PrePaid Debit Cards

I recently let my current bank talk me into trying their prepaid debit card. It was free since I bank there, and it remains free for anyone who deposits at least $500 into the account a month. Otherwise, it has a monthly fee of $4.

The reason the branch manager brought it up, is because this is one of the reasons I bank with the online bank – backup. Should anything happen to my debit card, I won’t be left without electronic funds while I wait for a replacement. He said I could use the prepaid debit card instead. I’m not crazy about them, but he’s a good salesman, not good enough to get me to apply for a credit card, but good enough to talk me into something else I didn’t want or need.

He told me that I could transfer money to or FROM the card anytime I wanted. I caps-smack “from” because that was not true. It’s not a big deal, but it was annoying. Here’s what happened:

I was thinking that I would move my vacation money to the prepaid card instead of my checking account, and then I would just use the prepaid card on vacation instead of cash. To open the account, I had to put money on the card. So I was thinking, I would just transfer that money back into my checking, and at the end of vacation, if I was under budget again (and I probably will be), I would do the same with whatever I have left.

Unfortunately, I transferred money to the card before I tried transferring money from the card. It was too late. My money was stuck. I was not happy. I called the bank and was told that it wasn’t possible to transfer money off of the card. Once you put money on the card, the only way to get it off is to spend it, withdraw it from the ATM, or go into the branch and have them do a “cash advance” on it. Like everything else that has to do with money, I learn this the hard way.

Lucky for me, this isn’t grounds for changing banks. Though funny story: when I went into the bank to sit down with the branch manager guy for an “account review” and “meet and greet” (because he recently transferred from another branch), I ran into this lady (who incidentally also shops where I work), and she was having a heated conversation with said branch manager and one of the tellers. As she’s leaving, she turns to me and goes, “RUN! Leave this place! Run as fast as you can!”

He said she was closing her business account and there was a fee associated with it, and she wasn’t happy. Can’t make everyone happy. Outside of the prepaid card, I’ve been pretty happy though. And it’s much easier to talk to a live person with them than it was at Bank of America.

Side Note: I did recently get a call from someone I banked with a few years ago who wanted me to stop in and see what they could do to get my business back. Second time they called me. Given how often I have changed banks, if I was interested, I would be there. But I thought that was interesting.

So, overall, I find prepaid cards strange. The one at my bank isn’t so bad from the looks of it, but other ones charge you fee per transaction. They charge you a fee to load it. Some charge an unavoidable monthly fee. And I’m wondering what the point of it is.

The branch manager says he uses his for extra protection when shopping online. I’m not quite that paranoid, but I can see how that would be appealing – I can load the card up right quick with an online transfer and then buy something with exactly that amount. I can see how it might be a good way to help people stay on budget or a good way to give an allowance or vacation spending money or something to a kid.

But do people actually use these things in lieu of a bank account? Because that could get expensive. Not to mention always having to go somewhere and load the card. Sounds like a hassle. Like maybe It would be easier to just use a bank account, but I guess it depends on why people have one. I don’t know enough about them to say they’re pointless, but I certainly don’t see the benefit of me having one. I feel like it’s just going to take up space in my wallet. I don’t mind. I obviously love plastic. But it’s not serving a purpose right now.

 

Hi ^_^