get back your deposit
Even though you can qualify to upgrade to an unsecured card and get your deposit back after 8 months, it doesn't mean it's always going to happen that fast.
Customers complain that even with a 100% payment history they have still not been upgraded until well into year 2.
Put down a deposit and start earning cash-back while building your credit. If a person with bad credit can afford a deposit this is a great card for them.
They'll get 1-2% cash-back and it will be matched at the end of the year.
Plus, there isn't an annual fee to eat away at the cash-back they earn.
Then again, Indigo Platinum doesn't require a security deposit
With a secured card like the Discover it Secured you provide a security deposit of $200-$2,500.
That's exactly the limit of the amount you can borrow. So if you don't pay it back, the deposit is there to cover you.
A lot of people with bad or fair credit probably don't have $2,500 lying around to secure a credit card limit.
This is where the Indigo Platinum comes in handy.
You can get this card with a "poor" or "fair" credit score and you don't have to put down a deposit.
Then you can start building your credit score back up by using the card and keeping it paid off.
However, keep in mind the trade-off, which is an annual fee that can be up to $99 per year.
People love Indigo Platinum because they can use it to increase their low credit score
The Indigo Platinum card is designed for one thing and one thing only: to build back bad credit.
People who have damaged credit can repair it by creating a record of responsible credit behavior.
According to the blog Debt Roundup, using a credit card responsibly is always recommended for increasing your credit score.
Customer reviews include many stories of people with terrible credit scores who boosted them in a fairly short amount of time.
They used the card and paid it off early and their credit scores improved.
I really recommend taking a few minutes to read, Why is My Credit Card Standing Important to My Credit Card Search?
You'll learn how your credit score affects not only your credit card choices but also your life!
The biggest customer complaint about Indigo Platinum are the fees
Customers call the fees charged by the Indigo "ridiculous." The credit limit for an Indigo Platinum card is $300.
As soon as you open the account, the entire annual fee is charged to it.
Annual fees are usually $75 in the first year and $99 every year after that.
So people open an account with a credit limit of $300 and find there is only $225 available.
The only goal you should have with the Indigo Platinum card is to use it to build your credit.
If you want anything more than that, or if you don't want to be charged an annual fee, you should be choosing the Discover it Secured.
How Discover it Secured compares to Indigo Platinum
|Discover it Secured||Indigo Platinum|
|How high of credit score do you need?|
Poor credit (300-549) can be approved
Limited Credit/Bad Credit/No Credit can be approved
10.99% first 6 months
$75 (year 1) $99 (after year 1)
|How big of sign-up bonus do you get?|
All points earned in year 1 are matched after 12 months
|How much do you need to spend to get the bonus?|
There is no minimum, all year 1 points earned are doubled
|How many points do you get for every dollar?|
2 points per dollar for gas and restaurants
1 point per dollar for everything else
2 points earned up to $1,000 in combined purchases at gas stations and restaurants per quarter
|If you spent $100 on the card, then how much would the points be worth in dollars?|
$2 for gas and restaurants $1 for everything else
|How much would you need to spend on the card to make up for the fees (excluding APR/rates)?|
About the Companies
The issuer of the Discover it Secured is more highly rated than the issuer of the Indigo Platinum card
Discover gets top marks. The Better Business Bureau gives Discover Financial Services an A+ rating.
The Indigo Platinum card is issued by Celtic Bank, which only has a B+ rating with the BBB.
About the Discover it Secured card
Discover was a disrupter to start. The original Discover card was started in 1985 by Sears.
Unlike the other major credit cards, it had a higher credit limit and charged no annual fee.
The Discover card was the first credit card to offer cash-back rewards.
Today, the Discover it Secured card is one of the only credit cards for low-credit customers that doesn't have a fee and earns cash-back.
You're the perfect customer for the Discover it Secured if you have a low credit score but can afford a security deposit
Use your money to build your credit. If you can afford to put down anything from $200-$2,500 as a security deposit, you don't have much to lose by getting the Discover it Secured card.
The blog Wallet Hacks identifies secured credit cards as a smart way to build low credit scores back up.
If you pay off the monthly balance by the due date you'll do more than just avoid paying interest — you'll increase your credit score.
