Does paying off a secured credit card in full each month not allow me to build a credit history?

I'm asking because reading about regular credit cards indicates that paying in full helps build a good score — but I was told at the bank that I should make payments of more than the minimum, but less than full if I want to build credit.

I know this is an oft-asked questions, but I haven't found much on it regarding credit cards, and nothing with regards to secured credit cards.

  • +1. This is an excellent question -- I'm curious about it as well. Jan 20, 2014 at 16:05
  • 11
    So the bank told you a strategy that ensures a stream of interest charges for them?
    – JohnFx
    Jan 20, 2014 at 17:18
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    @ChrisW.Rea, thanks for the edit, it's much clearer now. Jan 20, 2014 at 18:18

1 Answer 1


A secured credit card is the same as a regular credit card from a credit scoring perspective. The secured nature of the card is only known by the issuing bank.

With that known, the rest of the question becomes a credit scoring question regarding credit cards. It is always better for you, the borrower, to pay off the card in full every month. This will result in you paying the lowest amount of interest (if done faithfully you'll pay none). The bank would prefer you to pay anything less than the full amount so they can earn interest. As such, their advice to you was in this vein.

Credit scoring cares mostly about utilization and payment history when it comes to credit cards. Utilization is not historically tracked, but payment history is. Utilization measures how much of a card's credit limit you're using at any given time. It is calculated using the "statement balance" on your statement (meaning it does not distinguish between paying in full or carrying a balance).

Ensure you pay the bill on time always and pull your utilization below 10% when seeking new credit.

  • 3
    +1 you nailed it. One can build a good credit score without paying interest to do so. (Hope to see you here more often, Frazell) Jan 20, 2014 at 17:07

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