The Neo Secured Credit Card is one of Canada’s best-secured credit cards, specifically designed to meet the diverse financial needs of individuals aiming to establish or rebuild their credit history. In addition to aiding credit building, the card offers attractive features such as above-average cashback rewards, zero monthly fees, and guaranteed approval.
If you’re searching for a secured credit card that provides a secure and reliable path to improving your credit score and offers additional benefits, the Neo Secured Credit Card is an excellent choice.
In this comprehensive Neo Secured Credit Card review, we will delve into the intricacies of the card, covering its benefits, downsides, safety features, cashback rewards, welcome bonuses, and a comparative analysis with other secured credit cards available in Canada.
Neo Secured Credit Card – A Quick Glance
The Neo Secured Credit Card, Canada's first cashback secured card from Neo Financial, disrupts the norm by offering rewards. With a low $50 deposit, no annual/monthly fees, and guaranteed approval, it's an accessible credit-building option. The card, emphasizing online convenience, suits those building or rebuilding credit. Noteworthy, it stands out with no annual or monthly fees, instant approval, and solid cashback rates, providing a cost-effective and beneficial credit-building option.
- Earn an average of 5% cash back with Neo retail partners.
- No annual fee.
- Guaranteed approval as a secured credit card.
- Only requires a minimum security deposit of $50.
- No rewards at non-Neo retailers.
- No included insurance.
- Card not issued by a bank.
About Neo Secured Credit Card
The Neo Secured Credit Card, recently launched by Neo Financial, is Canada’s first and only secured credit card offering cashback rewards. In contrast to the usual trend where secured cards lack rewards or benefits, Neo’s card breaks this mould by providing cash-back rewards with solid earning rates.
Introducing a secured card seamlessly aligns with Neo Financial’s emphasis on online conveniences. This makes the Neo Secured Credit Card an excellent choice for individuals looking to build or rebuild credit, especially when their credit scores are less than ideal.
Adding to its appeal, the Neo Secured Credit Card has a remarkably low minimum required security deposit of just $50. This feature renders it a more accessible credit-building option than the typical $300 or more required by most secured credit cards.
This credit card also offers 5% average cashback at restaurants, bars and cafes, 3% on popular streaming services, 3% on ride-sharing services, 3% on food delivery services, and 2%+ at retail partners (online and in-store).
Beyond the attractive cashback feature, the Neo Secured Credit Card further distinguishes itself by waiving annual or monthly fees, making it a cost-effective choice. Additionally, the card guarantees instant approval, regardless of your credit score.
Benefits of Neo Secured Credit Cards
Let’s explore the distinctive advantages that make the Neo Secured Card a compelling option for individuals seeking to build credit and enjoy valuable perks along the way.
1. No Annual or Overlimit Fees to Pay
Unlike traditional secured credit cards burdened with annual fees ranging from $60 to $120, the Neo Secured Card is fee-free. This absence of monthly or annual fees and elimination of over-limit fees is particularly advantageous when significant funds are already allocated for the security deposit. The absence of an annual fee is a notable bonus, contributing to a more cost-effective financial strategy.
2. Earns Up to 5% Cash Back Rewards
the Neo Secured Card offers an average of 5% cash back when shopping at Neo’s extensive list of partners. From major retail names like The Home Depot and Hudson’s Bay to local favourites, restaurants, streaming services, gas stations, and grocery stores, your everyday purchases become opportunities to earn rewards.
3. Low Minimum Deposit
In contrast to other secured credit cards requiring deposits ranging from $200 to $500, the Neo Secured Card demands a modest $50. You have the flexibility to adjust this limit at your convenience, allowing you to increase or decrease it as needed, with a maximum cap of $10,000.
4. Upgrade Your Secured Card to Neo Premium
For a mere $4.99 a month, you can elevate your credit card experience by upgrading to Neo Premium. This enhancement offers even more rewards, including 3% cash back on gas and groceries, 0.5% everywhere else, and up to a 6% average cash back with Neo partners. Beyond enhanced rewards, Neo Premium provides additional perks such as credit score monitoring, life insurance, priority support, and more, enriching your financial journey.
5. 15% Welcome Bonuses from Certain Partners
Partnering businesses offer welcome bonuses of up to 15% cash back on your initial purchase. With no spending requirements or expiration dates, this enticing feature adds an extra layer of reward to your credit card experience.
6. Physical and Digital Cards
Neo Financial customers enjoy the best of both worlds with physical and digital cards. The convenience extends further as you can seamlessly integrate your digital (virtual) credit card into your favourite wallets, including Apple Pay or Google Pay.
7. No Hard Credit Check
Neo Financial stands out by avoiding the usual hard credit check. Using your card responsibly and making payments on time, helps keep your credit score moving in a positive direction without the negative effects of a hard inquiry.
8. Guaranteed Approval
Whether your credit score is less than perfect or you have no credit history at all, the Neo Secured Card ensures guaranteed approval. Notably, Neo Financial doesn’t check your credit, so you can apply without worrying about hard inquiries, making the application process stress-free.
Downsides of Neo Secured Credit Cards
Here are some notable areas that, while not deal-breakers, are worth considering before making a decision.
1. No Insurance Coverage Included with the Neo Secured Card
Secured credit cards usually don’t come with insurance perks, and the Neo Secured Card is no exception. However, considering Neo’s aim to stand out, the fact that it doesn’t offer basic insurance features like extended warranties or purchase protection is a noticeable area where they could add some extra benefits.
