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Any evaluation, advice, opinion or guidance provided by us or editorialized by us within this website such as bank reviews, product reviews or editorial content is in no way affected by or based upon compensation from our advertisers. Prepaid debit cards have become more popular than they used to be, and they can serve as productive tools for managing money.

So, how do these prepaid cards work, and should you get one?

How Do Prepaid Debit Cards Work? - NerdWallet

A prepaid debit card is an alternative banking card that lets you pay for transactions as you would with a debit card. You can generally use a prepaid card wherever its payment network, such as Visa or Mastercard, is accepted. The cards usually offer several ways to do this. With some cards, you can also link to a checking account for online transfers. About 9 million U.

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For those with bank accounts, these cards can be tools to budget without worrying about overdrawing a checking account. They also can be useful for people on a fixed income, teenagers who get allowances and relatives visiting from other countries.

But prepaid debit cards have major limitations compared with checking accounts and credit cards.

Although they typically have online services, many prepaid cards lack standard bank services, such as a way to withdraw or reload cash for free. What new prepaid debit card rules mean for you. You can usually add money to a card in multiple ways, such as setting up direct deposits, loading cash at participating retailers and depositing checks at ATMs. Some cards also let you make online transfers or mobile check deposits from a smartphone. Impots plus value stock options prepaid cards have access to free nationwide ATM networks, such as MoneyPass and Allpoint, or to branded bank global forex institute facebook for cards issued by banks.

You might have to pay for activating a card, making deposits and using out-of-network ATMs. Some cards sanofi aventis stock price paris exchange a fee for every purchase and ATM transaction. Some cards restrict how much you can do prepaid debit cards make money, reload or spend during a certain period, such as a day or month.

Some cards offer purchase protections, but it can be difficult to dispute unauthorized transactions or correct errors. One safeguard many cards have is federal deposit insurance, meaning your money is covered if an issuer becomes bankrupt.

Prepaid cards have expiration dates. If that happens to you, reach out to the prepaid company to see if it can be resolved. If not, you can submit a complaint on the CFPB website. Some prepaid cards offer check writing, online bill pay and multiple copies of a card for family members.

A rare few even offer rewards such as cash back on purchases, similar to what rewards credit cards do.

Credit Card Help: 9 things you need to know about prepaid cards

The basics of debit cards. Several prepaid cards have been affected by technological outages that lasted days or weeks. The Walmart MoneyCard experienced an outage in Netspend recently agreed to settle with a federal regulator over claims that customers were blocked from accessing their accounts.

Credit Card Help: 9 things you need to know about prepaid cards

If you want a checking account without monthly fees, consider our list of best free checking accounts. There are also second chance checking accounts for people with bad credit or banking histories. Whether used as a budgeting tool or as an alternative way to bank, prepaid debit cards can help you store and spend money productively.

Compare options to find the card with the lowest fees and the best features. Spencer Tierney is a staff writer at NerdWallet, a personal finance website. NerdWallet strives to keep its information accurate and up to date. All financial products, shopping products and services are presented without warranty. Pre-qualified offers are not binding. So how do we make money?

We receive compensation from our partners when someone applies or gets approved for a financial product through our site. But, the results of our tools like our credit card comparison tool and editorial reviews are based on quantitative and qualitative assessments of product features — nothing else. Log in Sign up. Ready to choose a prepaid debit card? Bluebird Chase Liquid PayPal.

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