If you’ve ever needed a credit card to rent a car or hotel room, you understand the importance of having one. Secured credit cards may be the only option for those with poor credit.

By giving money to a credit card issuer to “hold,” borrowers with poor credit are ensuring that their lenders are paid back if the borrowers don’t make their payments.

Indeed, secured credit cards can be used by borrowers to establish a credit history.

For example, consider the case of a young woman who graduated from college with no student loan debt but also never had a credit card or any other loans, and therefore had no credit history. She may have trouble leasing apartments that require a credit check as part of the approval process, since she has no credit history for landlords to review.