2. Rewards Exclusively Available Through Neo’s Partners
Although the Neo Secured Card has many partners, you can only get cashback rewards when you shop with them, which might limit your options. For those who prefer supporting local businesses over national chains, the inability to earn rewards on such purchases can be a downside.
Nevertheless, Neo addresses this concern by offering a top-up if your average cashback earnings fall below 0.5% across all purchases, providing a mitigating solution.
3. Very Limited Options for Redeeming Accumulated Cash Back Rewards:
Right now, you can only use cashback rewards as a statement credit. While statement credits are helpful, it’s a downside that there are no other ways to redeem your rewards, and the option to use cashback for shopping through the Neo Store is no longer available.
Neo Secured Credit Card Rewards
The Neo Secured Credit Card distinguishes itself in the Canadian credit card market by offering rare features and rewards. Here’s a breakdown of the cashback rates and bonus rewards you can expect:
- Average 5% Cash Back at Partner Retailers: Neo Secured Credit Card holders enjoy an impressive average of 5% cash back when purchasing at partner retailers. The extensive list of partners includes a diverse range of stores, making everyday spending an opportunity to earn rewards.
- Minimum of 0.5% Cash Back Across All Purchases: Cardholders earn a minimum of 0.5% cash back on purchases outside of partner retailers. This ensures that, for a no-fee card, users consistently benefit from a baseline cashback rate on all transactions.
- 15% Cash Back on First Purchases: New applicants are eligible for a special welcome offer—15% cash back on their initial purchases. This enticing offer is applicable at most Neo partner stores, providing a substantial boost to the cashback rewards.
- $25 Welcome Bonus: New applicants are rewarded with a $25 welcome cash bonus. This bonus adds an extra layer of immediate value for those entering the Neo credit card community.
Bonus Rewards from Select Partners:
Here’s a glimpse of the bonus cashback rates offered by Neo Secured Credit Card partners:
- Shoppers Drug Mart: 1%
- Loblaws: 1%
- Amazon: 2%
- SportCheck: 3%
- Dollarama: 3%
- Walmart: 1%
- Canadian Tire: 2%
It’s worth noting that with most partners, there is a cap on the maximum cashback that can be earned in a single purchase.
How to Apply for Neo Secured Credit Card
To apply for the Neo Secured Credit Card, you must:
- Be a Canadian resident of the age of majority in your province or territory.
- Provide a government-issued photo ID to verify your identity.
- Contribute security funds of at least $50.
Follow the steps below to complete your Neo Secured Credit Card application:
- Create a Neo account by signing up online or via the app using your email and phone number.
- Once logged in, click the “Neo Credit Card” button to apply for the Neo Secured Credit Card. Follow the prompts to choose your rewards program and credit card type (secured or unsecured).
- Provide basic personal and financial information, verify your identity, and set your credit limit. It’s essential to note that your security funds will serve as your credit limit. Depending on your spending habits, you can adjust your credit limit accordingly. Remember that the limit you set is not permanent; you can modify it whenever needed, adapting to changes in your financial situation.
With your Neo account set up, you can start making purchases and earning cashback on your transactions within Neo-partnered stores and elsewhere. Your cashback rewards can be cashed out at any time.
As you pay off your Neo Secured Credit Card balance each month, your payments will be reported to the credit bureau. This reporting can contribute to building your credit score over time.
Does Neo Report to Credit Bureau?
If you need a card that reports to TransUnion and Equifax, you can consider other alternatives to Neo Secured Credit Card in Canada.
Alternatives to Neo Secured Credit Card in Canada
Let’s explore how Neo Secured Credit Card compares to other notable contenders in Canada.
Neo Secured Credit Card vs Home Trust Secured Visa
Like Neo, the Home Trust Secured Visa offers a credit-building path without an annual fee and boasts a high approval rate. However, differences arise concerning the minimum security deposit and credit reporting. The Home Trust Secured Visa demands a substantial $500 minimum deposit and reports to TransUnion and Equifax. In contrast, the Neo Secured Credit Card sets a more accessible $50 minimum deposit but reports only to TransUnion.
Neo Secured Credit Card vs KOHO Prepaid Mastercard
KOHO presents a unique hybrid card with the option to add a credit-building feature called the KOHO-Credit Builder. While KOHO itself, as a prepaid card, does not contribute to credit building, the add-on comes at $10 monthly or $7 per month for users with an upgraded KOHO account. Although KOHO offers appealing features, individuals specifically seeking to build credit may find the no-annual-fee Neo Secured Credit Card a more straightforward and economical choice.
Neo Secured Credit Card vs Plastik Secured Visa Card
The Plastik Secured Visa Card also offers a rewards program, a rarity among secured credit cards. However, it comes with a substantial annual fee of $48 and a monthly maintenance fee of $6. This fee structure may be challenging, particularly for individuals with poor or non-existent credit history. In contrast, the Neo Secured Credit Card offers rewards without annual or monthly fees, positioning it as a more cost-effective choice.
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Final Thoughts on Neo Secured Credit Card Review
From its remarkably low minimum deposit requirement of $50 to the enticing cashback rewards program, the Neo Secured Credit Card offers a compelling solution for Canadians looking to build or rebuild their credit.
With a user-friendly application process, diverse rewards, and a commitment to financial accessibility, the Neo Secured Credit Card is a noteworthy choice for individuals on their credit-building journey.
If you’re ready to take control of your credit journey while enjoying the perks of a secured card, the Neo Secured Credit Card might be the right fit for you. Apply today and embark on a path towards financial empowerment and credit resilience.