Each payment will get reported to all three of the credit bureaus and your FICO score will rise.
In 8 months you can get bumped up to an unsecured Discover it card and have your deposit returned.
About Indigo Platinum
That's it, just one card. There is only one Indigo card, the Indigo Platinum Mastercard.
The card is designed to give a "second look" at low credit customers who can't access financing anywhere else.
You're the perfect customer for Indigo Platinum if you have a low credit score and can't afford a security deposit
Last chance for credit. The Indigo Platinum card is a last-chance credit card for people who can't access credit because of their low score.
The $75-$99 annual fee is the price cardholders pay to be able to have a credit card. If they use it responsibly they can build their credit back up.
How the Services Compare
What are the core services offered by Discover it Secured and Indigo Platinum?
They share one core service. Both of these cards share the same core service: offering a credit card to low-credit customers to help them repair their credit scores.
The good and the bad about Discover it Secured card's core services
The Discover it Secured card's core services are pretty straightforward.
Your deposit determines your credit limit. Your credit limit is completely determined by the amount you can put down for a security deposit.
So, if you can put down $200 that's your limit. If you can put down $500 that's your limit. It goes all the way up to $2,500.
Once you get past the six-month, 10.99% introductory APR rate, the APR for purchases will be 23.99%.
That's pretty high.
But the goal for people with this card should be to pay off their balance in full each month. If they can do that they won't get charged interest.
Be on your best behavior and graduate. Then in as little as 8 months of perfect credit behavior, you could be offered to upgrade to a Discover it unsecured card. You'll get your deposit back in full.
The good and the bad about Indigo Platinum's core services
It depends on the card agreement you're offered. There are actually three different sets of terms a customer can qualify for when they apply for an Indigo Platinum card.
Each of the three versions offers the same APR of 23.90% (that's just a hair off the Discover it Secured's 23.99% APR).
The fees make the difference. The only difference between the three possible offers is the annual fee.
The first version has no annual fee.
The second possibility is an annual fee of $59.
The third has an intro annual fee of $75 for the first year and then a $99 fee every year after that. There is only one credit limit offered by the Indigo Platinum card, and it's $300.
A higher credit limit means a higher credit score. If you can afford a security deposit, the Discover it Secured card can get you a higher credit limit.
That will help you build your credit faster since your credit utilization score will be lower.
Just make sure you don't carry a balance or you'll get charged the high APR.
Whose Rewards and Bonuses are Stronger?
What are the types of rewards and bonuses offered by the Discover it Secured and Indigo Platinum?
It's no contest when it comes to rewards. This is the category where the Discover it Secured simply blows away the Indigo Platinum card.
That shouldn't be too hard considering the Indigo Platinum card has zero rewards for its customers.
The good and the bad about the Discover it Secured rewards and bonuses
Discover it Secured has impressive cash-back for low-credit consumers. The Discover it Secured card is unique because it gives low-credit customers the chance to earn decent cash-back. All that with no fee!
Cardholders earn 2% cash-back on all purchases from restaurants and gas stations on up to $1,000 each quarter.
Then everything else earns you 1% cash back.
Those are competitive cash-back rates for any card.
And then after a year, double your dollars. But here's the kicker: at the end of the first year, whatever you have earned in cash-back is matched dollar-for-dollar.
Let's say you just maxed out the 2% you can earn on $1,000 in gas and restaurants each quarter. You'd get an extra $80 statement credit at the end of the first 12 months!
The good and the bad about the Indigo Platinum rewards and bonuses
Look for rewards elsewhere. The Indigo Platinum card is not going to earn you any points, miles, or cash-back.
But it will give you the chance to build your credit back up so you can qualify for a rewards card someday.
Why wait to earn cash-back? If you can afford the security deposit, you don't have to wait to build your credit back up to start earning cash-back.
And the Discover it Secured card doesn't even charge an annual fee, which means you keep everything you earn.
What Benefits are Most Notable?
What are the benefits offered by the Discover it Secured and Indigo Platinum?
Both of these cards come with some basic benefits, but the ones offered by the Discover it Secured card are really helpful for people with low credit scores.
