Neo Secured Credit Card Review

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The Neo Secured Credit card has quickly established itself as one of the best secured credit cards in Canada. Not only does the card have no annual fee, but it also has a low deposit requirement of just $50. Plus, you can earn cash back rewards at over 12,000 Neo partners.

Although Neo Financial may not be a name that’s familiar to all Canadians, the bank has quickly established itself as a significant challenger. Read my Neo Secured Credit card review now for the full details.

Neo Secured Credit Card

  • No annual fee
  • Up to 15% cash back on first-time purchases at participating partners
  • 5% Average cash back at over 12,000 Neo partners
  • 0.5% minimum cash back guarantee (up to $50 per month)

Welcome bonus and earn rate

Instead of having a traditional welcome bonus, the Neo Secured Credit card gives you up to 15% cash back on first-time purchases at participating merchants. Although this is a one-time bonus, you don’t need to worry about taking advantage of the offer in a set time like other welcome bonuses.

As for the earning rate, Neo says you’ll get an average of 5% cash back at over 12,000 Neo partners. While I’m sure that number is accurate, your actual cash back return will depend on which merchants you shop the most at. Neo does guarantee users a minimum of 0.5% cash back, up to $50 per month. That’s pretty a good earning rate considering no other secured card allows you to earn cash back.

Benefits and perks

Since the Neo Secured Credit card is a no fee card, it has minimal benefits. That may disappoint some people, but you’re already earning cash back, so any additional perks should be considered a bonus.

Guaranteed approval

The Neo Secured Credit card has guaranteed approval. There’s no need to worry about being declined when applying for this card. You can start building your credit score right away. When using this card, your credit history gets reported to TransUnion.

Low security deposit

Like all secured credit cards, the Neo Financial Secured card requires you to deposit security funds. This card is appealing because the minimum deposit is just $50. That’s significantly lower than many other secured cards. That said, your security deposit also acts as your credit limit, so leaving a low amount on your card will lower your purchasing power.

Smart financial tools

You can get insights into your spending habits through the Neo Financial app. This lets you track your average spending, see your purchases by category, and more. Having the ability to see all your purchases in a single place can be incredibly useful for anyone who’s looking to take control of their finances.

Optional upgrade

The Neo Secured Credit card is pretty basic, but you can upgrade to Neo Premium for $4.99 a month. Once upgraded, you’ll earn 3% cash back on all gas and grocery purchases and 0.5% cash back on all other eligible purchases. You’ll also get boosted cash back offers at Neo partners, credit score monitoring, and some insurance. 

When your Neo cash back is paid out

Any cash back earned with your Neo Secured Credit card is paid out immediately. There’s also no minimum cash back amount required to get your rewards. This is relevant since most cash back cards typically have a minimum threshold requirement before you can claim rewards. Some cards also only pay out monthly or yearly.

Neo Secured Credit Card eligibility

  • You’re a Canadian citizen or permanent resident
  • You’re at least the age of majority in the province or territory in which you reside
  • You have a Canadian ID
  • You must provide a security deposit of at least $50

To be clear, this card has no minimum income or credit score requirement. In fact, this card comes with guaranteed approval.

How the Neo Secured Credit Card compares to others

There aren’t many secured credit cards in Canada, so there are limited options for comparables. That said, here are a few cards you want to consider.

Neo Secured Credit Card vs. Capital One Guaranteed Secured Mastercard

Although the Capital One Guaranteed Secured Mastercard has an annual fee of $59, it’s often a popular choice for those looking to build their credit score. That’s because Capital One is an established brand in Canada, and their card has helped over 4 million Canadians get access to credit. Although you won’t earn any cash back with this card, you get purchase assurance, extended warranty, car rental collision/loss damage waiver insurance, and price protection.

Neo Secured Credit Card vs. Home Trust Secured Visa

The Home Trust Secured Visa has no annual fee, so it’s comparable to the Neo card, but the minimum security deposit is $500. That number is reasonable, but that’s a lot of money for some people. One advantage of the Home Trust Card is that it reports your transaction history to Equifax and TransUnion. Meanwhile, the Neo Card only reports to TransUnion. If rebuilding your credit with both agencies is a significant concern for you, the Home Trust card may be a better choice. That said, the Home Trust card offers no cash back.

Neo Secured Credit Card vs. KOHO

KOHO is not a secured credit card. It’s a prepaid card, but you can subscribe to the credit building service for $10 a month. This is an expensive option, but the card is worth mentioning because you’ll earn cash back on all your purchases, not just merchant partners. In addition, you’ll earn interest on any money deposited to your card. For credit building purposes, Neo is better. However, if you’re looking for more perks and insights into your spending, KOHO is appealing.

Final thoughts

My Neo Secured Credit card review is positive. The card is ideal for people in the following situations:

  • You want to build or rebuild your credit – Your transaction history gets reported to TransUnion.
  • You don’t want to pay an annual fee – There’s no monthly or yearly fee to worry about.
  • You want to earn rewards – This is the only secured credit card that earns you cash back rewards.

Considering this is a no fee card, it is arguably the best option for people looking to build or rebuild their credit scores. Remember that your security deposit acts as your credit limit, and you can’t use that deposit to pay your bills. If you use your card responsibly, you’ll see your credit score increase over time. Once your credit score has increased, you could switch to the Neo card, which is a traditional credit card (Available at the end of December, 2023).

About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi

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