Prepaid Debit Cards
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 did not have typical bank accounts. Pay checks, government checks and personal checks are all cashed for a payment that may range from 1.5% to 10% of the face value of the check. Typically individuals paid these rates merely because there are not any typical banks located of their community.
Enter the prepaid debit card. Both Mastercard and Visa have prepaid debit programs that have significant advantages over the traditional check cashing shop. Probably the biggest advantage is just not having to carry around cash. When you've got just cashed your weekly or bi-weekly paycheck, what do you do with the money? Carry it on you? Hide it someplace at residence?
With the prepaid debit card, your deposit is recorded and the card is the only thing it's good to make purchases at a store, online, or get money out of an ATM. Funding your card could be done by direct deposit or by reloading the card at one among 1000's of stores that provide the service. There isn't a need 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 no credit check and most individuals are approved on-line immediately. Because there isn't a credit check there is no inquiry recorded in your credit report.
While carrying a debit card is safer than carrying cash, there is a downside when it involves 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 is not reported for 60 days, then there is no such thing as a protection and your account could be wiped out. The big difference right here is in case you are disputing a fraudulent credit card charge, you are not out of money. In the event you report a fraudulent use of your debit card, the bank might take 10 days to research that means you are out that unauthorized use for over a week.
So how do these cards make cash for the issuers? If you are thinking about utilizing a debit card, make certain you careabsolutely read the terms and conditions and price schedule. There are lots of programs available on the internet they usually all have different price schedules and features. Look for a card that does not cost you to reload when you use direct deposit. Look for a card that can help you see your balance on-line or through telephone without a charge. If you shop careabsolutely, you will definitely save money compared to the check cashing shops.
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