Prepaid debit cards are making a dent within the check cashing business. For years check cashing shops have served that part of the monetary market that didn’t have typical bank accounts. Pay checks, authorities checks and personal checks are all cashed for a price that may range from 1.5% to 10% of the face value of the check. Typically folks paid these rates simply because there aren’t any typical banks positioned of their community.
Enter the prepaid debit card. Both Mastercard and Visa have prepaid debit programs which have significant advantages over the traditional check cashing shop. Probably the biggest advantage is not having to carry around cash. You probably have just cashed your weekly or bi-weekly paycheck, what do you do with the cash? Carry it on you? Hide it someplace at house?
With the prepaid debit card, your deposit is recorded and the card is the only thing you must make purchases at a store, on-line, or get money out of an ATM. Funding your card can be completed by direct deposit or by reloading the card at one of thousands of stores that provide the service. There is no such thing as a want to hold round more money than you need. Because the debit card is utilizing your own cash and is not a credit card, there typically is not any credit check and most individuals are approved online immediately. Because there isn’t any credit check there is no inquiry recorded on your credit report.
While carrying a debit card is safer than carrying cash, there’s a downside when it comes to liability. Unlike a credit card which limits your liability for fraudulent use or broken or undelivered merchandise to $50, the debit card has stricter requirements. The card user should report the loss of his card or suspicion that the card has been compromised within 2 days of the event to limit his liability to $50. If the loss is reported after 2 days the liability jumps to $500. If the loss will not be reported for 60 days, then there is no such thing as a protection and your account might be wiped out. The big difference right here is if you’re disputing a fraudulent credit card charge, you are not out of money. If you report a fraudulent use of your debit card, the bank might take 10 days to analyze that means you might be out that unauthorized use for over a week.
So how do these cards make money for the issuers? In case you are thinking about utilizing a debit card, make positive you caretotally read the terms and conditions and price schedule. There are various programs available on the internet they usually all have different payment schedules and features. Look for a card that does not cost you to reload in case you use direct deposit. Look for a card that will assist you to see your balance on-line or by way of telephone without a charge. For those who shop caretotally, you will definitely save money compared to the check cashing shops.
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