Best Prepaid Debit Cards for January 2024     – CNET

Best Prepaid Debit Cards for January 2024 – CNET

6% of US adults are “unbanked,” meaning they don’t have a checking or a savings account, according to a 2022 Federal Reserve report. If you don’t have access to a conventional banking service and need a payment alternative, a prepaid debit card could be an option for you. 

“A prepaid debit card is a gateway solution for unbanked consumers when there’s little to no access to safe or low-cost banking alternatives,” said Renee Jones, vice president of product management at Georgia’s Own Credit Union.

Unlike credit cards, prepaid debit cards don’t require a credit check and won’t let you spend beyond the amount you load onto the card. Most prepaid debit cards also allow you to withdraw cash from ATMs — just watch out for fees. Here are some of the best to consider.

Serve American Express Card

Serve American Express Card

Best overall prepaid debit card

Monthly fee: $6.95
ATM fee: Free at MoneyPass ATMs; $2.50 elsewhere
Reload fee: $0
Cash reload limits: $20 to $500
Other fees: Card purchase is $1.50 at retail stores or free if ordered online
Reload locations: Over 45,000 across the US

The American Express Serve® card is a reloadable prepaid debit card that works similarly to a traditional debit card. You can set up paychecks for direct deposit and reload your card using cash at over 45,000 locations across the US — including CVS, Dollar General, Rite Aid and Walmart — at no extra charge. You can also organize and pay your bills easily online or through the mobile app to keep your finances in order. You can register your card to protect your funds against fraudulent charges. There’s a $6.95 monthly fee ($0 when you direct deposit at least $500).

Greenlight Debit Card

Greenlight Debit Card

Best prepaid debit card for kids

Monthly fee: $4.99 to $14.98 (up to five kids)
ATM fee: Free
Reload fee: N/A
Cash reload limits: N/A
Other fees: Custom-design card fee for $9.99, card replacement $3.50
Reload locations: N/A

Entrusting your kids with their own debit cards can help teach them about budgeting and financial responsibility. The Greenlight debit card is available for kids of all ages and provides tutorials about money management. Parents can set up a chore list through the app and instantly send money over when they’re completed. Funds transfer instantly, in case your kids are out with friends and need money in a pinch. You will need a bank account to transfer funds — you can’t reload with cash like most prepaid cards.

If you’d like your kids to get some practical knowledge about investing, the $9.98 and $14.98 monthly plans add stock trading. Don’t worry — you can approve the trades first. But it’s pretty cool to get notifications that your child wants to buy Starbucks shares instead of a latte.

PayPal Prepaid Mastercard

PayPal Prepaid Mastercard

Best prepaid debit card for reload options

Monthly fee: $4.95
ATM fee: Balance inquiries are $0.50, withdrawals are $2.50 each
Reload fee: Up to $3.95
Cash reload limits: Up to $500
Other fees: Card is free if you order online or up to $4.95 at participating retailers
Reload locations: Over 130,000
Welcome bonus: Refer a friend and you’ll each receive $20
Welcome bonus value: $40

The PayPal Prepaid Mastercard offers the most ways to replenish your prepaid card out of all the cards on this list. You can accept direct deposits, reload at more than 130,000 NetSpend Reload Network locations nationwide or make PayPal transfers for free. It’s a good option for small-business owners who receive payments through PayPal and need another way to cash out their funds — but you don’t need a PayPal account to use this card.

Movo Virtual Prepaid Visa Card

Movo Virtual Prepaid Visa Card

Best virtual prepaid debit card

Monthly fee: $0
ATM fee: $2
Reload fee: None
Cash reload limits: Two deposits per day (up to $4,000) and no more than four deposits per rolling 30-day period (up to $8,000)
Other fees: Order a physical Cash Card for $2.95
Reload locations: 3.5 million in-network ATMs; participating retailers

Movo offers a virtual prepaid Visa that eliminates the need for a plastic card. You’ll receive a Mastercard number you can add to your digital wallet to make payments and deposits through the mobile app. Temporary virtual card numbers can be generated when you need extra privacy, such as when signing up for a free trial that converts into a paid subscription. Movo also lets you convert and transfer cryptocurrency as cash anytime. If you need to deposit cash, you can visit one of Movo’s 3.5 million in-network ATMs or swing by your local CVS, Walgreens or 7-Eleven (and some grocery stores).

Bluebird by American Express

Bluebird by American Express

Best low-fee prepaid debit card

Monthly fee: $0
ATM fee: Free in-network, $2.50 elsewhere
Reload fee: Free at Walmart, $3.95 at participating retailers
Cash reload limits: $20 to $2,500 once your card is activated; $1 to $500 for temporary cards
Other fees: No account inactivity or card replacement fees
Reload locations: Over 30,000

The Bluebird by American Express prepaid debit card has the lowest fees of all the cards on this list. You can replenish your card at a Walmart location and stick with the MoneyPass ATM network — featuring over 37,000 locations — to avoid many of the fees other prepaid cards typically charge. American Express also offers direct deposits up to two days faster than scheduled with free Early Direct Deposit. And once you’ve verified your email address, you can pay bills and set up recurring payments.

