Amazon this week unveiled a new secured credit card with Synchrony Bank, aimed at customers with bad or no credit history.

The card – called the Amazon Prime Store Card Credit Builder – requires a refundable security deposit, has no annual fee and offers Prime members 5% back on Amazon.com purchases. Consumer must make a deposit from $100 to $1,000, which determines their credit limit.

The card also features installment and special financing options on certain purchases.

It's also the first of its kind, said Ted Rossman, an industry analyst at CreditCards.com.

“Secured cards have long been a good way for people to build or rebuild credit, and a lot of banks offer them," he said. "But I've never seen a retailer offering one."

Is Amazon's card a good choice?

Managing a secured card is traditionally a good low-risk way to build positive credit history for those with blemished or no credit, said Matt Schulz, chief industry analyst at CompareCards.

In the U.S., 53 million people have no credit history and another 79 million have subprime credit, according to data analytics company FICO.

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“Secured cards are basically meant to be training wheels cards that people use when they're just getting started in order to help them build credit,” Schulz said.

Amazon’s new credit card also has some benefits that many secured cards don’t provide, such as a $10 Amazon gift card as a signup bonus, he said. But the credit card can only be used for Amazon purchases, Schulz added.

How does it help my credit?

Synchrony, the issuing bank behind the card, will report your payment history to the three national credit bureaus: TransUnion, Equifax and Experian. As a cardholder, you also have access to free credit score monitoring and credit advice.

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“The program puts credit in the hands of people in a responsible way while giving customers access to tangible benefits such as tools to improve credit,” Angie Hu, a spokesperson for Synchrony told USA TODAY.

You could be upgraded to an unsecured card if you meet certain criteria and make payments on time for seven straight months, according to Amazon.

“If you are somebody who keeps your balances low, pays your bills on time every time, then it is possible that you could graduate to a new card pretty quickly,” Schulz said.

Drawbacks of the Amazon card

While Amazon's new card overall is a good option for consumers, the card still comes with a relatively high APR of 28.24%, Rossman said. The average median APR for retail cards is 25.64%, according to a CreditCards.com survey.

“Store cards typically charge higher rates in large part because they're easier to get,” Rossman said.

Both analysts said consumers need to be especially wary of the special financing with deferred interest on purchases that Amazon promotes. If you don't pay off the purchase before the promotional, no-interest period ends, you will owe back interest since the original purchase.

“If you buy something and you don't pay it off within that six months or 12 or 24 months, then you will likely get a bill for any interest that would have accrued on that account since the purchase date,” Schulz said.

Follow USA TODAY reporter Frances Yue on Twitter @FrancesYue_