The good and the bad about the Discover it Secured benefits
Get the information you need when you're trying to raise your score. With the Discover it Secured card, you get free FICO credit score monitoring.
That's a good feature considering most people who have this card got it to help build their score.
Another great feature for low-credit score folks is the automatic review that happens every month after the first 8 months.
If your score has improved you can get your deposit back and get bumped up to an unsecured Discover it card.
The bad part is there is no price protection or extended warranty protection, which the Indigo Platinum card has.
The good and the bad about the Indigo Platinum benefits
There are just a couple of benefits. The Indigo Platinum card is a Mastercard, so it does come with a couple of standard benefits.
Price Protection means that if you can find a better price within six months of a purchase, you'll be reimbursed the difference.
Extended Warranty Protection means that any warranty you get when purchasing a product is doubled.
Some benefits are better for low credit score customers than others. Neither of these cards have a lot of benefits. But the Discover it Secured's credit score tracking and monthly assessments are benefits that are really well suited for low credit customers.
Costs & Fees
What are the costs and fees associated with the Discover it Secured and Indigo Platinum?
Comparing annual fees is another category that the Discover it Secured takes easily. That's because it doesn't charge any.
The good and the bad about the Discover it Secured card's costs and fees
Unlike a lot of cash-back rewards cards, the Discover it Secured card doesn't charge any annual fee.
No annual fee is also really rare for credit cards that are designed to help people with poor credit.
Other fees are also waived. There is no foreign transaction fee charged by the Discover it Secured card.
You also don't get charged a late fee for your first late payment or for going over your limit, although after that you get charged $37 for a late or returned payment.
And paying late won't raise your APR.
Although there's no balance transfer fee for the first six months after you sign up, after that, it's 3% of the amount of the transfer.
The good and the bad about the Indigo Platinum costs and fees
It's a bit confusing because there are three sets of terms. You'll get offered one of the terms based on your application information.
For one offer, there is no annual fee charged. For the second offer, an annual fee of $59 is charged.
You'll probably get offered the third one. The third offer is actually the only one we've ever heard of anyone getting. It charges a $75 annual fee in year one and $99 every year after that.
There are a few other fees to consider. One surprisingly great thing is that the Indigo Platinum card doesn't charge any fee for cash advances in the first year you have the card.
After that it's the greater of $5 or 5% of what you get advanced.
Late payment, over-limit, and returned payment fees are up to $38. Foreign transaction fees are 1%.
With no annual fee, the Discover it Secured prevails in this department.
Add that to the cash-back rewards and you've got a card that can actually earn you money – even with a lousy credit score.
What kind of customer service can you expect with the Discover it Secured and Indigo Platinum?
Unfortunately, it looks like another trade-off people with low credit have to make when they sign up for the Indigo Platinum card is in the quality of customer service.
On the other hand, Discover it Secured customer service seems to be pretty good.
The good and the bad about Discover it Secured customer service
Consumers of the Discover it Secured card appreciated getting approved very quickly. Customer service is easy to connect with and the reps are described as helpful.
The best thing customers appreciate is getting told that they have ‘graduated' to a higher credit limit and that their deposit will be refunded.
The Discover card makes a point to indicate that its customer service reps are all in the United States.
The good and the bad for Indigo Platinum customer service
Indigo Platinum customers complain that when they call the customer service line they get busy signals or can't get through.
Some say they call a number and it is out of service.
Similar complaints are made about the website being down for weeks and being unable to make online payments.
Emails get bounced back.
Indigo is a service landmine. It sounds like there are some serious communication issues with Indigo Platinum, so be aware of that if you're signing up.
Key Digital Services
What special digital features can you expect with both the Discover it Secured and Indigo Platinum?
It's pretty standard these days to be able to manage your credit card accounts online. Both of these cards offer that option.
However, the Discover it Secured card also has a mobile app and digital wallet.
The good and the bad about the Discover it Secured digital services
The Discover it Secured card offers its cardholders an online portal for managing their account.
But it also has a mobile app that lets you do everything from paying bills and transferring funds to monitoring and even redeeming your cash-back rewards.
