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Prepaid credit cards in the United States are an excellent option to build your credit score and control your spending on a budget.
Prepaid credit cards in the United States are mainly characterized by the cash deposit associated with them: customers who have them must constantly recharge them in order to use them. Thanks to this peculiarity, they are considered the most recommended option for those people who are not in the best financial moment to maintain a credit card or who do not have a sufficient credit score to obtain them, allowing them -if they are well used- to maintain away from interest and other risks generated by the money borrowed by banks.
Another advantage of prepaid credit cards lies in the fact that they impose control over customer spending, unlike credit cards. With each deposit or reload, people set their own limit and avoid risking debt or overdraft fees, among other late payment fees.
In a nutshell, prepaid cards work like credit cards (in fact they are often associated with them), but they are actually almost like debit cards because the transactions are not covered by a bank. These cards are very similar to secured credit cards and, according to the Consumer Financial Protection Bureau (CFPB), differ from regular debit cards because they are not associated with a bank account. The funds come from the top-ups made by the customer in authorized establishments, thus setting a spending limit that, once reached, requires a new top-up for future transactions.
What are the best prepaid cards in the United States?
As with most banking products, when choosing between options, it is important to consider our own financial needs. In that sense, when it comes to prepaid cards, it is necessary to take into account the benefits they offer and if those benefits cover our needs. Beyond each particular case, however, there are options that experts consider to be some of the most convenient to apply for in the United States:
BlueBird from American Express – Best Prepaid Card for Cash Withdrawals
- Card born from the association between Walmart and American Express, which implies benefits in both sources.
- Allows you to load and spend money freely without spending extra fees.
- With this card, the customer can make free withdrawals at ATMs in its network, free cash recharge at Walmart or Money Center and free early direct deposit.
- Does not require a monthly fee.
- The most notable drawback is that this card tends to have limited commercial acceptance.
- Free ATM withdrawal is only possible on the MoneyPass network, therefore doing so at another type of ATM incurs a fee of $2.50 per transaction.
- They are added to the charges for using ATMs outside the network.
Wells Fargo EasyPay – Best Prepaid Card with Greatest Access Nationwide
- The biggest advantage of Wells Fargo EasyPay, compared to other options, is its broad national coverage, which allows free cash and check reloads through a network of more than 13,000 ATMs, with at least 5,500 branches in 36 state.
- There is no fee for using ATMs within the network.
- Requires a minimum deposit of $25.
- When customers use an out-of-network ATM, a $2.50 fee is required.
- Requires a monthly fee of $5.
Walmart MoneyCard – Best Prepaid Card for Walmart Purchases
- A 3% cash back on online purchases on the official Walmart website.
- 1% cash back at Walmart stores.
- 2% cash back on purchases at Murphy USA and Walmart fuel stations. – Issues rewards up to a cap of $75 in rewards per year.
- Requires charging at least $1,000 in a month to avoid the $5 monthly maintenance fee.
- Another feature against is that this card generates a fee of $1 for purchases in other stores outside its network.
H&R Block Emerald Prepaid Mastercard – Best card to reload with checks
- Receives deposits directly from checks
- Does not impose check cashing fees.
- Can be used anywhere MasterCard cards are accepted.
- Allows you to configure the payment of invoices.
- Customers who have this card can reload mainly at Walmart or Dollar General stores and can also deposit money at H&R Block branches and ATMs.
- Although it is also possible to recharge in other establishments outside the aforementioned network, the associated fees imply a charge of $4.95.
- Requires a $3 fee for cash withdrawals at ATMs other than from this financial institution.
As we have seen, although prepaid cards offer benefits to many people who cannot access credit cards, it is important to keep in mind that they also imply limitations. Some of them can only be used in certain places, resulting in fees for any other use that the client allocates. In a strict sense, when it comes to benefits, they seem to be halfway between credit cards or conventional debit cards, although they can be an excellent alternative if customers have another type of product, such as a checking account, since can be used for very specific purchases and expenses.