What is a potential benefit of using a secured credit card?

A secured credit card is designed primarily to help individuals build or improve their credit scores. By requiring a security deposit that typically acts as your credit limit, it reduces risk for lenders, making it easier for those with limited or poor credit history to obtain credit. The benefit of credit building with lower interest rates refers to the fact that, while many secured credit cards may come with higher interest rates compared to unsecured cards, responsible use—such as making on-time payments and keeping balances low—can lead to improved credit scores over time. As your creditworthiness improves, you may qualify for other credit products with better terms.

Additionally, regular reporting of your payment history to credit bureaus helps establish a positive credit profile. Consequently, the primary function of a secured card is to facilitate this improvement in credit history. The other options may not accurately reflect what secured credit cards typically offer, as guaranteed high credit limits often aren't a feature, easy approval without credit check can vary, and cash withdrawal capabilities may not be the primary focus or may come with additional fees.