Reloadable prepaid cards and the fees you pay - Other News

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Reloadable prepaid cards and the fees you pay

Reloadable prepaid cards and the fees you pay

Reloadable prepaid cards and the fees you pay
The content is accurate at the time of publication and is subject to change.

Consumers have made a conscious decision to cut down on using the credit card, and have opted for reloadable prepaid debit cards instead. These reloadable prepaid debit cards have gained prominence in the financial service industry during the recent times, and it is one of the fastest growing segments. These cards are expected to grow to four times their volume, and expected to go beyond $440 billion by 2017 as per the volumes project by the independent research that has been commissioned by MasterCard. Almost one-third of the customers hold some sort of prepaid card as per the 2009 survey conducted by the Federal Reserve Bank, Boston.


This product has been embraced even by the Federal Government. The Treasury has announced last week that it would provide prepaid debit cards to 600,000 taxpayers in the low-income group that they could use to get their tax refunds deposited directly.


However, there have been concerns by the consumers as well as lawmakers as these prepaid cards do not have adequate protections that come with traditional banking as well as credit union accounts. These prepaid cards also have a number of fees that literally eat into the customer’s balance.


These concerns have resulted in calls for better protection on prepaid cards. Last year the Federal Reserve Governor, Elizabeth Duke, had in her speech mentioned that financial regulators need to monitor these prepaid cards, and see if the customers were adequately protected.


Issuers of prepaid cards have stated that these are fewer expensive cards, and are pretty safe compared to check-cashing stores, pawn shops, or other businesses that are used by over 17 million Americans, who have no bank accounts.


The good news, however, is that the cost of prepaid cards has come down due to the stiff competition, as per Tim Murphy, MasterCard.


Wal-Mart had reduced its activation fee in 2009 on its MoneyCard from $8.94 to $3. The reloading and maintenance fees were also driven down to $3 each. Wal-Mart’s MoneyCard seemed reasonable when compared to the basic checking account or the check-cashing store, states Murphy.


Apart from the activation fees, and the monthly charges, prepaid cards also charge customers on other services as well, such as ATM withdrawals, balance enquiries, monthly statements on paper, and even calls made to the customer service personnel. Even closing the account attracts an additional fee. These cards are a good option if they are managed properly.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

Getting Quadruple Points with the New Business Gold Card by American Express

Posted: November 12, 2018

American Express is rolling out a new credit card for small businesses, offering quadruple reward points on the two categories in which they spend the most during the month. There are six categories they can earn these enhanced rewards in, ... Continue reading
Now Cardholders can use Ultimate Rewards for Apple Products

Posted: November 9, 2018

Chase credit card holders can now use their rewards to buy Apple products via the new Apple Ultimate Rewards Store. When shopping in the new store people with a Chase Sapphire, Freedom and Ink credit card can use their reward points to pay ... Continue reading
Contactless Credit Cards by Chase

Posted: November 8, 2018

Chase Cardholders will soon be able to make payments without swiping or dipping because Chase is going contactless. The new cards will have contactless technology built directly into the card. This way when they are at a contactless ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn 2% cash back on purchases: 1% when you buy plus 1% as you pay
For Excellent, Good Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!