Unemployed Workers Getting Zinged by Debit Card Fees - 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 » Unemployed Workers Getting Zinged by Debit Card Fees

Unemployed Workers Getting Zinged by Debit Card Fees

Unemployed Workers Getting Zinged by Debit Card Fees
The content is accurate at the time of publication and is subject to change.

In the wake of the economic downturn, state unemployment agencies are trying to cut costs. States, such as Arkansas, Idaho, Nebraska, Ohio, Oregon, California, New Jersey and, most recently, Wyoming, have begun to use debit cards to dole out the unemployment money that those without jobs are collecting. In total, about 30 states offer the unemployed the option to collect their money on a prepaid debit card. Without having to cut and mail checks, states save some significant green. The problem is that debit cards often cost the unemployed more money—money they already don’t have enough of without a job.

Transaction Fees

While it is convenient for the unemployed to have their benefit money loaded onto prepaid debit cards that they can use to make purchases and pay bills, the fees associated with using debit cards is zinging some of the cardholders in a big way. A transaction fee is one of the pitfalls for unemployment debit cardholders. The transaction fee is debited from the balance on the card each time the debit card user withdraws money from an ATM that is not owned by the card issuer. The average transaction fee costs $1.50.

Other Fees

The fees are not universal for all of the debit cards, so unemployed individuals need to read and understand the terms and conditions of using their particular cards. While transaction fees occur when making cash withdrawals, debit cardholders may also get hit when making purchases with the card. Some cards assess a fee each time a balance check occurs or for reaching out to the customer service department of the bank that issues the card. Overdraft fees are also possible on the cards. The bottom line is that these prepaid debit cards work in a similar fashion to traditional bank debit cards, which means that fees may apply.

The Best and the Worst

According to a study done by The National Consumer Law Center, some of the state unemployment debit card programs are better than others. Unemployment debits cards issued by U.S. Bank seem to be the worst for users. U.S. Bank issues the debit cards for the states of Arkansas, Idaho, Nebraska, Ohio and Oregon. These cards carry the highest overdraft fees, which range from $20 to $30 a pop. The same survey touts California and New Jersey as having the best debit cards for the unemployed. The issuer of these cards is Bank of America.

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:

Synchrony and JCPenney Are Still Partners

Posted: October 16, 2018

Synchrony and JCPenney have inked a multi-year deal extending their strategic partnership, which includes their private label credit card program and the JCPenney MasterCard. This extension means that the two will continue to work together ... Continue reading
American Express Makes Referring a Friend to Their Credit Cards More Rewarding

Posted: October 15, 2018

Getting a hefty bonus for referring a friend to American Express can be a great way for cardholders to bank points. The good news is that it just got easier, and perhaps more lucrative due to an upgrade in the American Express refer a ... Continue reading
Capital One’s Credit Wise Adds New Security Features

Posted: October 12, 2018

With data breaches becoming more commonplace, consumers are looking for ways to protect themselves, and now CreditWise, a free service from Capital One, has launched three new features to help them keep identify theft and fraud at bay. The ... 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, or wholesale clubs 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!