Writer: Eric Bank
Editor: Lillian Guevara-Castro
Reviewer: Adam West
Key Takeaways
- KeyBank’s program surpassing 40,000 graduates illustrates how secured card initiatives can quickly convert thin-file and subprime clients into customers eligible for unsecured products.
- Well-structured secured programs balance risk controls with growth, creating a self-replenishing pipeline that drives portfolio expansion.
- Competitive and regulatory pressures are pushing issuers to innovate — shortening graduation timelines, adding rewards, and building in education — to strengthen loyalty and retention.
KeyBank recently announced a major milestone: Its Key Secured Credit Card® program has helped more than 40,000 cardholders graduate to unsecured cards since launching in 2019.
That figure includes more than 4,400 graduates in just the first half of 2025. Many of these clients started with no credit score, and within two years, nearly 9 out of 10 had advanced to an unsecured product.
“The Key Secured Credit Card program provides clients with the building blocks to establish or strengthen their credit profile,” said Dan Brown, Director of Consumer Product Management at KeyBank, in the press release announcing the milestone.
Close to 60% of participants moved on within a year, while the remainder followed soon after. Graduates averaged a 724 score, and those who already had a score saw an 85-point increase. The upshot for issuers is straightforward: Faster graduation cycles shorten time-to-profit and broaden the pool of customers who may qualify for mainstream credit.
For issuers like KeyBank, the value of secured cards goes beyond limiting risk — they also help build loyalty and deepen customer relationships.
Once clients demonstrate responsible use, they’re transitioned to unsecured cards with higher rewards and larger credit lines. KeyBank’s Invitation to Apply campaign makes this shift seamless, guiding graduates into products like Latitude® and Cashback® for a natural step into the broader portfolio.
Why the Structure Matters to Issuers
Secured cards are a structured entry point into credit. The deposit limits loss exposure, while bureau reporting builds a customer’s history — a low-cost way to manage risk that also supports upward mobility.
For issuers, the model reliably turns thin-file or subprime applicants into profitable customers who eventually migrate into unsecured products with higher margins.
Programs are evolving with faster graduation timelines, starter rewards, and education tools — from online resources to branch workshops — that encourage responsible repayment. These features reduce churn and deepen engagement, which illustrates that secured cards are not a dead end.
That reinforces the role of these programs as building long-term customer relationships.
Market Opportunity
Segments with thinner credit files — such as new immigrants, young adults, rural communities, veterans, and people of color — offer valuable growth opportunities. The real payoff isn’t short-term profit but long-term customer value.
By attracting these customers early with transparent pricing, clear upgrade paths, and entry-level rewards like 1% cash back, issuers can build loyalty and keep them from moving to competitors as their credit profiles improve.
The question isn’t whether to offer a secured program, but how to design one that captures tomorrow’s prime customers today. Low or no fees, transparent graduation policies, and rewards are now table stakes as fintechs and credit unions set higher standards.
Other Banks’ Results
KeyBank is not alone. Fifth Third Bank has graduated more than 48,000 customers from its secured card program since 2019. New-to-credit participants passed the program with a median 729 FICO score, while those who entered with an existing score improved from 627 to 721.
Graduates are automatically upgraded into a 1.67% cash back card with no annual fee — a simple retention strategy that grows with the customer.
Navy Federal Credit Union takes a similar approach, offering 1% cash back on its secured card and conducting early upgrade reviews, proving that secured products can deliver meaningful rewards without slowing graduation.
Why Secured Cards Matter
For issuers, secured programs are portfolio assets, not side projects. Managed well, they create a pipeline: Deposit-backed accounts convert into unsecured lines with better economics and stronger cross-sell. Graduation builds loyalty, trims acquisition costs, and often secures primary relationship status.
Competitive pressures are mounting. Credit unions and fintechs are shortening graduation timelines and adding rewards, raising customer expectations. Institutions that fall behind risk losing their most valuable future customers at the very start of their credit journey.
At the same time, regulators continue to emphasize access and fairness, reinforcing the need for transparent, inclusive secured programs.
KeyBank’s success shows how these programs can become powerful engines for long-term growth.
