Fifty-three million U.S. consumers don’t have a credit card and are known as “credit card outsiders.” This diverse group includes both younger people seeking to build credit and older, cautious consumers.
A PYMNTS Intelligence report, “Prime Candidates for Secure Credit Cards Include Young and Wealthy Consumers,” in collaboration with Atelio, illustrates how secured credit cards present a solution for these consumers, offering a controlled entry into the credit market. It also outlines strategies for financial institutions (FIs) to target these segments, particularly those looking to obtain a credit card for the first time.
Distinct consumer segments exist within the category of credit card outsiders, according to the report. These groups — such as “second-chancers” (individuals who previously had a credit card but lost it) and “credit-curious” consumers (those who have never had a credit card) — show interest in secured cards to build or rebuild credit.
The data is clear: 81% of second-chancers and credit-curious consumers express interest in secured cards, reflecting their openness to using this tool for credit management.
Even consumers who are less inclined toward credit, such as “gone for goods” and “never-nevers,” with no immediate plans to use credit cards, still show some interest — about 25% in each group.
Secured credit cards provide a controlled environment for these cautious consumers to rebuild their financial stability and manage emergencies. With clear terms and lower risks than traditional credit cards, secured cards represent an attractive option, especially for those looking for a safer alternative.
Younger consumers and higher-income individuals are particularly drawn to secured credit cards. Among Generation Z and millennial credit card outsiders, 61% and 67%, respectively, express interest in secured cards. These groups view secured cards not just to establish credit, but as tools for managing larger purchases and achieving long-term financial goals, such as qualifying for loans or mortgages.
Additionally, higher-income consumers — those earning more than $100,000 annually — show even greater interest, with 69% expressing a desire for secured cards. According to the report, this demographic values the structured approach secured cards provide, helping them avoid the risks associated with traditional credit cards while also allowing for more flexible financial management. In contrast, lower-income consumers (earning less than $50,000) show less enthusiasm, with only 41% indicating interest.
For financial institutions attempting to attract these credit outsiders, the key lies in understanding the motivations behind their interest in secured cards. According to the report, consumers across all age groups and income brackets seek secured cards to improve their credit scores. Nearly half of second-chancers and credit-curious consumers view secured cards as a potential primary payment method, helping them establish or rebuild their credit standing.
To engage these consumers effectively, FIs should focus on offering transparent terms, low fees, and strong customer support. The goal is to build trust by positioning secured cards as tools for achieving major financial milestones — whether it’s managing larger purchases or improving credit for future loans. Highlighting the benefits of secured cards as a controlled, low-risk financial tool will resonate across both younger, higher-income groups and more cautious, older consumers.
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