Serve American Express Prepaid Debit Account

Serve American Express Prepaid Debit Account

Best prepaid debit card for rewards

Monthly fee: $7.95
ATM fee: Free at MoneyPass ATMs or $2.50 elsewhere
Reload fee: $3.95
Cash reload limits: $20 – $500
Other fees: Card purchase is $1.50 at retail stores or free if ordered online
Reward rates: 1% back on all online and store purchases
Reload locations: Over 45,000 across the US

Not to be confused with the free reload card, the Serve American Express Prepaid Debit Account helps you earn cash back for purchases you would be making anyway — a true rarity for a prepaid card. Serve rewards you with 1% back on all your purchases, which hit your account as soon as the transaction settles. You can’t redeem the rewards as actual cash during ATM withdrawals, but you can apply your cash-back balance to your next in-store or online purchase.

What is a prepaid debit card and how does it work?

Prepaid debit cards are often associated with major payment networks, such as Visa, Mastercard or American Express, and can be used anywhere standard credit cards are accepted. Prepaid cards aren’t linked to a checking account or credit line, so no credit check is required. 

These cards are straightforward, and there’s no risk of going into debt: Funds you add are available right away, and the card will be declined if you try to spend more than you have. 

You can add funds to a card online or at many retail locations like grocery stores and gas stations — though you’ll likely pay a fee. However, according to Jones, unlike credit cards where you’ll accrue interest charges if you carry a balance, prepaid debit cards can prevent you from overspending. 

“Prepaid debit cards are a safe and convenient way to access cash at [an] ATM and transact on everyday items such as groceries, gas, transportation and bill payments for utilities, internet and mobile phones,” Jones said.

Just be aware it’s not uncommon to see a hold placed on your pre-paid debit card at gas stations, hotels and some restaurants. This could happen to your credit cards, too.

Most prepaid cards offer some of the features you’d get with a checking account — you can pay bills, receive direct deposits, transfer money, withdraw funds at ATMs and deposit cash. But in contrast to a checking account, prepaid cards often come with several fees, such as reload fees, monthly fees, ATM withdrawal fees, transaction fees and others.

How to get the most out of your prepaid debit card

By following these tips, you can maximize the financial benefits when selecting and using a prepaid debit card.

  • Compare monthly fees with the card’s benefits to get the best card for your financial needs and spending habits.
  • Look for a card that has in-network ATMs convenient to you to avoid ATM fees.
  • Avoid hitting reloading limits and paying reloading fees by looking for a card that offers convenient reloading locations. If possible, set up your paychecks for direct deposit. 
  • Use your card issuer’s website or mobile app to pay your bills and manage your finances.
  • Register your card to protect your funds against fraudulent charges.

Eligibility for prepaid debit cards

While prepaid debit cards aren’t credit products, they do have eligibility requirements. You’ll need to verify personal information to activate your card, including your name, Social Security number, address, date of birth and phone number.

In most cases, you’ll need to be at least 18 to use these cards. If you plan to let your child use it, you’ll need to add them to the account as an authorized user.

Pros and cons of prepaid debit cards

Cons

  • Prepaid debit cards won’t grow your credit score

  • Various fees

  • Not as convenient as a checking account

  • Hard to use for travel — hotels and rental car agencies may place holds on your card.

  • Some feature poor ATM access

Who should get a prepaid debit card?

If you don’t have access to a traditional banking service or you need a convenient way to make or receive payments, a prepaid debit card can provide some of the benefits of a credit card or checking account without a credit check or more involved application process. You can create a budget, manage your spending, use direct deposit, have a place to hold your funds and withdraw money from an ATM or bank teller, among other things.

“While underbanked consumers benefit the most, employers can use prepaid debit cards for employees who don’t have a checking account,” said Jones. “It’s also a great solution for parents to use for children, as it sets clear parameters and has some built-in ‘guardrails’ to limit overspending.”

How to choose the best prepaid debit card

Before committing to a prepaid debit card, keep an eye on potential fees and compare how easy it is to add funds and access your account online.

Here are some common factors to consider when choosing the right prepaid debit card:

Fees

Many prepaid debit cards include monthly fees, reload fees, ATM withdrawal fees and sometimes balance inquiry fees. The types and amounts of fees will vary depending on the card. There are exceptions, but you should check the card terms to see which fees apply and if you can avoid any of them. 

