The secured credit cards are backed by a collateral deposit against the risk of default in repayment by the cardholder. Each card is liable to be repaid by the cardholder with the amount of purchases being made.
What is a credit card?
A card, or a form of plastic money, issued by a financial institution in such a way that the person to whom such card is issued can utilize it to purchase goods and services on credit, is known as a credit card.
A secured credit card is a safe and risk-free form of issue for the issuer, as it is covered by a security deposit as a collateral. Repayment is done either out of the deposits, or by manual payment by the cardholder.
Hence, the significance of a credit cards is given.
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