Learn How First Premier Credit Cards Work

What First Premier Credit Cards Are and Who Issues Them

First Premier Bank, based in South Dakota, issues First Premier Credit Cards as a specific product line designed for people rebuilding their credit history or entering the credit system for the first time. Unlike major card issuers like Chase or Capital One, First Premier operates primarily through credit products targeted at subprime borrowers—those with lower credit scores, limited credit history, or past credit problems.

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The bank has been operating since 1988 and focuses on serving customers who may have difficulty getting approved for traditional credit cards. First Premier's card products include the First Premier Mastercard, which comes in both secured and unsecured versions depending on the applicant's financial situation and credit profile. A secured card requires a cash deposit that serves as collateral, while an unsecured card does not.

It's important to understand that First Premier cards are not the same as prepaid cards. With a prepaid card, you load money onto the card beforehand and spend only what you've loaded. With a First Premier credit card—whether secured or unsecured—you're borrowing money from the bank and building a credit history through your repayment activity. This distinction matters because using credit and repaying it on time is what builds credit scores.

First Premier operates as a mainstream financial institution, not a government program or benefit provider. The company makes money by charging cardholders interest, fees, and other charges. Their business model depends on issuing cards to people who might not otherwise have access to credit products, which explains why their cards often come with higher fees and interest rates compared to premium credit cards.

Practical Takeaway: Recognize that First Premier cards are designed as a credit-building tool for people with challenged credit histories, not a shortcut to traditional credit cards. Understanding the issuer's business model helps you evaluate whether their fees and terms are worth the credit-building opportunity they provide.

How Secured First Premier Cards Work

A secured First Premier Mastercard requires you to place a cash deposit with the bank. This deposit typically ranges from $300 to $2,500, depending on the specific card product and your financial situation. The deposit serves as security for the bank—if you stop paying your bill, the bank can take money from your deposit to cover what you owe. This is why secured cards are much easier to get approved for than unsecured cards, even with poor credit.

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Here's the critical part: your deposit is not the same as your credit limit. If you deposit $1,000, your credit limit might be $1,000, but it could also be different depending on First Premier's underwriting. Some secured card programs match the deposit dollar-for-dollar to your credit limit, while others may offer a different ratio. You need to review the specific terms of whichever First Premier card you're considering.

When you use the secured card, you're using borrowed money just like any other credit card. You make purchases, receive a statement, and must make monthly payments. Interest accrues on your balance if you don't pay it off in full. The deposit sits in a separate account held by the bank and doesn't earn interest (or earns minimal interest depending on the card terms). You only access the deposit if you close the account or upgrade to an unsecured card.

Many people use secured cards as a stepping stone. After demonstrating responsible payment behavior for 6-24 months, cardholders can sometimes graduate to an unsecured card with the same issuer, and their deposit gets returned. However, this is not automatic—it depends on your payment history and the bank's policies. Some First Premier customers report being invited to convert; others never receive an offer and must actively request consideration for upgrading.

The monthly payment on a secured card works identically to any credit card. You receive a statement showing your balance, and you must pay at least the minimum amount by the due date. Paying only the minimum means interest charges continue to accrue on your remaining balance. Paying the full balance means you avoid interest entirely.

Practical Takeaway: A secured First Premier card locks up your cash deposit but provides a genuine path to building credit history. Before getting one, confirm the deposit amount required, the credit limit you'll receive, and the timeline mentioned in the terms for potentially converting to an unsecured card.

Fees, Interest Rates, and the True Cost of First Premier Cards

First Premier Credit Cards carry significantly higher costs than cards issued to people with good credit. This reflects the higher risk the bank takes by issuing to subprime borrowers. Understanding these costs upfront is essential because they directly impact your wallet and your ability to build credit affordably.

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Annual percentage rates (APRs) on First Premier cards typically range from 19.99% to 24.99%, depending on the specific product and your creditworthiness. This means if you carry a $500 balance and make only minimum payments, you're paying roughly $100 per year in interest alone before reducing the principal. Compare this to premium credit cards with APRs around 12-17% for good-credit borrowers, and the difference becomes obvious.

Beyond interest, First Premier charges multiple types of fees. Annual fees range from $35 to $99 depending on the card version. Some cards charge a one-time processing fee (sometimes $25-$75) just to open the account. Secured cards may charge a deposit maintenance fee. Late payment fees typically run $25-$39 per incident. Over-limit fees apply if you exceed your credit limit. Cash advance fees and foreign transaction fees also apply on most products. These fees can add $150-$300 or more to your annual cost, depending on your usage patterns.

A concrete example: If you open a First Premier Mastercard with a $500 deposit, you might pay a $75 processing fee upfront, $99 annual fee, and carry a $200 balance at 22% APR while making minimum payments. Over one year, you'd pay approximately $44 in interest plus the annual and processing fees—totaling roughly $218 in costs beyond your actual debt repayment. This illustrates why these cards should be viewed as temporary credit-building tools, not long-term financial products.

Some First Premier products offer incentives like rewards or credit limit increases after a certain payment history, but these benefits don't offset the high costs for most users. The real value of the card lies in its ability to build credit history that eventually qualifies you for better cards from other issuers.

Practical Takeaway: Calculate your actual cost before opening a First Premier card by adding the annual fee, processing fee, and estimated interest charges based on how much you plan to carry in a balance. Only proceed if building credit history justifies the expense for your situation.

How Credit Reporting Works With First Premier Cards

The primary reason people get First Premier cards is to build or rebuild credit history. The card only helps your credit if First Premier reports your payment activity to the three major credit bureaus: Equifax, Experian, and TransUnion. Most First Premier cards do report to all three bureaus, but you should confirm this before opening an account because not all secured card products report universally.

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Here's how the reporting mechanism works: Each month after your payment due date passes, First Premier sends information to the credit bureaus about whether you paid on time, paid late, or didn't pay. They report your current balance relative to your credit limit (your utilization ratio). Over time, this monthly reporting creates a payment history that becomes the largest factor in your credit score—typically 35% of the total score.

Payment history is calculated based on whether you paid on time for each billing cycle. One late payment can damage your score by 100+ points, while six months of on-time payments can start building your score back up. This is why getting a First Premier card specifically to build credit only works if you commit to paying at least the minimum amount on time, every time. Missing even one payment negates months of positive activity.

Your credit utilization ratio—the percentage of your available credit that you're using—also affects your score. If you have a $1,000 limit and carry a $800 balance, your utilization is 80%, which hurts your score. Ideally, you keep utilization below 30%. This means if you open a First Premier card with a $500 limit, you should try to keep your balance below $150 to avoid damaging your score through high utilization. Many people use their First Premier card for small, regular purchases and pay them off quickly specifically to keep utilization low while building history.