Can merchants tell the difference between a secured or unsecured credit card?

Question

When I'm new in a country, the only credit card I can get might be a secured credit card. I would need a credit card because I want to be able to rent cars. Does it make any difference whatsoever whether this credit card is secured or regular?

A secured credit card is arguably not really a credit card as I'm not borrowing any money, so I wonder if car rental companies can tell and may be reluctant to rent to customers using secured credit cards, just as they are unwilling to accept debit cards. Can there possibly be a difference, directly or indirectly?

See also: Can merchants tell the difference between a credit card and embossed debit card?

NB: I am not talking about prepaid cards. I am talking about secured credit cards.

Answer 1

They should not be able to tell the difference between a regular card and a secured card. The issue for a vendor is can they put a lock on the account equal to the transaction you are about to do. For a rental car company they don't have an exact idea of what your charges will be: it is based on many options some of which you don't decide until the day you return the car.

Because a secured card generally is on the small end (max measured in hundreds or at most $1,000) they might not be able to put a lock of sufficient size on the card.

Answer 2

This depends on if you're talking Secured credit card, or prepaid debit card.

There is no separate category for secured credit cards in the IIN list; however, it is possible some of them are classified as debit cards (despite not being debit cards). You may want to check with the issuer to verify this (and you can check the IIN, or the first 6 digits of the card number, in the list I link to above to verify). However, prepaid debit cards are debit cards, and are less likely to be accepted for travel, rental car, hotel, etc. types of charges (where a hold, similar to a deposit, is charged to the account).

This is one of the major differences between a prepaid card, such as the kind you top up at the grocer, and a secured credit card, where you deposit some money but separately pay back the amount you charge on the card (as a regular card). Secured cards are classified as credit cards, while prepaid cards are debit cards.

As mhoran notes, it's possible your credit limit could be too low to allow a hotel, airline, or rental agency to allow a transaction, but otherwise it should be fine.