You can also do mobile payments with your Discover it Secured card if you use it with a digital wallet app.
The good and the bad about the Indigo Platinum digital services
Indigo Platinum has an account management site you can access with your computer or mobile device.
Once you've registered you get 24/7 access to your account info.
That includes reviewing your transactions and monitoring your account activity.
You can pay your bill online for free through the site.
The Discover it Secured card has a mobile app and the Indigo Platinum card doesn't.
That pushes the Discover it Secured over the top when it comes to which offers the best digital technology.
Getting started with the Discover it Secured and Indigo Platinum
Both of these cards offer you the chance to prequalify without it impacting your credit score, so even if you're on the fence, there's no downside to checking out both.
The best way to begin with Discover it Secured
Pre-approval doesn't hit your credit score. Before you go ahead and apply for the Discover it Secured card you can check if you can be pre-approved.
Applying for pre-approval doesn't get reported to the credit bureaus so it won't affect your credit score.
If you get pre-approved you can move on to the application.
You might want to save up first. It's important that you put down as big a security deposit as you can possibly afford.
The amount you have available versus the amount you use impacts 30% of your credit score. So if you have to save up a bit before applying it might be worth it.
How best to begin with Indigo Platinum
The Indigo Platinum also lets you prequalify. Many people receive offers in the mail indicating that they've been pre-approved.
Applying online for pre-approval doesn't impact your credit score. When you get it, you'll learn which of the three card agreements you're being offered.
How to Cancel
The easiest way to cancel the Discover it Secured and Indigo Platinum
Here are some tips on how to best go about finishing with these cards once your credit has been improved.
Canceling the Discover it Secured card
To close your Discover it Secured account, you need to call 1-800-DISCOVER.
There are no fees for closing your account and you get your security deposit back once you've paid everything off in full.
If you've already earned cash-back rewards it is credited to the account.
However, if you're hoping to get the dollar-for-dollar matching at the end of the year you have to have an active account.
So you might want to hold off on closing it until the end of the first 12 months.
But your best bet for finishing with this account is to graduate up to a Discover it unsecured card where you can earn up to 5% cash-back.
Getting bumped up gets you your deposit back and you're not reported as applying for a new card (which would hurt your score).
Finishing with the Indigo Platinum
Indigo Platinum doesn't provide any instructions online for canceling. Logically, your first step should be contacting the customer service line at 1-866-946-9545.
We recommend canceling this card as soon as your improved credit limit lets you get another. Hopefully, that is before you get hit with a new annual fee.
What security features come with each of these cards?
Indigo Platinum has an Identity Theft Resolution System that helps you recover if you're a victim. It also has Zero Fraud Liability so you won't be liable for unauthorized use of the card.
The Discover it Secured alerts you if your Social Security number is being used on risky websites. It will also alert you if new accounts are opened in your name.
There's also a "Freeze It" service that lets you switch off your account for purchases immediately. And it offers 24/7 Fraud Protection.
How much APR is charged for cash advances with each card?
The Discover it Secured card charges 25.99% on cash advances. Indigo Platinum charges 29.9% on cash advances.
Is either of these cards good for balance transfers?
The Discover it Secured gives you six months at 10.99% APR for balance transfers. But after that, you'll be paying 23.99% APR. There is no option to transfer a balance on the Indigo Platinum card.
We would recommend one of our recommend balance transfer credit cards if you're thinking of transferring a balance from one card to another
Can someone who has been through bankruptcy get approved for either of these cards?
Yes, people who have experienced bankruptcy can still be considered for both of these cards.
If you can afford a security deposit, go for the Discover it Secured
There are so many reasons why the Discover it Secured is superior to the Indigo Platinum card.
It's got no annual fee, you can earn cash back on purchases, the customer service is good, and there is an opportunity to graduate to an unsecured card after 8 months.
But if you can't afford a security deposit, then you might have no choice but to go with the Indigo Platinum card to rebuild your credit.
That's the only scenario we can think of where you'd choose it over the Discover it Secured.
Do you use either the Discover it Secured or Indigo Platinum card?
How has it worked out for you?
Any great tips (or nightmares) to share with the rest of us?
Let us know in the comments below.