Benefits

If you don’t have access to a bank account or credit card, a prepaid debit card can help you manage your spending and build healthy financial habits. With a prepaid card, you can sign up for recurring monthly bill payments and direct deposit. And you can’t spend what you don’t have, unlike with credit cards. 

Ease of use

If the prepaid debit card you’re interested in offers a companion app, check to see which tools it has. The most useful will provide direct deposit options and ways to pay your bills and monitor your spending.

Check to see if there are ATMs in your card network nearby where you can load cash onto your card. If you have to go out of your way to get the most from your card, it’s likely not the best option.

Alternatives to prepaid debit cards

If a prepaid debit card isn’t a good fit for your financial situation, there are other options. 

  • Debit cards linked to a checking account. You don’t need to go to a brick-and-mortar bank to get a debit card linked to a checking account – you can now open and manage a bank account via a website or mobile app. The best online checking accounts can earn interest, let you earn welcome bonuses and offer tools to help you manage your money. These debit cards are linked to a bank account, rather than a prepaid amount. Make sure you understand the rules, limits and fees associated with the account and debit transactions before signing up.   
  • Credit cards. The best credit cards allow you to earn rewards, cash back and welcome bonuses. However, with a credit card, you’re using a line of credit instead of a pre-set amount, like a prepaid debit card. Although it may give you more spending power, it can also lead to overspending and high-interest debt. You can use credit cards to get cash advances, but you should avoid doing this since you’ll be stuck paying steep fees and interest rates are much higher than the regular APR on your credit card. Credit cards also require a hard credit inquiry.
  • Checking cashing services and money orders. If you don’t have a bank and need to cash a paper check, there are options for cashing a check. If you need to send money, you can use a money order. Both may charge fees per transaction, which can add up, and neither offer additional services, like automated bill payments, like the best prepaid debit cards do.

How to get a prepaid debit card

While prepaid debit cards aren’t credit products, they do have eligibility requirements. You’ll need to verify personal information to activate your card, including your name, Social Security number, address, date of birth and phone number. In most cases, you’ll need to be at least 18 years old to use these cards. If you plan to let your child use it, you’ll need to add them to the account as an authorized user.

The bottom line

A prepaid debit card can help fill the void in your wallet if you don’t have a traditional debit card linked to a checking account or a credit card. Prepaid cards can also come in handy if you’re a parent who wants to teach your child about financial responsibility. Though prepaid debit cards offer an alternative way to spend and deposit cash, keep an eye on fees to find the best card for your financial needs.

FAQs

We chose Bluebird by American Express as the best low-fee prepaid card. It offers free in-network ATM withdrawals and has no monthly, replacement nor inactivity fees. It’s also free to load funds onto the card at Walmart.

A traditional debit card is linked to a bank account, so any purchases you make using your debit card will be withdrawn from your bank account. A prepaid debit card is not linked to a bank account, so you can spend only as much as the available balance. If the balance runs low, you’ll need to reload the card by adding cash at a participating retailer or transferring money to the card, if it’s permitted.

Prepaid debit cards come with various fees that add to the cost. While many companies allow you to order a free card online, you can also purchase a card at a local retailer for anywhere between $1 and $6. Besides the cost of buying a card, most cards have a monthly fee that varies between $4 and $10 per month. Other fees include reload charges, which can cost as much as $6 per transaction and ATM withdrawals of $2.50 on average.

There typically isn’t a fee to cancel a prepaid debit card, but if you still have money on the card, the issuer may charge you to issue a check for the remaining balance. To avoid this, you can either pay down your balance or withdraw the remaining amount before closing the account. Call your issuer to find out what its specific cancellation policy entails. 

Cards researched

  • Serve American Express Prepaid Debit Account
  • Movo Virtual Prepaid Visa Card
  • Bluebird by American Express
  • PayPal Prepaid Mastercard
  • Greenlight Debit Card
  • Serve American Express Prepaid Debit Account
  • Walmart MoneyCard
  • Starbucks Rewards Visa Prepaid Card From Chase
  • MyVanilla Prepaid Visa Card
  • Brink’s Prepaid Mastercard
  • Western Union Netspend Mastercard® Prepaid Card
  • Control Prepaid Mastercard
  • AAA MemberPay Visa Prepaid Card
  • CUMONEY Visa Everyday Spend Prepaid Card
  • Cashpass Visa Prepaid Card
  • Commerce Bank mySpending Card
  • Netspend Prepaid Mastercard
  • Netspend Visa Prepaid Card
  • smiONE Visa Prepaid Card
  • The Mango Prepaid Mastercard
  • BusyKid Visa Prepaid Spend Debit Card
  • ACE Elite Visa Prepaid Debit Card
  • FamZoo Prepaid Mastercard
  • PNC SmartAccess Prepaid Visa Card
  • Green Dot Reloadable Prepaid Visa Card

The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.

The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.

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Cynthia Paez Bowman

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