Has Anyone Successfully Upgraded from a NEO Secured Card?

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Has Anyone Successfully Upgraded from a NEO Secured Card?

After my previous topic, “Has Anyone Else Received Unique Offers from NEO?”, I wanted to share another experience for discussion.

More than a year ago, when my sister turned 18, I invited her to NEO to help her begin building credit early. The goal was for her to establish a good credit history before she actually needed it for things such as financing, renting, or applying for better credit products.

NEO approved her for a secured credit card. The terms mentioned that, with responsible use, she might eventually receive an offer for a higher credit limit or an upgrade to a regular unsecured credit card.

She has now used the card responsibly for more than a year. She pays every statement balance in full and on time, and she generally keeps her utilization below 30%.

Despite that, she still has not received any offer to upgrade to an unsecured card.

The NEO card did help her build credit. After approximately 8 months, she was approved for a regular CIBC credit card with what I consider a decent credit limit for an 18-year-old who was just starting to build credit.

Her spending on the NEO card is not especially high because many of her expenses are still covered by family members. However, she has demonstrated responsible credit use, established a payment history, and has already been approved for an unsecured card by another bank.

Meanwhile, NEO continues charging her a $5 monthly fee for the secured card without offering an upgrade.

The difficult part is that this was her first credit card, so closing it may not be ideal. A large portion of her current credit history and average account age is connected to this card. It feels like a loop: keep paying the monthly fee to preserve the account history, or close the card and lose her oldest account.

Has anyone been in a similar situation with a NEO secured card?

How long did it take before you received an upgrade offer? Did contacting NEO help, or is the upgrade completely automated? Would it make more sense to keep paying the monthly fee for now, or close the card since she already has an unsecured credit card elsewhere?

I would appreciate hearing from anyone who has gone through the same process.

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I understand how frustrating it can be to be a responsible card user and feel unseen.

I was offered an unsecured card before my secured card was “not secure anymore”. So I have two credit products with Neo right now. I was going to “upgrade” my card myself because there is a way to do that in Neo. It may be called transferring? Don’t quote me on that. I had my secure card first and was offered an unsecured world elite card about 3 years later

Anyways. I applied for a credit limit increase on my unsecured card and when I was denied I was offered an increase on the secured card. Now I also have a capital one card. And my experience with capital one when they offered my an increase it stayed as secured. Until I received a letter in the mail with a cheque returning my security deposit and giving me back my deposit of $500 and they let me know the date my secured card would transition into an unsecured card. And they congratulated me.

I still have a secured card with Neo. I do not think they have this process or feature down yet. Other than reapplying and hitting your credit to upgrade or transfer your existing account to a new type of card. Even when I did the steps before hitting submit, it showed me that even with upgrading my card to a new type my credit limit would stay the same and would require me to put down $500 security deposit and the rest would be credit.

That’s my understanding and experience. I wish your sister all the best and hopefully they see she is responsible and receives some kind of appreciation in upgrading or getting an increase at least! Or an offer on an unsecured one like I did.

Take Care!

Nicole

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I would also suggest to keep the credit card regardless as it is her oldest established credit on her file from the sounds of it.

closing the account will hurt her credit more than it would help.

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I totally understand—I was starting to think it wasn’t going to happen either, but it finally did.

I had to fully switch everything over and have my direct deposit going into my Neo account before I received the automatic offer. It takes a bit of time to build that history but it made a big difference . From what I’ve heard, they’re working on updates to make that process much faster.

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The good news is that she doesn’t need to close her secured card to apply for a standard Neo card, she can hold both at the same time. She can apply for a standard Neo Mastercard at any time through the app. There’s no need to wait for an offer. The application does involve a standard credit check, and approval isn’t guaranteed, but her credit history sounds like a strong foundation. If she’d like to apply, I can point her to the right place in the app to get started.
Here’s how to request a credit limit increase in the Neo app:

  1. Open the Neo app and select your Credit account.
  2. Tap the gear icon in the top right corner.
  3. Select Manage credit limit.
  4. Review the information, then tap Request increase.
  5. Allow 1–2 weeks for a review, you’ll receive a follow-up by email.
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If the cashback rewards don’t pay for the monthly fee, close it. It might cost a few points on her credit score but unless she plans to apply for a major loan in the next 2-6 months, she should just close it now and get it over with.

The closed account will still appear in her credit report for many years to come so closing it doesn’t affect the length of credit history.

Closing an account does affect the average credit age but that only counts for 15% of one’s score and there’s no good ways around it. The longer an account is open, the larger the impact of closing it will be. Closing old accounts hurts average age and so does opening new ones but then what’s the point of having an excellent credit score if you can’t use?

Closing a credit account will also affect her credit utilization ratio which could also impact her score. But unless their old card had a much larger limit than their new one, the effect should be minimal.